Provisional text
JUDGMENT OF THE GENERAL COURT (First Chamber)
19 October 2022 (*)
(State aid – Activities linked to the production, processing and marketing of agricultural products – State aid schemes established by Greece in the form of interest subsidies and State guarantees on existing loans and new loans in order to make good the damage caused by natural disasters or exceptional occurrences – Decision declaring the aid schemes incompatible with the internal market and unlawful and ordering recovery of the aid paid – Aid limited to affected geographical areas – Advantage – Selective nature – Principle of sound administration – Duration of the procedure – Legitimate expectation – Limitation period – Article 17 of Regulation (EU) 2015/1589)
In Case T‑850/19,
Hellenic Republic, represented by E. Tsaousi, E. Leftheriotou and A.‑V. Vasilopoulou, acting as Agents,
applicant,
v
European Commission, represented by A. Bouchagiar and T. Ramopoulos, acting as Agents,
defendant,
THE GENERAL COURT (First Chamber),
composed of H. Kanninen, President, N. Półtorak and O. Porchia (Rapporteur), Judges,
Registrar: I. Pollalis, Administrator,
having regard to the written part of the procedure,
further to the hearing on 8 February 2022,
gives the following
Judgment
1 By its action based on Article 263 TFEU, the Hellenic Republic seeks the annulment of Commission Decision (EU) 2020/394 of 7 October 2019 concerning the measures SA.39119 (2016/C) (ex 2015/NN) (ex 2014/CP) implemented by the Hellenic Republic in the form of interest subsidies and guarantees linked to the fires of 2007 (the present decision covers only the agricultural sector) (OJ 2020 L 76, p. 4; ‘the contested decision’).
Background to the dispute
2 In July 2007, in Greece, a number of fires affected the prefecture of Magnesia, more specifically Pelion, as well as the island of Skiathos, the island of Kefalonia, the prefecture of Achaea and the Peloponnese. In August 2007, further fires broke out in the prefectures of Messenia, Elis, Arcadia, Laconia and Evia and in the municipality of Aigialeia in the prefecture of Achaea. On account of the situation caused by those fires, on 25 August 2007, the Prime Minister of the Hellenic Republic declared a state of emergency.
3 The Hellenic Republic subsequently adopted measures to support active operators established in the areas affected by the 2007 fires (‘the affected areas’), expressly referred to in those measures.
4 On 22 July 2014, the European Commission received a complaint concerning aid granted by the Hellenic Republic to Sogia Ellas AE and its subsidiaries (together, ‘Sogia Ellas’), companies operating in the agricultural products processing sector, consisting of interest subsidies and State guarantees on existing loans which were to be renegotiated with a grace period and on new loans.
5 By letter of 25 July 2014, the Commission requested information from the Greek authorities regarding the alleged aid, to which the Greek authorities replied by providing detailed information on the legal bases of that aid.
6 On 11 December 2015, the Commission sent a second letter to the Greek authorities, putting additional questions to them and informing them that the investigation into those measures would not be limited to Sogia Ellas, since the measures at issue could have been granted to other beneficiaries.
7 Therefore, the Commission decided to open a non-notified State aid case (Case SA.39119 (2015/NN)) and to extend the scope of its investigation to include the entire Greek agricultural sector.
8 On 11 February 2016, the Hellenic Republic provided further information on the legal bases of the aid in question, the conditions for granting it and the beneficiaries.
9 By letter of 17 May 2016, the Commission notified the Hellenic Republic of its decision to initiate the formal investigation procedure laid down in Article 108(2) TFEU concerning State aid SA.39119 (2016/C) (ex 2015/NN) (ex 2014/CP) – Aid to Sogia Ellas AE et al. (‘the decision to initiate the formal investigation procedure’).
10 By the publication of the decision to initiate the formal investigation procedure in the Official Journal of the European Union on 16 September 2016 (OJ 2016 C 341, p 23), the Commission invited interested parties to submit their comments, pursuant to Article 108(2) TFEU.
11 In the decision to initiate the formal investigation procedure, the Commission requested the Greek authorities to provide it with the estimated number of beneficiaries of each scheme identified in that decision and the aid amounts involved.
12 No interested parties submitted comments. The Greek authorities submitted their observations on the decision to initiate the formal investigation procedure on 23 September 2016. In their replies, they informed the Commission that they were unable to provide all the information requested, but finally did so by letters of 9 March 2017 and 21 February 2018.
13 On 7 October 2019, the Commission adopted the contested decision.
14 In the contested decision, which is intended to apply only to activities related to the production, processing and marketing of agricultural products, namely the products listed in Annex I to the TFEU, with the exception of fisheries and aquaculture products, the Commission decided, inter alia, that the aid schemes established under Ministerial Decision No 36579/B.1666/27.8.2007 (with subsequent amendments), in the form of interest subsidies and guarantees granted by the Hellenic Republic (‘the measures at issue’), constituted State aid for the purposes of Article 107(1) TFEU which was unlawful and incompatible with the internal market, with the result that the Hellenic Republic was required to recover the aid referred to in Article 1 of the contested decision from the beneficiaries, except in the cases expressly provided for in Articles 3 and 4 of that decision.
Forms of order sought by the parties
15 The Hellenic Republic claims that the Court should:
– annul the contested decision;
– order the Commission to pay the costs.
16 The Commission contends that the Court should:
– dismiss the action;
– order the Hellenic Republic to pay the costs.
Law
17 In support of its action, the Hellenic Republic raises three pleas in law, alleging, first, that there is no aid within the meaning of Article 107(1) TFEU, second, that the aid is compatible under Article 107(2)(b) TFEU and, third, breach of the duty to act within a reasonable time and the principle of sound administration, lack of competence ratione temporis on the part of the Commission, and breach of the principle of legal certainty, the principle of proportionality and the rights of the defence.
First plea: no aid within the meaning of Article 107(1) TFEU
18 The first plea consists of three parts. By the first part, the Hellenic Republic complains that the Commission misinterpreted and misapplied the conditions laid down in Article 107(1) TFEU. By the second part, the Hellenic Republic alleges errors of fact and failure to state reasons. By the third and last part, the Hellenic Republic claims breach of the principle of protection of legitimate expectations. Since the third part of the first plea and the first part of the third plea overlap in part, they should be examined under the third plea.
First part of the first plea in law, relating to the interpretation and application of the conditions laid down in Article 107(1) TFEU
19 In the first place, the Hellenic Republic claims that the measures at issue do not have an adverse impact on the State budget and do not entail any risk to its financial resources. Requiring a fee for the grant of the guarantees would have undermined the effectiveness of the measures. Furthermore, the lack of a fee is counterbalanced by a number of factors. Therefore, the criterion that aid must be financed by State resources is not satisfied.
20 In the second place, the Hellenic Republic submits that the measures at issue do not confer any ‘advantage’ on the persons to whom they are addressed, so that that criterion is also not satisfied, even though it ought to be if a finding of State aid is to be made.
