Notice for the OJ
Action brought on 23 December 2002 by Kronoply GmbH & Co. KG and Kronotex GmbH & Co. KG against the Commission of the European Communities
(Case T-388/02)
(Language of the case: German)
An action against the Commission of the European Communities was brought before the Court of First Instance of the European Communities on 23 December 2002 by Kronoply GmbH & Co. KG and Kronotex GmbH & Co. KG, Heiligengrabe, Germany, represented by R. Nierer, Rechtsanwalt.
The applicants claim that the Court should:
--annul the Commission's decision of 19 June 2002 (State Aid No N 240/2002) not to raise any objection to the Federal Republic of Germany granting State aid to Zellstoff Stendal GmbH;
--order the Commission to pay the costs.
Pleas in law and main arguments
The applicants produce timber-based materials from freshly felled pine, including [...] oriented structural boards. Their action is brought against the Commission's decision to raise no objection to the granting of a non-repayable subsidy of EUR 109.161 million and an investment allowance of EUR 165.515 million to Zellstoff Stendal GmbH for the construction of a cellulose factory and the establishment of a wood procurement undertaking and a logistics undertaking in Arneburg bei Stendal in the Land Sachsen-Anhalt, Germany, and also against the provision of an 80% surety for a loan of EUR 464.550 million.
The applicants claim that the Commission did not fully adhere to the guidelines and general regulations. It failed to examine the sectoral effects of the plans on wood as a resource and adopted too wide a procurement radius. That wide procurement radius leads in their submission to higher costs and thus the unprofitability of the undertaking, whereas, if a smaller procurement radius were used, forest resources would not be sufficient to supply all wood-processing undertakings in the region.
The Commission failed to take account of the fact that the aid beneficiary's own share was less than the necessary 25%.
The Commission calculated the number of indirectly created jobs at too high a figure, so that, instead of the factor of 1.5, a factor of 1.25 should have been used. The maximum permissible intensity of aid was therefore only 26.25%.
In addition, the aid proportion of a State guarantee for a loan was calculated too low, so that, on a correct calculation, there was an aid intensity of 33.31%, which even exceeded the maximum aid intensity approved by the Commission of 31.5%.
Council Regulation (EC) No 659/99 of 22 March 1999 laying down detailed rules for the application of Article 88 EC
1 was infringed, since no formal investigation procedure was opened, although the Commission had cause for concern. The applicants were thereby hindered in the exercise of their procedural rights and limited in their right to a hearing.
Since the regional aid guidelines and the provisions of the multisectoral regional aid framework were not complied with, none of the exceptions in Article 87(3)(a) and (c) of the EC Treaty can apply.
The Commission further infringed Article 2, Article 3(1)(i), Article 6, and the third indent of Article 174(1) of the EC Treaty, as it failed to take account of the environmental impact when making its decisions. In the applicants' submission, the plans being supported would lead to overfelling in order to meet requirements.
____________1 - OJ 1999 L 83, p. 1