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Language of document : ECLI:EU:T:1997:135

JUDGMENT OF THE COURT OF FIRST INSTANCE (Fifth Chamber,Extended Composition)

25 September 1997 (1)

[234s(Action for annulment State aid ECSC Treaty Fifth Steel Aid Code Newplant Community guidelines on aid for environmental protection)[s

In Case T-150/95,

UK Steel Association, formerly British Iron and Steel Producers Association(BISPA), an association constituted under English law, whose head office is inLondon, represented by John Boyce and Philip Raven, Solicitors, with an addressfor service in Luxembourg at the Chambers of Wagener & Rukavina, 10aBoulevard de la Foire,

applicant,

Commission of the European Communities, represented by Nicholas Khan andPaul Nemitz, of its Legal Service, acting as Agents, with an address for service inLuxembourg at the office of Carlos Gómez de la Cruz, of its Legal Service, WagnerCentre, Kirchberg,

defendant,

supported by

Grand Duchy of Luxembourg,represented by Georges Schmit, Premier Conseillerdu Gouvernement in the Ministry of the Economy, acting as Agent, assisted byBernard van de Walle de Ghelcke and K. Platteau, of the Brussels Bar, 13A RueBréderode, Brussels, with an address for service at the Ministry of the Economy,19-21 Boulevard Royal,

and

Arbed SA,a company incorporated under Luxembourg law, established inLuxembourg, represented by Alexandre Vandencasteele, of the Brussels Bar, withan address for service at the office of Paul Ehmann, Legal Department, Arbed, 19Avenue de la Liberté,

interveners,

APPLICATION for annulment of the decision reproduced in Commission notice94/C 400/02 pursuant to Article 6(4) of Decision No 3855/91/ECSC to otherMember States and interested parties concerning aid which Luxembourg plans togrant to ProfilARBED SA (Arbed) (State Aid C 25/94 (ex N 11/94), OJ 1994C 400, p. 10), finding that the aid which the Grand Duchy of Luxembourg plannedto grant to ProfilARBED SA conformed to Article 3 of Decision No 3855/91 andwas thus compatible with the common market,

THE COURT OF FIRST INSTANCE

OF THE EUROPEAN COMMUNITIES (Fifth Chamber, ExtendedComposition),

composed of: R. García-Valdecasas, President, V. Tiili, J. Azizi, R.M. MouraRamos and M. Jaeger, Judges,

Registrar: A. Mair, Administrator,

having regard to the written procedure and further to the hearing on 11 March1997,

gives the following

Judgment

Legislative background

Article 4(c) of the ECSC Treaty provides:

'The following are recognized as incompatible with the common market for coaland steel and shall accordingly be abolished and prohibited within the Community,as provided in this Treaty:

...

(c) subsidies or aids granted by States, or special charges imposed by States, inany form whatsoever;

....
Under the first paragraph of Article 95 of the ECSC Treaty, the Commission, withthe unanimous assent of the Council and having consulted the ConsultativeCommittee, adopted Decision No 257/80/ECSC of 1 February 1980 establishingCommunity rules for specific aids to the steel industry (OJ 1980 L 29, p. 5),commonly referred to as 'the first steel aid code. According to the secondparagraph of Part I of the preamble to that decision, the prohibition in the ECSCTreaty on subsidies or aid granted by States applies only to measures constitutingpurely national steel policy instruments and not to aid aimed at setting up aCommunity steel policy, such as the restructuring of the steel industry, which wasthe aim of Decision No 257/80/ECSC.
The first steel aid code was subsequently replaced by successive codes, eachestablishing the rules applicable to State aid for the steel industry by laying downthe criteria under which aid could be found compatible. Those codes furtherspecified that aid to the steel industry financed by a Member State in any formwhatsoever may be deemed Community aid and therefore compatible with theorderly functioning of the common market only if it satisfies the provisions of thecode in question.
In 1991, Commission Decision No 3855/91/ECSC of 27 November 1991 establishingCommunity rules for aid to the steel industry (OJ 1991 L 362, p. 57, hereinafter'the Fifth Code) laid down the new relevant provisions concerning the grant ofState aid in this field. The Fifth Code was applicable when the contested decisionwas adopted and remained in force until 31 December 1996. Since 1 January 1997,it has been replaced by Commission Decision No 2496/96/ECSC of 18 December1996 establishing Community rules for State aid to the steel industry (OJ 1996L 338, p. 42), which forms the sixth steel aid code.
The following provisions of the Fifth Code are relevant to the present case:
- the fourth paragraph of Part I of the preamble, which states that the aimof the rules laid down by the code is
'firstly not to deprive the steel industry of aid for research and development or forbringing plants into line with new environmental standards;
- the second paragraph of Part II of the preamble, which states:
'In order to ensure that the steel industry and other industries have equal accessto aid for research and development, in so far as this is permitted by the Treaties,the compatibility of these aid schemes with the common market will be assessedin the light of the Community framework on State aid for research anddevelopment. As the provisions on aid for environmental protection are identicalto those contained in the framework on State aid in environmental matters, theyhave not been changed. If the rules laid down by these two general frameworkswere changed substantially during the term of validity of this Decision, a proposalfor an amendment would be presented; and
- Article 3, which provides:
'1. Aid granted to steel undertakings for bringing into line with new statutoryenvironmental standards plants which entered into service at least two yearsbefore the introduction of the standards may be deemed compatible withthe common market.

2. The total amount of aid granted for this purpose may not exceed 15% netgrant equivalent of the investment costs directly related to theenvironmental measures concerned. Where the investment is associatedwith an increase in the capacity of the plant, the eligible costs shall beproportionate to the initial capacity of the plant.
In the light of developments in the Council's approach to environmental policy, andin the absence of any Community rules laid down in that regard by the provisionsof the EEC Treaty concerning State aid, the Commission decided in 1974 to adopta communication concerning the Community framework on State aid inenvironmental matters. The aim of the communication was to inform the MemberStates of the general criteria which the Commission would use in applying Article92 et seq. of the EEC Treaty to existing or planned aid granted by the MemberStates on the basis of specifically environmental requirements (hereinafter 'the ECframework or 'the EC guidelines).
The EC framework on State aid in environmental matters applicable when theFifth Code was adopted had been defined in Commission communicationSG (80) D/8287 of 7 July 1980 ('the 1980 EC framework) and extended byCommission communication SG (87) D/3795 of 23 March 1987 ('the 1987 ECframework). The latter communication specified the criteria required in order foraid for environmental protection in the EC context to be found compatible with thecommon market. Those criteria, laid down in point 3 of the communication of 23March 1987, were as follows:

'3.2.1    Aid may be given at a rate not exceeding 15% of the value of theinvestment aided. The amount of aid will be calculated as a net after taxsubsidy in accordance with the methods of evaluation used by theCommission and described in its communication to the Member States onregional aid systems.

