Action brought on 10 January 2014 – Electrabel and Dunamenti Erőmű v Commission

(Case T-40/14)

Language of the case: English

Parties

Applicants: Electrabel (Brussels, Belgium) and Dunamenti Erőmű Zrt. (Százhalombatta, Hungary) (represented by: J. Philippe, lawyer)

Defendant: European Commission

Form of order sought

The applicants claim that the Court should:

Declare the action admissible;

Find that the European Commission has incurred non-contractual liability for the unlawful adoption of decision 2009/609/EC of 4 June 2008 on State aid C 41/2005 (OJ 2009 L 225, p. 53) (the “PPA decision”);

Order the Commission to fully compensate jointly to the applicants the losses incurred by them that flow from the wrongful early termination of the power purchase agreement (“PPA”) dated 10 October 1995 between Magyar Villamos Művek (“MVM”), the state-owned electricity wholesaler, and Dunamenti, a power generator, in application of decision 2009/609/EC of 4 June 2008 on State aid C 41/2005, and which amount to a minimum of EUR 250 million, such amount to be updated and amended in view of future data to become available;

Order interest to be paid on the above compensation from the date of the judgment establishing the obligation to pay damages in this case at a rate of 8% per year, or at such a rate as the Court might fix in the exercise of its discretion; and

Order the defendant to pay the costs of the present proceedings.

Pleas in law and main arguments

In support of the action, the applicants rely on three pleas in law.

First plea in law, alleging that the PPA decision is manifestly unlawful. The applicants contend that the PPA decision (which is currently being appealed before the General Court - case T-179/09) is vitiated by a large number of grave errors that are incompatible with the normal conduct of an institution in charge of ensuring the application of competition rules and should thus give rise to liability on part of the EU, as:

the data included in the PPA decision clearly demonstrate that the PPA did not confer any economic advantage;

the PPA formed part of Dunamenti’s privatisation package and pre-dated it, and was thus valued in the price paid by Electrabel but the Commission refused to take it into account, thereby manifestly infringing EU law;

the recovery order of the PPA decision is so deeply vitiated that a calculation made by well-known economists found, as an outcome, a negative aid, which means no aid.

The applicants submit that such gross mistakes cannot be explained by the prima facie complexity of the case or by the objective constraints to which the Commission is subject when carrying out State aid control. Rather, these mistakes are to a large extent due to the Commission’s refusal to assess the PPA individually and constitute clear evidence of a serious failure to observe the limits imposed on the discretion of the Commission.

Second plea in law, alleging that actual damage has been suffered by the applicants as a result of the early termination of the PPA. Due to the unlawful conduct of the Commission, the PPA was terminated before the end of its contractual term. The applicants submit that, as a result of this early termination, they have incurred very significant losses and that such damage, which cannot be precisely quantified at this stage, exceeds €250 million.

Third plea in law, alleging that there is a direct causal link between the Commission’s unlawful conduct and the damage incurred by the applicants. The applicants contend that if the Commission’s conduct had been compliant with EU law, there would be no early termination of the PPA, thus the damage arising for the applicants from the wrongful PPA decision would have been avoided.