21 While stating that it did not act in the present case as a private operator, the Hellenic Republic maintains that a long-term economic rationale underlies the measures at issue and that it is entitled to pursue a long-term policy, in accordance with its ‘social responsibility’, just like private operators. It claims that it cannot be held, in the present case, to have departed from the rules of the market, since it is conceivable that a private operator would have acted in the same way in pursuing a long-term benefit.
22 As regards the State guarantees in particular, the Hellenic Republic submits that the lack of a fee does not imply the existence of an advantage. A fee would have undermined the effectiveness of the measures. Furthermore, the lack of a fee is offset by several factors, including the fact that the viability of the undertakings was checked and distressed undertakings were excluded, that the guarantee granted covered a maximum of 80% of each loan, that the term of the loans was limited in time, and that the Hellenic Republic is entitled to recover the amount paid under the guarantee from the principal debtor.
23 The Hellenic Republic also maintains that the measures at issue did not mitigate the burdens which are ‘normally’ borne by undertakings. By means of its measures, it sought to address the exceptional situation faced by the beneficiaries of the measures at issue.
24 Lastly, the Hellenic Republic claims that the measures at issue are not selective. The beneficiaries of those measures were not in a comparable situation to that of other market participants. Their situation was an exceptional one, as the 2007 fires were not part of ‘the economic risk any undertaking may face’, as the Commission found in recital 118 of the contested decision. Thus, the aim of the measures at issue was not to distort competition but to restore conditions of competition.
25 In the third place, the Hellenic Republic argues that the measures at issue do not affect trade between Member States and do not distort competition. In that regard, it refers to statistical data showing that, during the period from 2008 to 2010, gross domestic product and gross added value decreased significantly in the affected areas. Furthermore, the Hellenic Republic submits that, in its assessment, the Commission wrongly assumed that distressed undertakings were eligible for the measures at issue.
26 The Commission challenges the arguments raised by the Hellenic Republic in support of the first part of the first plea.
27 As a preliminary point, it must be recalled that, according to settled case-law, classification of a national measure as ‘State aid’ for the purposes of Article 107(1) TFEU requires all the following conditions to be fulfilled. First, there must be an intervention by the State or through State resources. Second, the intervention must be liable to affect trade between Member States. Third, it must confer a selective advantage on the recipient. Fourth, it must distort or threaten to distort competition (see judgment of 21 December 2016, Commission v World Duty Free Group and Others, C‑20/15 P and C‑21/15 P, EU:C:2016:981, paragraph 53 and the case-law cited).
28 It should also be borne in mind that Article 107(1) TFEU does not distinguish between measures of State intervention by reference to their causes or aims but defines them in relation to their effects (judgments of 2 July 1974, Italy v Commission, 173/73, EU:C:1974:71, paragraph 27, and of 29 March 2012, 3M Italia, C‑417/10, EU:C:2012:184, paragraph 36).
29 As regards, first, the first condition for classifying a national measure as ‘State aid’ for the purposes of Article 107(1) TFEU, an analysis of Decision No 36579/B.1666/27/8.2007, contained in Annex A 12 to the application, and the Hellenic Republic’s responses to the Commission, contained in Annex A 21 to the application, show that undertakings established in the affected areas qualified for debt restructuring and the grant of loans for working capital, which were subject to full or partial interest subsidies financed by the Greek authorities and were also guaranteed by the Hellenic Republic without the recipients of those loans having to pay any fee in that regard.
30 Concerning the interest subsidies, since the interest payable was ‘subsidised’ in whole or in part by the account set up pursuant to nómos 128/1975, perí tropopoiíseos kai sympliróseos diatáxeón tinon anaferoménon eis tin leitourgían tou chrimatodotikoú systímatos (Law 128/1975 amending and supplementing the provisions on the functioning of the financial system) of 28 August 1975 (FEK A 178/28.8.1975), that subsidy necessarily put a strain on the financial resources of the Hellenic Republic, which, moreover, did not call into question the validity of recital 112 of the contested decision, according to which both the interest subsidies and the State guarantees were imputable to it and were granted through State resources.
31 Concerning the State guarantees, the Hellenic Republic denies that the grant of such guarantees by means of the measures at issue had an adverse impact on its resources.
32 It should be pointed out that measures which, in various forms, mitigate the burdens normally included in the budget of an undertaking, and which therefore, without being subsidies in the strict meaning of the word, are similar in character and have the same effect, are considered to be aid (judgment of 19 March 2013, Bouygues and Others v Commission and Others, C‑399/10 P and C‑401/10 P, EU:C:2013:175, paragraph 101).
33 It follows from the case-law that the grant of a guarantee can entail an additional burden on the State (see judgment of 19 March 2013, Bouygues and Others v Commission and Others, C‑399/10 P and C‑401/10 P, EU:C:2013:175, paragraph 107 and the case-law cited). More specifically, a guarantee involves the taking of risk which is normally remunerated by an appropriate fee (see, to that effect, judgment of 3 April 2014, France v Commission, C‑559/12 P, EU:C:2014:217, paragraph 65).
34 In the present case, it has been established that the Hellenic Republic waived its right to receive a fee for the grant of the guarantees under the measures at issue, so that its public resources were affected.
35 That conclusion cannot be called into question by the Hellenic Republic’s arguments – which, moreover, are unsubstantiated – seeking to demonstrate that the guarantees given posed no risk to public resources.
36 At the hearing, the Hellenic Republic confirmed, as stated in recital 28 of the contested decision, that the State guarantee had been activated in respect of more than EUR 6 000 000. It stressed that those sums could be recovered automatically, in the same was as tax debts, and that criminal proceedings could be brought against the debtor, although it did not state how much had it had actually recovered.
37 As regards, specifically, the collateral provided by the beneficiaries of the measures, first of all, it must be observed that the provision of physical collateral was not required as a matter of course for all loans. It is also apparent from the document contained in Annex A 24 to the application that the provision of collateral by the borrower secured only 90% of the State guarantee, so that the State had no assurance that its debt would be repaid in full.
38 Furthermore, it is true that undertakings applying for debt restructuring in respect of more than EUR 100 000 had to submit an economic viability study and that other undertakings had to complete the table contained in Annex A 27 to the application with information including their past accounting and financial data for 2004, 2005 and 2006 and their prospective data for 2007, 2008 and 2009.
39 Nonetheless, as mentioned in recitals 129 and 131 of the contested decision, the economic criteria establishing the cut-off point at which an undertaking was considered to be no longer viable were not determined by the aid schemes in question, so that the Hellenic Republic cannot assert that the guarantees given were exclusively earmarked for viable undertakings and that unviable undertakings did not qualify for them.
40 It follows from paragraphs 29 to 39 above that the Commission did not make an error of assessment in finding, in recitals 111 and 112 of the contested decision, in essence, that the measures at issue had constituted a financial burden for the Hellenic Republic.