3.2.2    Only undertakings having installations in operation for at least two yearsbefore entry into force of the standards in question may qualify forassistance.

3.2.3    Investments made in order to comply with the standards may consist ineither installing additional equipment to reduce or eliminate pollution andnuisances or adapting production processes for the same purpose. In thelatter case any portion of investment leading to an increase in existingproduction capacity will not qualify for the proposed assistance.

3.2.4    The undertakings themselves must bear the entire cost of normalreplacement investment and operating expenses.
On 10 March 1994, new Community guidelines on State aid for environmentalprotection (94/C 72/03) were published in the Official Journal of the EuropeanCommunities (OJ 1994 C 72, p. 3, hereinafter 'the 1994 EC guidelines). Thosenew guidelines define the criteria applicable to aid in all the sectors governed bythe EC Treaty and point 2.2 sets out the approach followed by the Commission inthe assessment pursuant to Article 92 of the EC Treaty of State aid for certainpurposes in the environmental field. They amended the 1987 EC framework inexistence when the Fifth Code was adopted, stating inter alia that, in certaincircumstances, firms which decide to replace existing plant more than two years oldby new plant meeting new environmental standards may receive aid in respect ofthat part of the investment costs that does not exceed the cost of adapting the oldplant (see the third paragraph of point 3.2.3.A of the 1994 EC guidelines).
On 14 March 1995, the Commission presented a proposal to the Council amendingthe Fifth Code, in the form of a communication entitled 'Request for Councilassent and consultation of the ECSC Committee, pursuant to Article 95 of theECSC Treaty, concerning a draft Commission decision amending Article 3 of theSteel Aid Code (SEC (95) 315 final).
Paragraph 5 of that communication explains that the new 1994 EC guidelines,which replaced the former 1987 framework in force when the Fifth Code wasadopted and to which the Fifth Code referred, differ in at least five major respectsfrom the former guidelines and thus from the Fifth Code. Those five aspects arelisted in paragraph 5. Paragraph 5(b) points out, in connection with one of thoseaspects, that although, in keeping with the 'polluter pays principle, no aid shouldin general be given towards the cost of complying with mandatory standards in newplant, the new EC guidelines, in the penultimate paragraph of point 3.2.3.A,'specifically state that firms which, instead of simply adapting existing plant morethan two years old, opt to replace it by new plant meeting the new standards mayreceive aid in respect of that part of the investment costs that does not exceed thecost of adapting the old plant.
Paragraph 6 of that proposal concludes:

'Consequently, in order to comply more fully with the conditions laid down in thepreamble to the Steel Aid Code, and in particular with the principle that the steelindustry and other industries must have equal access to the aid in question, it isboth necessary and appropriate that the Commission should decide to amendArticle 3 of the Aid Code in the manner set out in the attached draft Decision.
Article 1 of the draft decision attached to the Commission's communication readsas follows:

'Article 1Article 3 of Decision 3855/91/ECSC is replaced by the following:

Aid for environmental protectionAid for environmental protection may be deemed compatible with the commonmarket if it is in compliance with the rules laid down in the Community guidelinesin force on State aid for environmental protection".
That Commission proposal did not receive the assent of the Council.

Facts
By letter of 29 December 1993, the Grand Duchy of Luxembourg informed theCommission, pursuant to Article 6(1) of the Fifth Code, of a plan to grant aid toProfilARBED SA in the context of the construction of a new steel plant at Esch-Schifflange, Luxembourg.
By letter of 5 April 1994, in response to a request from the Commission, the GrandDuchy of Luxembourg provided further information concerning the planned aid.
On 1 June 1994, pursuant to Article 6(4) of the Fifth Code, the Commissioninitiated a procedure against the planned aid (Commission Notice 94/C 212/07, OJ1994 C 212, p. 7). Following the opening of that procedure, it received a numberof comments, and those submitted by the applicant, then named the British Ironand Steel Producers Association (BISPA), by British Steel plc and by the UnitedKingdom of Great Britain and Northern Ireland were forwarded to theLuxembourg Government to allow it to reply.
By letter of 17 November 1994, the Grand Duchy of Luxembourg submitted to theCommission its views on the comments made by BISPA, British Steel plc and theUnited Kingdom.
By letter of 19 December 1994, the Grand Duchy of Luxembourg informed theCommission that it was prepared to set the aid ceiling at 15% of the eligibleinvestment, in accordance with the Community guidelines on aid for environmentalprotection.
On 31 December 1994, the Commission adopted the decision reproduced in itsnotice 94/C 400/02 pursuant to Article 6(4) of Decision No 3855/91/ECSC to otherMember States and interested parties concerning aid which Luxembourg plans togrant to ProfilARBED SA (Arbed) (State Aid C 25/94 (ex N 11/94), OJ 1994C 400, p. 10, 'the contested decision). In that decision, the Commissionterminated the procedure initiated on 1 June 1994 concerning that aid forenvironmental protection, without raising any objection. It found that the aidconformed to Article 3 of the Fifth Code and was thus compatible with thecommon market.
The contested decision authorizes payment of aid not exceeding LFR 91 950 000to the Luxembourg steel undertaking ProfilARBED SA (Arbed), a wholly-ownedsubsidiary of Arbed SA, a public limited company incorporated under Luxembourglaw. The aid in question represents 15% of the LFR 613 000 000 which Arbed hascommitted to spending on environmental protection in connection with theconstruction of a new electric steel plant in the Esch-Schifflange steel complex. The new steel plant will replace the existing LD-AC plants, which do not complywith the new Luxembourg environmental protection standards.
The applicant, named BISPA when it brought the action and now the UK SteelAssociation, is an association established in London representing United Kingdomundertakings which produce iron and steel products of the kind defined in AnnexI to the ECSC Treaty and supply those products within the Community.
Although the issue of the Official Journal in which the contested decision isreproduced bears the date 31 December 1994, it was not in fact available from theOffice for Official Publications of the European Communities until 27 May 1995.

