Judgment of the General Court (Sixth Chamber) of 22 September 2011 – Spain v Commission

(Case T-67/10)

EAGGF – Guidance Section – Reduction of financial assistance – Financial assistance awarded to an operational programme for the improvement of the processing and marketing of agricultural products – Effectiveness of checks – Proportionality

1.                     Economic and social cohesion – Structural assistance – Community financing – Obligation on Member States to establish management and control systems – Serious inadequacies capable of leading to systemic irregularities – Consequence – Suspension of intermediate payments (Council Regulation No 1260/1999, Arts 38(1) and 39(2)(c) and (3); Commission Regulation No 438/2001, Arts 3, 4 and 7) (see paras 23-25)

2.                     Economic and social cohesion – Structural assistance – Community financing – Decision to reduce financial aid by reason of irregularities – Financial consequences not ascertainable – Flat-rate correction – Breach of principle of proportionality – None (Council Regulation No 1260/1999, Art. 39(3)) (see paras 36-38)

Re:

APPLICATION for annulment of Commission Decision C(2009) 9827 of 10 December 2009 applying financial corrections to the EAGGF assistance, Guidance Section, awarded to the operational programme CCI 2000.ES.16.1.PO.007 (Spain, Castilla y León) in relation to the measure improving processing and marketing of agricultural products.

Operative part

The Court:

1. Dismisses the action;

2. Orders the Kingdom of Spain to pay the costs.