41 As regards, second, the condition relating to the existence of an advantage, according to settled case-law, measures which, whatever their form, are likely directly or indirectly to favour certain undertakings or are to be regarded as an economic advantage which the recipient undertaking would not have been able to obtain under normal market conditions are regarded as State aid (see judgments of 2 September 2010, Commission v Deutsche Post, C‑399/08 P, EU:C:2010:481, paragraph 40 and the case-law cited, and of 27 June 2017, Congregación de Escuelas Pías Provincia Betania, C‑74/16, EU:C:2017:496, paragraph 65 and the case-law cited).
42 In particular, according to equally settled case-law, a borrower who has subscribed to a loan guaranteed by the public authorities of a Member State, like the beneficiary of a guarantee who does not have to pay any commission in return, normally obtains an advantage inasmuch as the financial cost that it bears is less than that which it would have borne if it had had to obtain that same financing and that same guarantee at market prices (see judgment of 3 April 2014, France v Commission, C‑559/12 P, EU:C:2014:217, paragraph 96 and the case-law cited).
43 In the present case, the effect of the Hellenic Republic’s intervention was to enable undertakings in the affected areas to obtain loans the interest on which it subsidised in whole or in part or to obtain guarantees which it granted without those undertakings having to pay commission, neither of which the undertakings in question would have been able to obtain without State intervention.
44 The Hellenic Republic nonetheless submits, in essence, that there was no advantage in the present case for the purposes of Article 107(1) TFEU. More specifically, it states that since the measures at issue were granted in the context of a market crisis, they fall within the remit of the State’s social responsibility and that, on account of that situation, they meet a long-term economic rationality test, so that all private operators in a similar situation could have acted in the same way. Based on all those considerations, the Hellenic Republic suggests that such measures could be considered to have been granted under normal market conditions.
45 Those arguments cannot succeed.
46 It should be pointed out that the concept of ‘normal market conditions’, which is used to determine whether an advantage exists, refers to the possibility for the undertaking to obtain on the market the same advantage as that which it derives from the aid, not to the assessment of whether the market is operating as usual or is in crisis (see, to that effect, order of 5 February 2015, Greece v Commission, C‑296/14 P, not published, EU:C:2015:72, paragraph 34).
47 To interpret it otherwise would be tantamount to determining the existence of an advantage on the basis of the grounds for or objective of the aid, which would call into question the objective nature of the concept of advantage and, in consequence, the application of Article 107(1) TFEU (see, to that effect, judgment of 16 July 2014, Greece v Commission, T‑52/12, not published, EU:T:2014:677, paragraphs 66 and 67).
48 Moreover, it must be observed that the Hellenic Republic does not claim that it acted, in the present case, as a private operator and it does not deny that it acted in its capacity as a public authority. Instead, it seeks to suggest that a private operator could have acted in a similar manner in a situation that is as alike as possible to its own, without taking account of the fact that it acted as a public authority.
49 There is no provision in Article 107(1) TFEU that exempts from the classification as State aid an aid which is granted by a Member State in the exercise of its public powers and which meets a long-term economic rationality test or falls within the remit of its social responsibility; all the same, such considerations may be taken into account when assessing the compatibility of a measure with the internal market, under Article 107(2) and (3) TFEU (see, to that effect, judgment of 6 March 2018, Commission v FIH Holding and FIH Erhvervsbank, C‑579/16 P, EU:C:2018:159, paragraphs 63 and 75).
50 The Hellenic Republic cannot therefore rely on the criterion of economic rationality in order to classify the market conditions in which the measures at issue were granted as normal conditions and to conclude that those measures do not confer an advantage on their beneficiaries.
51 It follows from paragraphs 41 to 50 above that the Hellenic Republic has not succeeded in casting doubt on recitals 113 to 116 of the contested decision, in which the Commission essentially found that the beneficiaries of the measures at issue had benefited from them even though they would not have been able to obtain them under normal market conditions, namely in the absence of State intervention, and that there was no need to analyse whether the market was operating as usual or was in crisis to conclude ultimately that those measures constituted an advantage for the purposes of Article 107(1) TFEU.
52 As regards, third, the condition that the advantage must be selective, the Hellenic Republic submits that, contrary to recital 118 of the contested decision, the selectivity criterion is not satisfied in the present case, since the measures at issue were granted to all undertakings established in the affected areas and those undertakings were in a different legal and factual situation from those established elsewhere.
53 The Hellenic Republic denies that the measures at issue are selective, arguing that the differentiation between undertakings which were established in the regions covered by those measures and undertakings which were not is justified by the fact that the former, unlike the latter, were located in areas affected by the 2007 fires and needed to return to the economic level they had before those fires.
54 The differentiation between those two categories of undertaking is thus justified by the fact that the undertakings in each of the two categories were in a situation which was not comparable from a factual and legal standpoint, since, in essence, all undertakings established in the affected areas sustained losses as a result of those fires.
55 Accordingly, the Hellenic Republic disputes the phrase contained in recital 118 of the contested decision stating that fires are part of the economic risk which any undertaking may face. At the hearing, the Hellenic Republic expanded upon that argument, seeking to demonstrate that, in the light of the widespread disruption of the local economy caused by the 2007 fires, the measures at issue were justified by the nature or general scheme of the system of which they formed part, without providing any further details.
56 It must be observed that measures granting an advantage only to certain undertakings determined by reference to their place of establishment are, prima facie, selective (see, to that effect, judgments of 19 September 2000, Germany v Commission, C‑156/98, EU:C:2000:467, paragraph 23, and of 6 September 2006, Portugal v Commission, C‑88/03, EU:C:2006:511, paragraphs 60 and 61).
57 In that regard, unless the aid was granted by an infra-State body with, at its level of competence, sufficient procedural and financial institutional autonomy or by a public undertaking establishing the conditions governing the use of its goods or services, the relevant reference framework is the national framework and the selectivity of a measure which, as here, benefits undertakings established in part of a Member State is assessed by comparison with the undertakings in that State. An advantage limited to undertakings established in part of a Member State may give rise to a selective measure, as it favours certain undertakings over others within that State (see, to that effect, judgments of 19 September 2000, Germany v Commission, C‑156/98, EU:C:2000:467, paragraph 23; of 6 September 2006, Portugal v Commission, C‑88/03, EU:C:2006:511, paragraphs 56 to 58; and of 21 December 2016, Commission v Hansestadt Lübeck, C‑524/14 P, EU:C:2016:971, paragraphs 60 to 66).
58 In the present case, undertakings established in the affected areas were eligible for the measures at issue. First, since, in accordance with the criteria mentioned in paragraph 57 above, the reference framework to be used to assess the selectivity of the measures at issue is the national framework and not the framework of the affected areas and, second, undertakings located elsewhere in the Hellenic Republic were not eligible for those measures, the Court must hold that those measures did not benefit all undertakings located in national territory without distinction and that they are therefore selective at regional level.