Procedure and forms of order sought
The applicant brought the present action by application lodged at the Registry ofthe Court of First Instance on 19 July 1995.
By applications lodged on 21 December 1995, the Grand Duchy of Luxembourgand Arbed SA, the parent company of the recipient of the aid in issue, sought leaveto intervene in support of the defendant.
By orders of the President of the Fifth Chamber, Extended Composition, of 1March 1996, the Grand Duchy of Luxembourg and Arbed SA were granted leaveto intervene in support of the form of order sought by the defendant.
The interveners' statements in intervention and the observations of the main partieson those statements were lodged on 9 April and 3 June 1996 respectively.
Upon hearing the report of the Judge-Rapporteur, the Court (Fifth Chamber,Extended Composition) decided to take measures of organization of procedureunder Article 64 of the Rules of Procedure by requesting the Commission toanswer a written question, and to open the oral procedure.
In response to that request from the Court, the Commission indicated on 19September 1996 that the proposal to amend the Fifth Code had not yet receivedthe assent of the Council but that it had none the less submitted new draftCommunity rules for aid to the steel industry (sixth code) to replace the FifthCode, and appended a copy thereof to its response. It drew attention to the factthat Article 3 of the draft sixth code was substantially similar to Article 3 of theproposed amendment. Under the draft, the 1994 EC guidelines would beautomatically applicable to aid to the steel industry.
The abovementioned proposal did not receive the assent of the Council. Underthe final text of the sixth steel aid code, adopted by Commission Decision No2496/96/ECSC of 18 December 1996 (OJ 1996 L 338, p. 42), with the unanimousassent of the Council, the provision in the EC guidelines relating to aid for the steelindustry is not to be applied automatically in the ECSC sector but criteria are laiddown for the application of those guidelines in the ECSC sector.
The parties presented oral argument and replied to the questions put to themorally by the Court at the hearing on 11 March 1997.
The applicant claims that the Court should
- annul the contested decision; and
- order the defendant to pay the costs.
The Commission contends that the Court should
- dismiss the application; and
- order the applicant to pay the costs.
The Grand Duchy of Luxembourg claims that the Court should
- dismiss the application; and
- order the applicant to pay the costs, including those of the intervener.
Arbed claims that the Court should
- dismiss the application; and
- order the defendant (sic) to pay the costs of its intervention.
The oral procedure was closed by decision of the President of the Fifth Chamber,Extended Composition, on 25 March 1997.

The section of the contested decision entitled 'The Commission's assessment
In the first paragraph of the section of the contested decision entitled 'TheCommission's assessment, the Commission begins by recalling the terms of Article3(1) of the Fifth Code. It goes on, in the second paragraph, to note that the aidenvisaged is intended for the replacement of old plant by new facilities meeting thenew Luxembourg environmental protection standards. The contested decisionpoints out that the investment costs necessary to achieve such compliance wouldhave been considerably higher if the existing facilities had been retained.
In the third paragraph, on the basis that 'Part II of the preamble to the steel aidcode lays down the principle that the steel industry and other industries must haveequal access to aid for environmental protection, the Commission derives theprinciple that 'the same provisions of Community legislation regarding aid forenvironmental protection should be generally applicable to all firms, whether steelfirms or not and goes on to conclude at the end of the same paragraph that'unless otherwise provided for, the same principles of interpretation should beapplicable to all forms of aid for environmental protection.
Then, in the fourth paragraph of this part of the contested decision, theCommission points out that the Community guidelines on State aid forenvironmental protection make it possible to authorize aid to firms which, 'insteadof simply adapting existing plant more than two years old, opt to replace it by newplant meeting the new standards .... It notes, in the following paragraph, that 'itwould seem quite feasible to extend this general principle, as laid down in theaforementioned guidelines, to the steel aid code provided that it does not runcounter to the wording of Article 3 of [that code].
The Commission then examines, in the sixth paragraph, whether the aid envisagedmeets all the conditions set out in the Community guidelines, and concludes thatit does, including the ceiling of 15% gross of the investment (seventh paragraph).
The contested decision concludes, in the ninth and tenth paragraphs, as follows:'Accordingly, the Commission considers that it is possible, under Article 3(1) of theState aid code, to consider as compatible with the common market aid notexceeding 15% gross granted to firms which, instead of bringing into line with newenvironmental standards plants which entered into service at least two years beforethe introduction of the standards, decide to replace them by new facilities meetingthe new standards provided that the aid does not exceed that which would havebeen granted for adapting the old steelworks. Since the aid conforms to Article 3of [the Fifth Code], it may therefore be considered compatible with the commonmarket.

The Commission has therefore decided to terminate the procedure initiated inrespect of the aid granted to ProfilARBED for environmental protection.

Substance

The single plea in law alleging infringement of the ECSC Treaty or any rule of lawrelating to its application, in particular Article 3(1) of the Fifth Code
The applicant puts forward a single plea in law in support of its application,alleging infringement of the ECSC Treaty or any rule of law relating to itsapplication, in particular in that the contested decision contravenes Article 3(1) ofthe Fifth Code. It submits, essentially, that the aid authorized is intended for theconstruction of new plant complying with the new environmental protectionstandards rather than for the adaptation of existing plant to meet those standards.
In the light of the arguments put forward by the parties, the question whether theconstruction of a new electric arc furnace at Esch-Schifflange to replace the oldLD-AC furnace is to be regarded as an adaptation of old plant to meet the newstandards or the construction of new plant must be considered separately as apreliminary issue.

W hether the construction of a new electric arc furnace at Esch-Schifflange to replacethe old LD-AC furnace is to be regarded as an adaptation of old plant to meet thenew standards or the construction of new plant

