Judgment of the General Court (Third Chamber) of 14 December 2011 – Spain v Commission

(Case T-106/10)

EAGGF – Guidance Section – Reduction of financial aid – Community initiative programme Leader+ – Article 4 of Regulation (EC) No 438/2001 – Proportionality

1.                     Economic and social cohesion – Structural assistance – European Union funding – Obligation on Member States to establish monitoring and control systems – Duty to keep records of the checks made – Scope (Council Regulation No 1260/1999; Commission Regulation No 438/2001, Art. 4) (see paras 33, 36, 39-40)

2.                     Economic and social cohesion – Structural assistance – European Union funding – Decision to reduce financial aid by reason of irregularities – Financial consequences not quantifiable – Blanket correction – Breach of principle of proportionality – None (Council Regulation No 1260/1999, Art. 39(2)(c) and (3); Commission Regulation No 438/2001, Art. 4) (see paras 51-52, 61)

3.                     Economic and social cohesion – Structural assistance – European Union funding – Decision to reduce financial aid by reason of irregularities – Obligations of the Commission – Duty to act within a reasonable time – Criteria for assessment (Council Regulation No 1260/1999, Arts 38(1) and 39(2)) (see paras 65-67, 73-76)

Re:

APPLICATION for annulment of Commission Decision C(2009) 10136 final of 18 December 2009 final applying financial corrections to the support from the Guidance Section of the EAGGF allocated to the Community initiative CCI 2000.ES.06.0.PC.003 (Spain — Leader+ Aragon).

Operative part

The Court:

1. Dismisses the action;

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