59 Moreover, to rule out selectivity solely on the basis of the objective pursued of making good the damage associated with the fires and of putting the economies of the affected areas back on track would exclude a priori any possibility of classifying as ‘selective advantages’ the advantages granted to undertakings established in the areas affected by the 2007 fires. It would be sufficient for public authorities to invoke the legitimacy of the objectives pursued by the adoption of an aid measure for the measure to be regarded as a general measure, outside the scope of Article 107(1) TFEU (see judgment of 16 July 2014, Greece v Commission, T‑52/12, not published, EU:T:2014:677, paragraph 67 and the case-law cited).
60 Consequently, if such an approach were followed, a measure which, as here, pursues the objective of alleviating the situation of undertakings affected by a natural disaster would, as a matter of principle, be non-selective and fall outside the scope of Article 107(1) TFEU from the outset, thereby depriving the exception provided for in Article 107(2)(b) TFEU of all substance.
61 That is, moreover, the context in which the phrase mentioned in paragraph 55 above must be understood.
62 What the Commission meant by that phrase was that the fact that some undertakings had suffered damage as a result of the 2007 fires and the fact that the Hellenic Republic’s intention was to restore those undertakings to the economic situation they had been in before those fires were not sufficient to support the conclusion that the measures at issue did not confer a specific advantage on their beneficiaries and, consequently, did not constitute State aid for the purposes of Article 107(1) TFEU.
63 In that regard, it is true that, according to the case-law, the concept of State aid does not refer to State measures which differentiate between undertakings and are therefore prima facie selective, where that differentiation arises from the nature or general scheme of the system of which they form part (see judgment of 21 June 2012, BNP Paribas and BNL v Commission, C‑452/10 P, EU:C:2012:366, paragraph 101 and the case-law cited).
64 However, the documents in the file and the arguments put forward by the Hellenic Republic at the hearing simply indicate that the purpose of the measures at issue was to deal, on an ad hoc basis, with the aftermath of the fires in the affected areas, without however providing a description of the system relating to those measures. It follows that, contrary to what the Hellenic Republic would like to see acknowledged, those documents and arguments do not in any way establish that the differentiation introduced by the measures resulted from the nature or general scheme of the system of which they formed part and that, therefore, the advantages they conferred were not specific in nature.
65 Accordingly, the Commission did not make an error of law or of assessment in finding, in recitals 117 and 118 of the contested decision, that the measures at issue were selective inasmuch as, in particular, the advantages they conferred on their beneficiaries were geographically limited and did not apply to all undertakings in Greece.
66 In the fourth place, the Hellenic Republic claims, on the basis of statistical data, that the measures at issue do not affect trade between Member States and do not distort competition.
67 In that regard, it must be observed that, according to the case-law, the Commission is not required to establish the existence of a real impact of the aid on trade between Member States and an actual distortion of competition, but is required only to examine whether that aid is capable of affecting such trade and distorting competition (see judgment of 9 June 2011, Comitato ‘Venezia vuole vivere’ and Others v Commission, C‑71/09 P, C‑73/09 P and C‑76/09 P, EU:C:2011:368, paragraph 134 and the case-law cited).
68 Furthermore, as the Court has held in paragraphs 59 and 60 above, the compensatory nature of the measures at issue does not preclude their categorisation as aid, so that the Hellenic Republic’s argument that the measures at issue are intended to restore the situation existing prior to the 2007 fires cannot succeed.
69 The statistical data relied on by the Hellenic Republic relate to gross domestic product and added value obtained in the affected areas, all economic activities taken together. Consequently, those data are not conclusive as regards, more specifically, the situation of operators active in the sector of the economy to which the contested decision relates.
70 It follows that, irrespective of whether it is permissible for a Member State to demonstrate by means of ex post statistical data that there is no effect on trade and no distortion of competition, the statistical data relied on by the Hellenic Republic are not capable of demonstrating that there is no such effect for the undertakings covered by the measures at issue.
71 Finally, as regards the Hellenic Republic’s argument that distressed undertakings were excluded from the measures at issue, besides the considerations mentioned in paragraphs 37 to 39 above, it is sufficient to note, as the Commission points out, that that consideration is irrelevant for the purpose of determining whether the measures at issue were liable to affect trade between Member States and distort competition.
72 It follows from the foregoing that the Hellenic Republic has not cast doubt on the validity of recitals 122 and 123 of the contested decision, which state, in essence, that irrespective of the objective pursued by the measures at issue, since the beneficiaries of those measures would normally have had to bear the costs of the damage resulting from the 2007 fires themselves and since they were active in the highly competitive market for agricultural products and in forestry, sectors that are sensitive to measures favouring undertakings in a particular Member State and, in the present case, to the measures at issue, those measures threatened to distort competition in the internal market and affect trade between Member States, with the result that they constituted State aid.
73 In the light of the foregoing, the first part of the first plea in law must be dismissed.
Second part of the first plea in law, relating to errors of fact and of reasoning
74 By the second part of the first plea, the Hellenic Republic claims that the contested decision is vitiated by errors of fact and of reasoning.
75 The Hellenic Republic maintains that the Commission failed to take account of all relevant information.
76 In particular, the Commission did not take sufficient account of the seriousness of the 2007 fires, which called for exceptional measures, and of the Hellenic Republic’s obligation to pursue a long-term economic policy. Instead, the Commission merely stated, in a formulaic way, that the 2007 fires could be classified as ‘normal commercial risk’. Thus, the contested decision is vitiated by an error of fact and a serious failure to state reasons, which is especially prejudicial because, in this area, the Commission enjoys a broad discretion.
77 The Commission also failed to weigh the seriousness of the situation caused by the 2007 fires against the national provisions adopted to minimise their impact on the financial resources of the Hellenic Republic while kick-starting the economy and, thereby, facilitating the collection of tax revenue.
78 The Commission disputes the arguments put forward by the Hellenic Republic.
79 As regards the alleged failure to state reasons, it is settled case-law that the statement of reasons must be appropriate to the measure at issue and must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted the measure in question, in such a way as to enable the persons concerned to ascertain the reasons for the measure and to enable the competent Court to exercise its power of review (see judgment of 12 September 2017, Anagnostakis v Commission, C‑589/15 P, EU:C:2017:663, paragraph 28 and the case-law cited).
80 Similarly, the requirement to state reasons must be assessed by reference to the circumstances of the case. It is not necessary for the reasoning to go into all the relevant facts and points of law, since the question whether the statement of reasons for a measure meets the requirements of Article 296 TFEU must be assessed with regard not only to its wording but also to its context and to all the legal rules governing the matter in question (see judgment of 12 September 2017, Anagnostakis v Commission, C‑589/15 P, EU:C:2017:663, paragraph 29 and the case-law cited).