Arguments of the parties
The interveners submit in their statements in intervention that the work in thepresent case does not involve constructing new plant meeting the newenvironmental protection standards but adapting existing old plant to meet thosestandards. The aid in issue therefore meets the criteria laid down by Article 3(1)of the Fifth Code and is thus compatible with the common market.
The Grand Duchy of Luxembourg explains that the plant in question comprises theliquid phase in the Esch-Schifflange steel production complex, the liquid phasebeing an integrated production tool composed of a ladle furnace, a steel furnaceand two continuous casting units, with the steel furnace and the continuous castingunits being unable to operate independently. The contested aid was intended forthe replacement of the steel furnace which was originally of the LD-AC oxygen-based design by an electric arc furnace. The Grand Duchy emphasizes that theonly part of the liquid phase to have been replaced is the steel furnace, a toolwhich cannot be viewed in isolation and which is only one of the sections in anintegrated production complex for the manufacture of semi-finished steel products. Thus, despite the replacement of the steel furnace, the plant itself has remained inplace and only been modernized.
Arbed too submits that the construction of a new electric arc furnace in the Esch-Schifflange complex does not amount to the construction of new plant but must beregarded as a modernization of that complex.
The applicant challenges that argument, stressing that it has been put forward bythe two interveners, but not raised by the Commission. The applicant submits, insubstance, that the Grand Duchy of Luxembourg had presented the same argumentto the Commission following notification of the proposal to grant aid but that theCommission had rejected it in the contested decision.
That argument, the applicant submits, questions the legality of the contesteddecision. It is, however, well established under Article 33 of the ECSC Treaty thatthe grounds on which a decision may be challenged are confined to thosesusceptible to judicial, not economic, review (Joined Cases 154/78, 205/78, 206/78226/78 to 228/78, 263/78, 264/78, 30/79, 31/79, 83/79 and 85/79 Ferriera Valsabbiaand Others v Commission [1980] ECR 907, paragraph 11) and that the Commissionhas a discretion in the assessment of the facts. The applicant considers that in theabsence of any allegation that the Commission misused its powers or made amanifest error, the Court's examination may not extend to the evaluation of thesituation resulting from economic facts or circumstances.
The applicant concludes that the interveners' argument is irrelevant to the presentproceedings and inadmissible.
It points out, furthermore, that, as is clear from the explanations appended to itsobservations on the statements in intervention, the aim of Arbed's plannedinvestment was to replace the present production process, based on the traditional'molten iron route in which basic oxygen, or LD-AC, converters are used, by anelectric arc process, which would enable Arbed to use scrap steel as its main rawmaterial and no longer be dependent on iron ore and coking coal, which weretraditionally mined in the vicinity of the Esch-Schifflange steel complex but suppliesof which will soon be exhausted. The applicant stresses that, without such areplacement, Luxembourg's geographical position would have entailed an increasein Arbed's production costs due to the incorporation of the transport costs for theraw materials. The replacement of the old LD-AC furnace by the new electric arcfurnace, which is the essential element of the new production process, cannot beregarded as an adaptation of an existing production process but must be regardedas the replacement of one process by another. Finally, the applicant points outthat the existing LD-AC plant will be definitively shut down by the end of 1997once the changeover between production processes has been completed, as statedby Arbed in its newsletters, appended by the applicant to its observations on thestatements in intervention.

Findings of the Court
In the light of the specific circumstances of the case and of the fact that thearguments put forward by the interveners as to whether or not the purpose of theaid in issue was to adapt existing plant are closely bound up with the applicant'ssingle plea in law alleging infringement of Article 3(1) of the Fifth Code, the Courtconsiders it appropriate to examine the interveners' arguments, without there beingany need to rule on their admissibility.
According to the contested decision (see paragraph 36 above), the aid in issue isintended for the replacement of old plant by new facilities meeting the newLuxembourg environmental protection standards.
In the penultimate paragraph of the section of the contested decision entitled 'Theaid in question, the Commission states: 'In view of the heavy investment neededto bring the existing LD-AC steel plants into line with the environmental protectionstandards and in order to avoid losing much of that investment when the existingsteel plants are replaced, Arbed decided to speed up the programme for replacingits steel mills by facilities meeting the environmental protection requirements. Thecost of Arbed's investment in environmental protection for the new steel planttotalled Lfrs 613 million.
At a further stage in its analysis, in the second paragraph of the section entitled'The Commission's assessment, it states: 'It transpires that, rather than adaptingits old plant to the new provisions, Arbed decided to speed up its programme ofreplacing old plant [by new] facilities meeting the new standards. The electric steelplant is the replacement, conforming to the new standards, for the old LD-AC steelplants, which were built in the 1960s and 1970s. Assuming the existing facilities areretained, the estimated total investment cost to Arbed would have been Lfrs 1.5billion, of which Lfrs 750 million for primary dust extraction (Lfrs 150 million fora converter upstream of the dry electrostatic filter and Lfrs 600 million for a newfurnace chimney-stack) and Lfrs 750 million for secondary dust extraction in thesteel plant. Consequently, the investment costs connected with environmentalprotection will not exceed the amounts that would have been involved in adaptingthe old plant.
It is also clear from the documents before the Court that the Grand Duchy ofLuxembourg notified the planned aid in the context of investment intended tospeed up the programme for replacing the existing steel plant facilities. TheLuxembourg Ministry of the Economy sent the Commission a memorandum dated29 December 1993, forwarded by letter from the office of the PermanentRepresentative of the Grand Duchy of Luxembourg of 30 December 1993 andheaded 'Memorandum concerning investments for environmental protection madeby ProfilARBED SA in the context of the installation of an electric arc furnace atEsch-Schifflange, the first paragraph of which refers to 'the construction of a newelectric arc furnace at Esch-Schifflange.
That representation is corroborated by a letter of 31 March 1994 from theLuxembourg Ministry of the Economy, forwarded to the Commission by letter fromthe office of the Permanent Representative of the Grand Duchy of Luxembourgof 5 April 1994, which specifies, in the last paragraph on page 2: 'In the light ofthe major investment costs entailed by bringing the existing LD-AC furnaces intoline with the environmental protection standards and in order to avoid losing alarge part of that investment when the existing furnaces are replaced over the nextfew years, ProfilARBED has decided to speed up the programme for replacing itssteel plant by facilities reflecting current technology as regards both steelproduction and environmental protection.
Arbed further stated at the hearing that the new electric arc furnace was the mostimportant, although not the only, element of the complex.
In reply to a question put by the Court at the hearing, the Grand Duchy ofLuxembourg also confirmed that, whilst the production process set up using theexisting basic oxygen or LD-AC plant can use up to 30% to 40% scrap as rawmaterial, the electric arc production process resulting from the investment for whichthe aid is intended makes it possible to use 100% scrap as raw material. It istherefore clear that both the production process and the composition of the rawmaterials have in fact changed as a result of the investment for which the aid wasintended.
It must further be noted that the applicant has asserted, without being contradictedby either the interveners or the Commission, that the existing LD-AC plant will bedefinitively shut down by the end of 1997. The replacement of existing plant to becovered by the investment for which the aid was intended will therefore have beencompleted by that date.
In the light of all the foregoing, the Court considers that the importance of thefacilities replaced, the scale of the changes to the production process and thesubstantial change in the composition of the raw material following completion ofthe investment for which the aid was intended amount to more than the adaptationof existing facilities. The Commission could thus rightly conclude, in the contesteddecision (see paragraphs 51 to 53 above), that the investment for which the aid wasintended consisted not in adapting old facilities to meet new requirements but inreplacing old plant by new facilities meeting the new environmental standards.
The interveners' argument on this point is therefore unfounded.

Infringement of Article 3(1) of the Fifth Code

Arguments of the parties
The applicant states that the interpretation set out in the contested decision thatArticle 3(1) of the Fifth Code (see paragraph 5 above) allows aid to qualify asenvironmental aid when it is to be used for the construction of new plant is contraryto the plain and unambiguous wording of that article, which refers only to aid forbringing into line with new statutory environmental standards plant which enteredinto service at least two years before the introduction of the standards.
In the applicant's submission, the Commission deduced from the second paragraphof Part II of the preamble to the Fifth Code (see paragraph 5 above) that the rulesin the EC guidelines relating to State aid could be applied automatically in theECSC sector. Such automatic application, it submits, constitutes an infringementof the Fifth Code, since it runs counter to Article 3 and to the very wording of thesecond paragraph of Part II of the preamble, which expressly requires a proposalfor an amendment to be presented in the event of a divergence between the ECguidelines and the Fifth Code, as has happened in the present case. It points outthat such a proposal was presented by the Commission after the adoption of thecontested decision and states that, in presenting that proposal, the Commission hasrecognized that its broad interpretation of Article 3(1) of the Fifth Code was legallyflawed.
The applicant further submits that the Commission's broad interpretation of Article3(1) of the Fifth Code is contrary to the provisions applicable to State aid in theambit of the ECSC and to the principles underlying them.
It points out that the provisions concerning State aid in the ECSC Treaty differfrom those in the EC Treaty. Whilst Article 4(c) of the ECSC Treaty provides thatall subsidies or aids granted by States in any form whatsoever are to be prohibited,Article 92 of the EC Treaty allows aid to be granted from public sources in thecircumstances therein defined.
Due to the severe problems faced by undertakings operating within the ECSC, theapplicant states, the Commission adopted, in accordance with the very rigorousprocedure laid down in Article 95 of the ECSC Treaty, a derogation from thegeneral principle that aid is prohibited in the ECSC field, in the form of the firststeel aid code, subsequently replaced by various successive versions.
The applicant concludes that the steel aid code must be interpreted narrowly andby reference only to its express wording, because it is an overriding principle of lawthat derogations from a Treaty principle should be interpreted strictly.
The Commission points out, first of all, that the applicant does not contest that theaid was in line with the 1994 EC guidelines. Nor, it stresses, does the applicantcontest that the costs for adapting the existing plant to the new environmentalstandards would have been significantly higher than the expenditure necessary forthe new plant to comply with those standards and that consequently the maximumaid that could have been approved on the basis of Article 3(1) of the Fifth Codewas significantly more than the aid approved in the contested decision.
As regards the applicant's claim that it followed an excessively broad interpretationof Article 3 of the Fifth Code, the Commission replies that this was not the casebut that, on the contrary, it interpreted it in line with the purpose of the Fifth Codeand its obligations under the ECSC Treaty.
The Commission submits that the contested decision is entirely consistent with thewording and purpose of Article 3(1) and of the Fifth Code in general, as it providesfor the most efficient solution to bring the recipient's production into line with thenew environmental standards. A proper understanding of the terms of Article 3(1)of the Fifth Code requires an examination of the wider background to the purposeof the code as well as a full appreciation of the growing importance ofenvironmental concerns in the application of Community policy. It maintains that,in taking the contested decision, it acted in line with Article 3(d) of the ECSCTreaty, which requires it to ensure, in the common interest, the maintenance ofconditions which will encourage undertakings to expand and improve theirproduction potential and to promote a policy of using natural resources rationally,avoiding their unconsidered exhaustion. The Commission concludes that the ECSCTreaty itself obliges it to take action to protect the environment in the commoninterest.
The Commission points out that the Single European Act strengthened theimportance of the Community powers in the environmental field. In particular, thelast line of the first subparagraph of Article 130r(2) of the EC Treaty provides:'Environmental protection requirements must be integrated into the definition andimplementation of other Community policies.
The Commission notes that the purpose of Article 3(1) of the Fifth Code coincideswith the corresponding provision in the 1994 EC guidelines. In its view, thereference in the preamble to the Fifth Code to the two general frameworks onState aid (the EC framework and the ECSC framework, the latter being establishedby the Fifth Code itself) confirms that the steel industry and other industries areto be given equal treatment with regard to aid for environmental protection.
The Commission explains that the principles underlying the rules in the Fifth Codeon State aid for environmental protection, which have not been changed, are evenbetter explained in Part II of the preamble to the fourth code, which states: 'Itwould be unjustified ... to deny the Community steel industry aid ... for bringingplants into line with new environmental standards. Aid for these purposes whichis in the public interest and satisfies the conditions laid down in this Decisionshould be available to the steel industry, just as similar aid is permitted to otherindustries under Article[s] 92 and 93 of the EEC Treaty.
The Commission submits that it is possible to grant aid to firms which, instead ofsimply adapting existing plant more than two years old, opt to replace it by newplant meeting the new standards, and states that such an interpretation isconfirmed by Article 3(2) of the Fifth Code. That provision sets a ceiling of 15%net grant equivalent of the investment costs directly related to the environmentalmeasures concerned and expressly states that where the investment is associatedwith an increase in the capacity of the plant, the eligible costs are to beproportionate to the initial capacity of the plant.
The Commission considers that the facts do not support the applicant's argumentthat the proposal presented to the Council confirms that the Commission'sinterpretation of Article 3(1) is flawed. It maintains that, whilst it set out in itsrequest for Council assent the differences in wording between the Fifth Code andthe EC guidelines, that is because it considers that the proposed amendment wouldbe of a confirmatory nature, increasing the transparency of the Fifth Code without,however, modifying its substance and meaning.
The Commission states that it also took into consideration the specificenvironmental benefits provided by the planned investment, having regard to thestringency of the Luxembourg standards, and the fact that the amount of aid wassmaller than it would have been had the facilities been adapted. It submits that itwould have been against the spirit of the Fifth Code to punish a Member Statewhich imposes higher environmental standards than other Member States.
The Commission also points out that, 'infringement of this Treaty being one ofthe grounds for annulment provided under Article 33 of the ECSC Treaty, thiscannot involve a review of the merits of the economic analysis on which thecontested decision is based, since the grounds on which a decision may bechallenged are expressly confined in Article 33 to those susceptible to judicial, noteconomic, review. It submits that, in the context of reviewing the legality ofdecisions based on Article 95 and the Fifth Code, such review must be confined toexamining whether it has committed a manifest error in its appreciation of thenecessity of the aid authorized for the furtherance of the aims of the Treaty.
The Grand Duchy of Luxembourg points out that Article 3 of the Fifth Code laysdown three conditions to be met before aid can be declared compatible with theorderly functioning of the common market: (i) the aid must be granted for bringingexisting plant into line with new environmental standards; (ii) the plant in questionmust have been in service for at least two years; and (iii) the aid must not exceed15% net of the amount of the investment. In the Grand Duchy's opinion, thosethree conditions are met in the present case.
The first condition that the aid must be granted for bringing existing plant intoline with new environmental standards is met in the present case, the GrandDuchy of Luxembourg notes, following the adoption of two ministerial decreeslaying down the operating conditions imposed on ProfilARBED SA, relating inparticular to dust and noise emissions.
The Grand Duchy also considers that the second condition that the plant inquestion must have been in service for at least two years is met. The plant inquestion here is that of the liquid phase of the Esch-Schifflange production complexcomprising, in addition to the liquid phase, a walking beam furnace and two rollingmills, and it is not in dispute that the production complex was in existence over twoyears before the new environmental standards entered into force.
As regards the third condition the ceiling of 15% net of the investment theLuxembourg Government submits that the aid as approved by the Commission fallsfar below the upper limit set in Article 3(2) of the Fifth Code, since it amounts to15% gross of ProfilARBED SA's investment, whereas Article 3 imposes a ceilingof 15% net, which is equivalent to some 25 to 30% gross.
The Grand Duchy of Luxembourg further points out that the wording of Article 3of the Fifth Code is identical to that of the 1987 EC framework, which wasapplicable when the Fifth Code was adopted. It adds that, unlike the Fifth Code,that framework does not refer exclusively to plant but also refers to the installationof additional equipment and the conversion of production processes. Theprovisions of the Fifth Code, it submits, being based on the concept of equal accessto aid for environmental protection irrespective of the sectors in which theundertakings concerned operate, must be interpreted in the light of the ECframework. Aid may be granted, therefore, for adapting a production process. Inthe present case, the investments made by ProfilARBED SA led specifically to amodification of the production process.
Arbed submits that the only question open to interpretation as regards Article 3(1)of the Fifth Code is whether there is any limitation on the extent of themodernization necessary for the plant to meet the new environmental protectionstandards. As long as the aid authorized contributes to the achievement of theobjective pursued by Article 3 of the Fifth Code, it considers, there is nothing inthat article to require the Commission to take into account the nature and extentof the modernization.
Arbed therefore submits that, even if the replacement of the LD-AC steelconverters by electric arc furnaces is regarded as the replacement rather than theadaptation of existing plant, the Commission correctly applied the Fifth Code whenit considered that such replacement was covered by Article 3(1).
Arbed also challenges the alleged need for a formal amendment of the Fifth Codeto bring it into line with the evolution of the regime for environmental aid underthe EC Treaty since, when the Fifth Code was adopted, the Community (EC) ruleson environmental protection already made it possible to authorize State aid grantedto undertakings for adapting their existing activities to new environmentalstandards, the only condition required being the existence of a polluting activity forat least two years before the entry into force of those standards, as was made clearin the 1974 EC framework and confirmed in the 1987 EC framework.
Arbed also submits that the applicant's reasoning concerning the alleged need fora narrow interpretation of Article 3(1) of the Fifth Code fails to take account ofthe specific nature of the ECSC Treaty and its limited scope. In its view, whenArticle 4(c) of the ECSC Treaty prohibits subsidies or aids granted by States orspecial charges imposed by States in any form whatsoever, this must be understood,in view of the limited scope of the Treaty, as referring to aid to production and/ordistribution and cannot concern aid for environmental protection, sinceenvironmental policy is not covered by the ECSC Treaty. Arbed points out thatit is precisely because environmental policy is not covered by the ECSC Treaty thatthe Commission was entitled to rely on the first paragraph of Article 95 of theECSC Treaty to adopt Article 3 of the Fifth Code, since that paragraph appliesonly to 'cases not provided for in this Treaty. If the rules laid down by the steelaid codes had constituted a derogation from Article 4 of the ECSC Treaty, as theapplicant maintains, the Commission would have had to rely on the third paragraphof Article 95.
The applicant rejects Arbed's argument: the reason the Commission was entitledto rely on the first paragraph of Article 95 of the ECSC Treaty to propose adecision authorizing the payment of aid for environmental purposes to steelundertakings was that the granting of State aid to steel producing undertakings isnot provided for in the ECSC Treaty. The applicant concludes that Article 3(1) ofthe Fifth Code is a derogation from Article 4 of the ECSC Treaty and is thussubject to a regime requiring a narrow interpretation.