81 It should also be added that the obligation to state reasons established by Article 296 TFEU is an essential procedural requirement which must be distinguished from the question whether the reasoning is well founded, which is concerned with the substantive legality of the measure at issue. The reasoning of a decision consists in a formal statement of the grounds on which that decision is based. If those grounds are vitiated by errors, the latter will vitiate the substantive legality of the decision, but not the statement of reasons for it, which may be adequate even though it sets out reasons which are incorrect. It follows that objections and arguments intended to establish that a measure is not well founded are irrelevant in the context of a plea alleging an inadequate statement of reasons or a lack of such a statement (see judgment of 22 October 2020, EKETA v Commission, C‑274/19 P, not published, EU:C:2020:853, paragraph 79 and the case-law cited).
82 In the present case, and as mentioned in paragraphs 52 to 65 above, it transpires from reading recitals 110, 116, 118, 119 and 123 of the contested decision that the Commission rejected the Hellenic Republic’s argument based on the exceptional situation due to the 2007 fires because, in particular and in essence, it took the view, first, that the objective pursued by those measures did not have to be taken into consideration in the context of the application of Article 107(1) TFEU and, second, that irrespective of those circumstances, the beneficiaries of the measures at issue had enjoyed a selective advantage inasmuch as they could not have obtained those measures under normal market conditions.
83 Moreover, and as mentioned in particular in paragraphs 31 to 39, 41 to 43 and 51 above, it transpires from reading recitals 127, 129, 131 and 132 of the contested decision that, as regards the measures relating to the State guarantee, the Commission took the view that those measures constituted State aid inasmuch as, in particular and in essence, first, besides the fact that the guaranteed debtor was not required as a matter of course to provide collateral in favour of the Hellenic Republic, those measures were granted without the beneficiary having to pay a fee for the risk borne by the State and, second, the Hellenic Republic had not demonstrated the existence of any provision excluding distressed undertakings from those measures.
84 It thus follows from paragraphs 82 and 83 above that, in the contested decision, the Commission gave a sufficient statement of its reasons for dismissing the Hellenic Republic’s arguments relating both to the exceptional situation due to the 2007 fires and to the additional collateral provided by borrowers and the exclusion of distressed undertakings as regards State guarantees.
85 Lastly, as regards the Hellenic Republic’s arguments that the Commission, first, disregarded the importance of being able to pursue a long-term economic policy and, second, failed to weigh the economic rationale underlying the measures at issue against the factual circumstances, it must be held that those arguments, besides being indissociable from those set out in the first part of the first plea, which have been dismissed, in so far as they are intended to establish that a measure is not well founded, are irrelevant in the context of a plea alleging an inadequate statement of reasons or a lack of such a statement, in accordance with the case-law mentioned in paragraph 81 above.
86 In the light of the foregoing, the second part of the first plea in law must be dismissed.
Second plea in law: compatibility of the aid schemes under Article 107(2)(b) TFEU
87 By its second plea, raised in the alternative, the Hellenic Republic contends that the aid schemes in question are compatible with the internal market under Article 107(2)(b) TFEU.
88 In that regard, it submits, in the first place, that the Commission was wrong in recitals 62 and 63 of the contested decision to find that the measures at issue had been granted without there being any direct link with the damage sustained as a result of the 2007 fires, even though all the undertakings located in the affected areas had suffered damage and that damage had a direct causal link with the 2007 fires, on account of the complete cessation of the activities of processing and marketing of agricultural products in those areas. That, moreover, was acknowledged by representatives of the EU institutions.
89 The Hellenic Republic claims, in the second place, that the Commission’s assessment in recitals 64 and 146 of the contested decision is incorrect, inasmuch as it disregarded the fact that the measures at issue were not individual measures but aid schemes and, in consequence, did not have to be analysed according to the strict criteria of civil law governing the award of damages.
90 In any event, according to the Hellenic Republic, it is clear that, in the present case, account had to be taken not only of the circumstances, which prevented a precise assessment of the damage suffered by the economic operators, but also of the fact that the measures at issue could never compensate for the damage actually suffered by the undertakings located in the affected areas, irrespective of the fact that the means of production of those undertakings were not directly affected by the 2007 fires.
91 The Hellenic Republic concludes from this that the contested decision must be annulled on account of an error of law and a failure to state reasons.
92 The Commission challenges the arguments put forward by the Hellenic Republic.
93 In that regard, it must be observed that, since it constitutes a derogation from the general principle laid down in Article 107(1) TFEU that State aid is incompatible with the internal market, Article 107(2)(b) TFEU must be interpreted strictly (see, to that effect, judgment of 29 April 2004, Greece v Commission, C‑278/00, EU:C:2004:239, paragraph 81 and the case-law cited).
94 However, that strict interpretation does not mean that the terms in which that derogation is framed should be construed in such a way as to deprive it of its effects. A derogation must be construed in a manner consistent with the objectives that it pursues (see, to that effect and by analogy, judgment of 11 September 2014, Fastweb, C‑19/13, EU:C:2014:2194, paragraph 40 and the case-law cited).
95 Moreover, according to settled case-law, under Article 107(2)(b) TFEU, only disadvantages directly caused by natural disasters or exceptional occurrences qualify for compensation (see judgment of 9 June 2011, Comitato ‘Venezia vuole vivere’ and Others v Commission, C‑71/09 P, C‑73/09 P and C‑76/09 P, EU:C:2011:368, paragraph 175 and the case-law cited).
96 It follows that, even in the case of an aid scheme, like the scheme in the present case, two conditions must be met if the exception laid down in Article 107(2) TFEU is to apply: first, there must be a direct link between the damage caused by the natural disaster and the State aid and, second, there must be an as precise as possible assessment of the damage sustained by the producers concerned (judgment of 11 November 2004, Spain v Commission, C‑73/03, not published, EU:C:2004:711, paragraph 37).
97 In the present case, it is apparent from both the Hellenic Republic’s pleadings and its statements at the hearing that the measures at issue were granted without the beneficiaries having to prove the existence of a causal link between the losses sustained and the 2007 fires.
98 Proceeding on the basis that Article 107(2)(b) TFEU did not require, as regards an aid scheme, like the scheme in the present case, proof of a causal link within the meaning of civil law between the damage suffered and the amount awarded, the Hellenic Republic took the view that, under that article, it was entitled to make the grant of the measures at issue conditional only on the beneficiary of those measures having a place of establishment in one of the affected areas, since all the undertakings established in those areas had sustained losses as a result of the 2007 fires.
99 It is common ground that it is not possible, based on proof alone of a place of establishment in the affected localities, to verify whether the amount of the measures granted exceeded the losses actually sustained by the beneficiaries of those measures due to the natural disaster and, therefore, whether there was overcompensation.
100 Furthermore, at the hearing, the Hellenic Republic confirmed that it could not be ruled out that the measures at issue had also been granted to undertakings which were located in the affected areas but had not suffered damage as a result of the 2007 fires.
101 Thus, since the Hellenic Republic has not proven that the two conditions for the application of Article 107(2)(b) TFEU, referred to in paragraph 96 above, were satisfied, it cannot complain that the Commission failed in the contested decision to apply the exception provided for in that article.