Findings of the Court
It is necessary to examine whether the assumption underlying the contesteddecision, that Article 3(1) of the Fifth Code allowed aid to be granted for replacingexisting plant by new facilities meeting environmental protection standards, iscorrect in the light of the wording, context and purpose of that article.
As regards wording, Article 3(1) refers only to 'bringing into line with new ...standards plants which entered into service at least two years before theintroduction of the standards. A purely literal interpretation of Article 3(1)therefore excludes any investment not intended to bring facilities already in serviceinto line with new standards by, for example, replacing them by new facilities, evenif they meet the environmental protection standards.
The Commission expressly found in the contested decision that in this case existingplant was not being adapted but was being replaced by new facilities. It hassubmitted, however, that an interpretation of Article 3(1) in the light of its contextand purpose leads to the conclusion that such a possibility is consistent with Article3(1).
That reasoning must therefore be examined to determine whether it is wellfounded.
On the basis of the principle set out in Part II of the preamble to the Fifth Code,that the steel industry and other industries must have equal access to aid forenvironmental protection, the contested decision states, in the third paragraph ofthe section entitled 'The Commission's assessment, that the same provisions ofCommunity legislation regarding aid for environmental protection should begenerally applicable to all firms, whether steel firms or not.
It goes on to note, in the fourth paragraph of that section, that the Communityguidelines on State aid for environmental protection, published in the OfficialJournal C 72 of 10 March 1994, expressly stipulate that firms which, instead ofsimply adapting existing plant more than two years old, opt to replace it by newplant meeting the new standards may receive aid in respect of that part of theinvestment costs that does not exceed the cost of adapting the old plant.
Finally, in the fifth paragraph of the same section, the contested decision notes thatit would seem quite feasible to extend this general principle, as laid down in the ECguidelines, to the steel aid code provided that it does not run counter to thewording of Article 3 of the Fifth Code, and concludes in the ninth paragraph thatthe aid in question is compatible with the common market.
That reasoning cannot be upheld.
Firstly, the Fifth Code introduced rules which allow aid to be granted to the steelindustry in a limited number of specified cases, and Article 1(1) thereof posits theprinciple that such aid may be deemed Community aid and therefore compatiblewith the orderly functioning of the common market only if it satisfies the provisionsof Articles 2 to 5. The compatibility of aid must therefore be assessed in the lightof those provisions.
Secondly, the automatic application of the EC guidelines to the steel sector is notprovided for in the Fifth Code. Such automatic application cannot be inferredfrom the principle stated in the preamble to the Fifth Code, that the steel industryand other industries must have equal access to aid for environmental protection. That preamble merely notes that the rules governing aid for environmentalprotection laid down by the two frameworks were identical at the time when theFifth Code was adopted. However, the second paragraph of Part II of thepreamble (see paragraph 5 above) states that it would be necessary to present aproposal for an amendment to the Fifth Code if the rules laid down by the twogeneral frameworks were changed substantially during the term of validity of theFifth Code. The application of the EC guidelines to the steel sector is thereforenot automatic.
Thirdly, the EC framework in force when the Fifth Code was adopted the ECframework adopted in 1980 and extended in 1987 was in fact amended in
The penultimate paragraph of point 3.2.3.A of the new guidelines provides for thepossibility of granting aid for investment intended to replace existing plant by newplant. That possibility was not expressly provided for in the 1987 EC framework,which was in force when the Fifth Code was approved.
The eventuality envisaged in the second paragraph of Part II of the preamble tothe Fifth Code has therefore occurred, since the rules laid down by the 1987 ECframework were changed substantially by the 1994 EC guidelines during the termof validity of the Fifth Code. Consequently, application to the ECSC sector of theprinciple established by the new 1994 EC guidelines was conditional on thepresentation of a proposal for the amendment of the Fifth Code to bring it intoline with the new guidelines.
A proposal for such an amendment was in fact presented by the Commission on14 March 1995 (see paragraphs 9 and 10 above), after the adoption of thecontested decision. That proposal was specifically intended to amend Article 3 ofthe Fifth Code. At point 5 of the proposal, the Commission noted that the new1994 EC guidelines on State aid for environmental protection differed in at leastfive major aspects from the former guidelines and thus from the Fifth Code. Among those five aspects, it specifically mentioned the possibility provided for inthe penultimate paragraph of point 3.2.3.A of the new EC guidelines of grantingaid in certain circumstances to firms which, instead of simply adapting existing plantmore than two years old, opt to replace it by new plant meeting the new standards. The presentation of that proposal confirms, as the applicant rightly submits, thatthe Commission considered it necessary to amend Article 3 of the Fifth Code inorder to be able to apply the principle contained in the EC guidelines to the ECSCsector, and therefore contradicts the Commission's interpretation of Article 3(1) ofthe Fifth Code in the contested decision. The Commission cannot, therefore, claimthat the proposal for an amendment was intended solely to increase thetransparency of the Fifth Code, without, however, modifying its substance andmeaning.
Nor does the sixth steel aid code, approved by Commission Decision No2496/96/ECSC of 18 December 1996, provide for the automatic application to theECSC sector of the provision in the 1994 EC guidelines relating to aid forenvironmental protection; instead it defines the criteria for the application of thoseguidelines in the ECSC sector.
In the light of all the foregoing, it is clear that Article 3 of the Fifth Code does notprovide for the possibility of granting aid to firms which, instead of simply adaptingexisting plant, opt to replace it by new plant meeting the new environmentalstandards. Consequently, the assumption in the contested decision, that it ispossible to extend that provision of the EC guidelines to the steel aid code becauseit does not contradict the wording of Article 3 of the Fifth Code, must be rejected,since it does run counter to the clear wording of that article.
That conclusion cannot be altered by the fact that the national environmentalstandards in question are more stringent than in other Member States, by the factthat the amount of aid authorized is at least one-third lower than the amount whichit might have been possible to authorize, or by the fact that the aid does not exceedthe limit of 15% of the investment costs directly related to the environmentalmeasure concerned, since those considerations cannot justify granting aid to thesteel industry which does not meet the conditions laid down in Article 3(1) of theFifth Code.
Consequently, the argument put forward by the Grand Duchy of Luxembourg, thatthe contested aid meets the three conditions laid down by Article 3 of the FifthCode, cannot be accepted, since the first condition that the aid must be intendedto bring existing plant into line with new environmental protection standards isnot met in this case. That being so, no purpose can be served by analysing theGrand Duchy of Luxembourg's arguments concerning the other two conditions.
With regard to the interveners' argument that a formal amendment of the FifthCode was unnecessary since the 1987 EC framework, and even the earlier 1974framework, allowed aid to be authorized for the replacement of old plant by newplant meeting new environmental protection standards, it must be made clear atthe outset that reference to the 1974 EC framework is irrelevant in the presentcase, since the framework which was in force when the Fifth Code was adopted,and to which the Fifth Code refers, was the 1980 EC framework, extended in
It is thus in the light of the Fifth Code and the 1987 EC framework that it must bedetermined whether aid for the replacement of old plant by new plant meeting newenvironmental protection standards may be found compatible with the commonmarket.
The EC framework adopted in 1980 and extended in 1987 provided: 'Investmentsmade in order to comply with the standards may consist in either installingadditional equipment to reduce or eliminate pollution and nuisances or adaptingproduction processes for the same purpose. In the latter case any portion ofinvestment leading to an increase in existing production capacity will not qualify forthe proposed assistance. ... The undertakings themselves must bear the entire costof normal replacement investment and operating expenses (points 3.2.3 and 3.2.4).
As is clear both from the contested decision and from the letters sent to theCommission by the Luxembourg Government (see paragraphs 54 and 55 above),the investment for which the aid was intended forms part of a programme forreplacing existing plant, of which the electric arc furnace forms the essentialelement. It is therefore clear that the investment for which the aid was intendedcannot be regarded as additional equipment to reduce or eliminate pollution andnuisances.
As regards the adaptation of the production process for the same purpose, it mustbe borne in mind that, as held in paragraph 59 above, the investment for which theaid was intended concerns the replacement of the existing LD-AC plant by a newelectric arc furnace and, whilst the production process developed using the oldplant could use up to 30% to 40% scrap as raw material, the electric arcproduction process resulting from the investment for which the aid was intendedmakes it possible to use 100% scrap as raw material. The LD-AC plant will,moreover, be definitively shut down at the end of 1997. The basic oxygen or LD-AC process has in fact been replaced by an electric arc production process. Consequently, the investment made by Arbed clearly does not constitute theadaptation of a production process but the replacement of one such process byanother.
In any event, moreover, it must be noted that, under point 3.2.4 of the 1987 ECframework, in force when the Fifth Code was adopted, the entire cost ofreplacement investment should be borne by the undertakings.
The interveners' argument is therefore unfounded.
As regards the question whether Article 3(1) of the Fifth Code must be interpretedstrictly, it has been held (see paragraph 101 above) that the clear wording ofArticle 3 does not provide for the possibility of granting aid to firms which, insteadof simply adapting existing plant, opt to replace it by new plant meeting the newenvironmental standards. In the light of that finding, the arguments of thedefendant and of the interveners cannot lead to a different interpretation.
With regard to Arbed's argument relating to the legal basis for the Fifth Code, itmust be pointed out that the first paragraph of Article 95 of the ECSC Treaty,whilst it refers to 'cases not provided for in this Treaty, still clearly provides thatthe measures to be adopted in such cases must be in accordance with Article 5thereof and must be necessary to attain one of the objectives of the Community setout in Articles 2, 3 and 4 of the Treaty. The first paragraph of Article 95 thus doesnot authorize the adoption of measures which are inconsistent with the objectivesset out in those articles. Similarly, Part I of the preamble to the Fifth Codespecifies that recourse is to be had to the first paragraph of Article 95 of theTreaty, so as to enable the Community to pursue the objectives set out in Articles2 to 4 thereof. Consequently, the Fifth Code and the environmental concerns towhich it responds, inter alia, must be interpreted in the light of the objectives andprinciples set out in those articles.
Even if, as Arbed submits, the Commission was entitled to take the first paragraphof Article 95 of the ECSC Treaty as its basis on the ground that environmentalpolicy is not dealt with in that Treaty, it would still not be permissible to concludethat the Fifth Code does not constitute a derogation from Article 4 of the Treatyand that it must not be interpreted strictly.
Arbed's argument is, moreover, contradicted by the Commission itself, which notesthat it is obliged by the ECSC Treaty itself and in particular by Article 3(d) to takemeasures to protect the environment in the common interest.
In the light of the foregoing considerations, it is clear that the rules to be appliedin the ECSC sector in order to ensure that such concerns are addressed are thoselaid down in the Fifth Code, account being taken of the objectives set out in theTreaty and in particular the prohibition in Article 4(c) of any State aid in any formwhatsoever. Since the Fifth Code constitutes a derogation from Article 4 of theECSC Treaty, it must be interpreted strictly.
The need for a strict interpretation is confirmed by the very wording of thepreambles to the fourth and fifth codes, in which the Council and the Commissionclearly stated their intention that the steel aid codes should be interpreted strictlyand solely by reference to their express terms. The fifth paragraph of Part I of thepreamble to the fourth code stated:

'It is emphasized that any subsidies in any form whatsoever and whether specificor non-specific, which Member States might grant to their steel industries, otherthan aid expressly provided for and duly authorized under this Decision, [are]prohibited under Article 4(c) of the Treaty.
Consequently, the argument which the Commission derives from Part II of thepreamble to the fourth code, that the steel industry must be treated in the sameway as other sectors as regards aid for environmental protection, must be rejected,since it is clear from that part of the preamble that, in the context of the fourthcode, the principle of equal treatment for the steel industry and other sectors asregards aid requires, in any event, that the aid be 'in the public interest andsatisf[y] the conditions laid down in the code in question.
The wording of the second paragraph of Part I of the preamble to the Fifth Codeis equally clear and confirms the need for strict interpretation: 'As from 1 January1986, Commission Decision No 3484/85/ECSC ... established rules authorizing thegrant of aid to the steel industry in certain cases expressly provided for.
That interpretation is further corroborated by the fifth paragraph of the same partof that preamble, which states: 'The strict regime thus established ... has ensuredfair competition in this industry in recent years.
The Court therefore considers that Article 3(1), having regard to the context of theFifth Code in which it occurs and the objective which it pursues (see Case C-99/94Birkenbeul v Hauptzollamt Koblenz [1996] ECR I-1791, paragraph 12), must beinterpreted with the greatest possible regard to its wording.
The arguments of the Commission and the interveners are therefore not such asto invalidate the Court's conclusion that Article 3 of the Fifth Code does notprovide for the possibility of granting aid to firms which, instead of simply adaptingexisting plant, opt to replace it by new plant meeting new environmental standards.
In the light of all the foregoing, the contested decision must be held to infringeArticle 3(1) of the Fifth Code and must therefore be annulled.