102 Moreover, the fact that representatives of the European Union may have stated that the 2007 fires were unprecedented or that all available means should be deployed to assist those affected and the local economy has no bearing on the lawfulness of the contested decision.
103 Those statements are not such as to exempt the measures at issue from having to satisfy the conditions for the application of Article 107(2)(b) TFEU referred to, in particular, in paragraph 96 above.
104 That conclusion cannot be called into question by the purported urgency with which the Hellenic Republic had to adopt the measures at issue or by the extent of the damage as acknowledged by representatives of the EU institutions.
105 In that connection, as regards the situation of emergency relied on by the Hellenic Republic, it must be observed that the Hellenic Republic has not shown that it was absolutely impossible for it to assess the losses actually sustained as a result of the 2007 fires. Moreover, that is at variance with the Hellenic Republic’s claims, confirmed at the hearing, that when it received applications for the measures at issue, it carried out comprehensive economic studies of the undertakings to which a guarantee was to be granted, in order to check their viability.
106 As regards the scale of the natural disaster, first of all, it must be observed that statements by EU representatives acknowledging the extent of the disaster or indicating that all available means should be deployed to assist those affected and the local economy are not such as to enable the measures at issue to circumvent the conditions for the application of Article 107(2)(b) TFEU.
107 Next, it must be observed that, even if the overall amounts which the Hellenic Republic puts forward are accurate, namely losses totalling more than EUR 2 billion and, as regards the agricultural sector, aid in the amount of EUR 154 million, the statement of those amounts is not such as to establish that the amount of aid received by the beneficiaries was in fact equal to the losses which they sustained individually as a result of the 2007 fires.
108 It follows that the Commission did not commit an error of law or an error of assessment of the facts when, after recalling, in recital 60 of the contested decision, the requirement laid down in Article 107(2)(b) TFEU for there to be a direct causal link between the aid granted and the losses sustained by the beneficiaries of that aid as a result of the natural disaster in question, it essentially found, in recitals 62 to 64 and 146 of the contested decision, that it could not be discerned from the scheme for granting the measures at issue that those measures had actually benefited undertakings which had sustained losses as a result of the 2007 fires or that the amount of such aid corresponded to the losses sustained, since the schemes in question did not contain any methodology for an assessment, which was as precise as possible, of the damage suffered due to the fires, nor did they determine the eligible costs based on that damage.
109 Lastly, since a reading of recitals 62 to 64 and 146 of the contested decision makes it possible to ascertain the reasons for the Commission’s view that the measures at issue did not satisfy the requirements laid down by the exception set out in Article 107(2)(b) TFEU, the request seeking a declaration that the Commission failed to state reasons for its refusal to apply that article to the circumstances of the present case must be dismissed.
110 In the light of the foregoing, the second plea in law must be dismissed.
Third part of the first plea in law and third plea in law
111 By the third part of the first plea, the Hellenic Republic claims breach of the principle of the protection of legitimate expectations.
112 The third plea is divided into two parts.
113 By the first part of the third plea, the Hellenic Republic submits, first of all and in essence, that the Commission’s powers to recover the aid at issue are subject to the expiry of the ten-year limitation period provided for in Article 17(1) of Council Regulation (EU) 2015/1589 of 13 July 2015 laying down detailed rules for the application of Article 108 of the Treaty on the Functioning of the European Union (OJ 2015 L 248, p. 9). The Hellenic Republic goes on to state that the Commission failed to adopt the contested decision within a reasonable time and thus breached the principle of sound administration. Lastly, it asserts that the Commission failed to specify the beneficiaries of the measures at issue in the published notice containing the invitation to submit comments on the examination of the aid schemes, in order to conclude that the Commission breached the principle of legal certainty and the rights of the defence. By the second part of the third plea, the Hellenic Republic claims that the recovery order is contrary to the principles of proportionality and legal certainty.
114 In so far as the arguments alleging breach of the principle of the protection of legitimate expectations addressed in the third part of the first plea overlap with those set out in the first part of the third plea, they should be examined together.
Third part of the first plea and first part of the third plea
115 As regards, in the first place, the limitation period for the recovery of aid, the Hellenic Republic submits that more than ten years elapsed between the adoption of the contested decision in 2019 and the adoption of the aid schemes in question in 2007, with the result that the limitation period laid down in Article 17(1) of Regulation 2015/1589 applies in the present case.
116 In that regard, it should be borne in mind that Article 17(1) of Regulation 2015/1589 provides that the Commission’s powers to recover aid are subject to a limitation period of ten years. That period applies only to relations between the Commission and the Member State to which the Commission’s recovery decision is addressed (judgment of 30 April 2020, Nelson Antunes da Cunha, C‑627/18, EU:C:2020:321, paragraph 33).
117 According to the case-law, the limitation period starts to run from the date on which aid was granted to the beneficiary, not the date on which an aid scheme was adopted. For the purpose of calculating the limitation period, the aid must be regarded as not having been awarded to the beneficiary until the date on which it was in fact received by the beneficiary (judgment of 8 December 2011, France Télécom v Commission, C‑81/10 P, EU:C:2011:811, paragraphs 81 and 82).
118 In the present case, the aid was granted pursuant to the schemes in question between 27 August 2007 and 31 December 2010.
119 In those circumstances, the limitation period started to run on 27 August 2007 at the earliest, which both the Hellenic Republic and the Commission accepted at the hearing.
120 As regards the interruption of the limitation period, which, under Article 17(2) of Regulation 2015/1589, has the effect of causing a new limitation period to start to run, it should be noted that, according to the case-law, Article 12(2) of that regulation, read together with Article 2(2) and Article 5(2) thereof, requires Member States to provide all necessary information following a request to that effect by the Commission and within the time limits set by it. When it addresses a request for information to a Member State, the Commission is informing that State that it has in its possession information concerning aid alleged to be unlawful and, if necessary, that that aid will have to be repaid (judgment of 10 April 2003, Département du Loiret v Commission, T‑369/00, EU:T:2003:114, paragraph 81).
121 Therefore, the simplicity of the request for information does not have the consequence of depriving it of legal effect as a measure capable of interrupting the limitation period laid down in Article 17 of Regulation 2015/1589, irrespective of the fact that that request was not notified to the beneficiaries of the aid (see, to that effect, judgments of 6 October 2005, Scott v Commission, C‑276/03 P, EU:C:2005:590, paragraph 32, and of 10 April 2003, Département du Loiret v Commission, T‑369/00, EU:T:2003:114, paragraph 82).
122 In the present case, it is common ground that, following the complaint which it received on 22 July 2014, the Commission, on 25 July 2014, sent a letter referring in particular to Decision No 36579/B.1666/27-8-2007 of the Minister for Economic Affairs and Finance and Decision No 2/54310/0025/13.09.2007 of the State Secretary for Economic Affairs and Finance. In that letter, the Commission asked the Greek authorities, first, to forward it all the information necessary for the assessment of the compatibility of those measures with Articles 107 and 108 TFEU, next, to indicate whether the measures at issue had benefited undertakings other than Sogia Ellas operating in the agricultural and forestry sectors and, finally, to inform it, where appropriate, of the amount of aid paid.