Costs
Under Article 87(2) of the Rules of Procedure, the unsuccessful party is to beordered to pay the costs if they have been applied for in the successful party'spleadings. Since the Commission has been unsuccessful and the applicant hasapplied for costs, the Commission must be ordered to pay the costs.
Under the first subparagraph of Article 87(4), Member States which haveintervened in the proceedings are to bear their own costs. Under the thirdsubparagraph of that provision, the Court may order an intervener other than aState which is a party to the EEA Agreement, a Member State, an institution orthe EFTA Surveillance Authority to bear its own costs. In the circumstances of thiscase, the intervener Arbed must bear its own costs.

On those grounds,
THE COURT OF FIRST INSTANCE (Fifth Chamber, Extended Composition)
hereby:
1. Annuls the decision reproduced in Commission notice 94/C 400/02 pursuantto Article 6(4) of Decision No 3855/91/ECSC to other Member States andinterested parties concerning aid which Luxembourg plans to grant toProfilARBED SA (Arbed) (State Aid C 25/94 (ex N 11/94));
2. Orders the Commission to pay the costs;
3. Orders the Grand Duchy of Luxembourg and Arbed SA to bear their owncosts.

García-ValdecasasTiili

Azizi

Moura Ramos Jaeger

Delivered in open court in Luxembourg on 25 September 1997.

H. Jung

R. García-Valdecasas

Registrar

President

1: Language of the case: English.