123 In that regard, it must be observed that, contrary to what the Hellenic Republic may have suggested, the subject matter of the investigation was not altered during the investigation procedure.
124 The letter of 25 July 2014 concerned the two decisions mentioned in paragraph 122 above, which were again mentioned both in the invitation to submit comments pursuant to Article 108(2) TFEU and in the contested decision. Moreover, the list of addressees of the measures at issue was never limited to Sogia Ellas, since, as early as the letter initiating the procedure, the Commission asked the Hellenic Republic whether those measures had benefited other undertakings and, in the invitation to submit comments pursuant to Article 108(2) TFEU, reference was made to other potential beneficiaries in the agricultural and forestry sectors.
125 In any event, because, as mentioned in paragraph 116 above, the limitation period laid down in Article 17(1) of Regulation 2015/1589 applies only to relations between the Commission and the Member State to which the recovery decision is addressed, the Hellenic Republic’s argument that the Commission’s power to recover aid is time-barred with regard to undertakings other than Sogia Ellas must be dismissed as ineffective.
126 It follows that the letter of 25 July 2014, by which the Commission sent a request for information to the Hellenic Republic informing that State that it was in possession of information concerning unlawful aid and that, if necessary, the aid would have to be repaid, interrupted the ten-year limitation period laid down in Article 17(1) of Regulation 2015/1589.
127 Furthermore, in the light of the fact that the limitation period was interrupted on 25 July 2014, it must be held that the Commission’s powers to recover aid were not time-barred on the date of adoption of the contested decision, namely 7 October 2019.
128 As regards the Hellenic Republic’s argument that the fact that the interruption of the limitation period causes a ten-year period to start running afresh enables the Commission to continue the procedure indefinitely, suffice it to note that, in the present case, the Commission did not continue the procedure indefinitely and the Hellenic Republic has not alleged, by way of an objection, the illegality of Article 17(2) of Regulation No 2015/1589.
129 Consequently, the Hellenic Republic’s arguments claiming that the Commission lacked competence to recover the aid at issue owing to the expiry of the limitation period laid down in Article 17(1) of Regulation 2015/1589 must be dismissed.
130 As regards, in the second place, the Hellenic Republic’s arguments that the contested decision was not adopted within a reasonable time, which constitutes a breach of the principle of sound administration, it must be observed that, in accordance with the case-law, where aid has been granted without having been notified, a delay by the Commission in exercising its supervisory powers and ordering recovery of the aid does not render that recovery decision unlawful, except in exceptional cases which show that the Commission manifestly failed to act and clearly infringed its duty of diligence (judgment of 22 April 2008, Commission v Salzgitter, C‑408/04 P, EU:C:2008:236, paragraph 106).
131 In the present case, it is common ground that the duration of the procedure preceding the adoption of the contested decision was essentially due to the fact that the Hellenic Republic did not notify those schemes and their existence was not brought to the Commission’s attention until seven years after the 2007 fires had occurred.
132 In that regard, it must be observed that, as soon as the Commission received the complaint on 22 July 2014, it began its enquiries and, on 25 July 2014, it sent a letter to the Greek authorities seeking information about the alleged aid.
133 Next, following exchanges with the Hellenic Republic, the last of which was dated 11 February 2016, the Commission adopted, on 17 May 2016, the decision to initiate the formal investigation procedure.
134 Finally, the Commission adopted the contested decision on 7 October 2019, following exchanges with the Hellenic Republic, the last of which was dated 21 February 2018.
135 While it is true that the last stage of the procedure preceding the adoption of the contested decision was not particularly expeditious, the fact remains that, in view of the chronology of events between 2014 and the adoption of the contested decision, the Commission cannot be criticised for undue delay or for a lack of diligence in the conduct of the administrative procedure amounting to a breach of its duty of diligence.
136 Consequently, the arguments alleging failure to act within a reasonable time and, therefore, breach of the principle of sound administration must be dismissed.
137 In the third place, as regards the arguments that the notice published by the Commission containing the invitation to submit comments on the examination of the aid schemes in question created the false impression that only aid granted to Sogia Ellas was at issue and that, therefore, the Commission breached the principle of legal certainty and the rights of the defence, it must be observed that, under Article 108(2) TFEU, the Commission is to take its decision ‘after giving notice to the parties concerned to submit their comments’. Article 6(1) of Regulation 2015/1589 provides that the decision to initiate the formal investigation procedure is to call upon the Member State concerned and upon other interested parties to submit comments within a prescribed period which should normally not exceed one month.
138 It is clear from the case-law relating to Article 108(2) TFEU that that provision does not require individual notice to be served and that its sole purpose is to oblige the Commission to take steps to ensure that all persons who may be concerned are notified that a procedure has been initiated and given an opportunity to submit their comments in that regard. In those circumstances, publication of a notice in the Official Journal appears to be an adequate and sufficient means of informing all the parties concerned that a procedure has been initiated (see judgment of 9 April 2014, Greece v Commission, T‑150/12, not published, EU:T:2014:191, paragraph 58 and the case-law cited).
139 It is in that context, that is to say, in order to ascertain whether the beneficiaries of the aid to be recovered could actually be regarded as having been given notice to submit their comments in the administrative procedure, that the Court must examine the Hellenic Republic’s argument that the contested decision is vitiated by a breach of the principle of legal certainty, the rights of the defence and the principle of sound administration, because the notice published in the Official Journal gives the false impression that Sogia Ellas alone was the beneficiary of the alleged aid schemes.
140 In that regard, first of all, it must be observed that the Hellenic Republic does not claim that the decision to initiate the formal investigation procedure itself created that false impression. In its arguments, the Hellenic Republic merely criticises the notice published in the Official Journal at the same time as the publication of that decision.
141 Next, it is true that the title of the notice is worded ‘Aid to Sogia Ellas AE’, to which the words ‘et al.’ are added using Latin script, so that, as the Hellenic Republic maintains, that title may indeed give the impression that the aid under examination relates only to Sogia Ellas.
142 However, it is clear from paragraph 1 of the summary forming part of the notice that the preliminary examination led the Commission to conclude that ‘aid could have been granted to other beneficiaries in the agricultural and forestry sectors as well’. Paragraph 2 of that summary sets out the legal bases of the aid schemes and states that the aid was granted to undertakings established and operating in the regions of Greece affected by the 2007 fires.
143 Given that the notice, including the summary forming part of it, is only two pages long, a diligent economic operator may reasonably be required to study such a document, which makes clear, with reference to the considerations mentioned in paragraph 142 above, that the invitation to submit comments was not limited exclusively to Sogia Ellas, but was directed at all producers established in the affected areas which had received that aid.
144 Accordingly, the Court must conclude that, in accordance with the case-law referred to in paragraph 138 above, a diligent economic operator having benefited from the aid schemes in question was sufficiently informed by the notice published with the decision to initiate the formal investigation procedure in the Official Journal to be able to consider itself to be a party concerned by that decision.
145 At the hearing, the Hellenic Republic also confirmed the content of recital 103 of the contested decision, inasmuch as it stated that, in the light of the difficulties it had in identifying the ‘beneficiaries operating … in the agricultural and forestry sectors’, it had considered that the publication of the opening decision in the Official Journal was sufficient to alert the undertakings concerned.
146 Accordingly, the Court must reject the arguments that the notice published by the Commission containing the invitation to submit comments on the examination of the aid schemes in question created the false impression that it related to aid granted only to Sogia Ellas and that, therefore, the Commission infringed the principle of legal certainty and the rights of the defence.
147 As regards, in the fourth and last place, the Hellenic Republic’s argument that both that State and the beneficiaries entertained a legitimate expectation that the measures at issue were not incompatible State aid because, for a considerable period of time, the Commission did not express any concerns about the legality of those measures, despite being aware of the situation caused by the 2007 fires, it must be observed that, in accordance with settled case-law, the right to rely on the principle of the protection of legitimate expectations presupposes that precise, unconditional and consistent assurances originating from authorised, reliable sources have been given to the person concerned by the competent authorities of the European Union (see judgment of 13 July 2018, Quadri di Cardano v Commission, T‑273/17, EU:T:2018:480, paragraph 109 and the case-law cited).
148 Moreover, it is common ground that a Member State whose authorities have granted aid contrary to the procedural rules laid down in Article 108 TFEU may not rely on the legitimate expectations of recipients in order to justify a failure to comply with the obligation to take the steps necessary to implement a Commission decision instructing it to recover the aid. If it could do so, Articles 107 and 108 TFEU would be rendered ineffective, since national authorities would thus be able to rely on their own unlawful conduct in order to deprive decisions taken by the Commission under provisions of the Treaty of their effectiveness (see judgment of 19 June 2008, Commission v Germany, C‑39/06, not published, EU:C:2008:349, paragraph 24 and the case-law cited).
149 In the present case, it must be observed that the remarks of various EU representatives mentioned by the Hellenic Republic, which essentially refer to the exceptional nature of the fires and the ensuing aftermath and to their intention to deploy all available means to assist those affected and the local economy, cannot be regarded as constituting ‘precise, unconditional and consistent assurances’ from which it follows that the measures at issue cannot be classified as State aid.
150 Moreover, besides the fact that, for the reasons set out in paragraphs 130 to 136 above, the Commission cannot be criticised for not having adopted the contested decision within a reasonable time, it is common ground that the Hellenic Republic did not notify the aid schemes in question in good time, so that it cannot validly plead, for the reasons set out in paragraphs 147 and 148 above, breach of the principle of the protection of legitimate expectations.
151 Consequently, the arguments claiming breach of the principle of the protection of legitimate expectations must be dismissed.
152 It follows that the third part of the first plea in law, alleging breach of the principle of the protection of legitimate expectations, and the first part of the third plea in law, alleging lack of competence ratione temporis and breach of the principle of sound administration, the principle of legal certainty and the rights of the defence, must be rejected.
Second part of the third plea in law
153 By the second part of the third plea, the Hellenic Republic submits that the obligation to recover the aid, set out in Article 2 of the contested decision, is contrary to the principles of proportionality and legal certainty.
154 In that regard, the Hellenic Republic claims that the exceptional circumstances surrounding the measures at issue mean that the aid in question is not recoverable.
155 In the first place, the aid schemes in question did not give rise to ‘advantages’ and were intended only to ensure the survival of the market concerned.
156 In the second place, the fact that aid is to be recovered only in the agricultural sector is liable to create an imbalance to the detriment of that sector, even though the Member of the Commission responsible for agriculture stated that the Commission would provide increased support to that sector.
157 The Commission disputes all of the arguments put forward by the Hellenic Republic.
158 In that regard, it must be recalled that Article 16(1) of Regulation 2015/1589 provides that where negative decisions are taken in cases of unlawful aid, the Commission is to decide that the Member State concerned must take all necessary measures to recover the aid from the beneficiary, unless recovery would be contrary to a general principle of EU law.
159 Furthermore, according to settled case-law, the removal of unlawful aid by means of recovery is the logical consequence of a finding that it is unlawful and the aim of obliging the Member State to abolish aid found by the Commission to be incompatible with the internal market is to restore the previous situation (see judgment of 14 February 2008, Commission v Greece, C‑419/06, not published, EU:C:2008:89, paragraph 53 and the case-law cited).
160 By repaying the aid, the beneficiary forfeits the advantage which it had enjoyed over its competitors in the internal market, and the situation prior to payment of the aid is restored (see judgment of 14 February 2008, Commission v Greece, C‑419/06, not published, EU:C:2008:89, paragraph 54 and the case-law cited).
161 The recovery of State aid unlawfully granted, for the purpose of restoring the situation existing prior to that grant, cannot, therefore, in principle be regarded as disproportionate to the objectives of the provisions of the Treaty on State aid (see judgment of 14 February 2008, Commission v Greece, C‑419/06, not published, EU:C:2008:89, paragraph 55 and the case-law cited).
162 In the present case, in the first place, as held in paragraphs 41 to 51 above, the measures at issue constitute an advantage for those who received them, even if they were paid as a result of exceptional circumstances characterised by a natural disaster, and, as held, inter alia, in paragraphs 136 and 151 above, recovery of the aid is not contrary to a general principle of law.
163 In the second place, since the scope of the contested decision is expressly limited to the agricultural and forestry sectors, and since the Hellenic Republic has not claimed that the Commission should have extended that decision to other sectors of the economy and did not notify such aid, it cannot criticise the Commission for ordering recovery of the aid only from the beneficiaries specified in the contested decision.
164 Finally, it is true that, at the Council of Ministers of 26 September 2007, the Member of the Commission responsible for agriculture informed the Greek delegation of the various tools available (State aid, regional aid, rural development) and stated, in particular, that agricultural areas eligible for the single payment would remain eligible.
165 However, although those statements concern the 2007 fires, they cannot usefully support the Hellenic Republic’s arguments in that regard because they are unrelated to the assessment of the legality of the recovery order.
166 In the light of the foregoing, the third part of the first plea in law and the third plea in law must be dismissed, and, in consequence, the action must be dismissed in its entirety.
Costs
167 Under Article 134(1) of the Rules of Procedure of the General Court, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Since the Hellenic Republic has been unsuccessful, it must be ordered to pay the costs, in accordance with the form of order sought by the Commission.
On those grounds,
THE GENERAL COURT (First Chamber)
hereby:
1. Dismisses the action;
2. Orders the Hellenic Republic to pay the costs.
Delivered in open court in Luxembourg on 19 October 2022.
[Signatures]