JUDGMENT OF THE COURT

2 April 1998 (1)

(Appeal — State aid — Complaint by a competitor — Commission's obligationsconcerning the investigation of a complaint and the provision of reasons forrejecting it)

In Case C-367/95 P,

Commission of the European Communities, represented by Jean-Louis Dewost,Director-General of its Legal Service, Jean-Paul Keppenne and Michel Nolin, ofits Legal Service, acting as Agents, with an address for service in Luxembourg atthe office of Carlos Gómez de la Cruz, of its Legal Service, Wagner Centre,Kirchberg,

appellant,

supported by

French Republic, represented by Catherine de Salins, Deputy Director in the LegalAffairs Directorate of the Ministry of Foreign Affairs, and Jean-Marc Belorgey,chargé de mission in the same directorate, acting as Agents,

intervener in the proceedings at first instance,

and

Federal Republic of Germany, represented by Ernst Röder, Ministerialrat in theFederal Ministry of Economic Affairs, and Bernd Kloke, Regierungsrat in thatMinistry, acting as Agents,

Kingdom of Spain, represented by Gloria Calvo Díaz, Abogado del Estado, actingas Agent,

Kingdom of the Netherlands, represented by Marc Fierstra, Assistant Legal Adviserin the Ministry of Foreign Affairs, acting as Agent,

interveners,

APPEAL against the judgment of the Court of First Instance of the EuropeanCommunities (Fourth Chamber, Extended Composition) of 28 September 1995 inCase T-95/94 Sytraval and Brink's France v Commission [1995] ECR II-2651,seeking to have that judgment set aside,

the other parties to the proceedings being:

Chambre Syndicale Nationale des Entreprises de Transport de Fonds et Valeurs(Sytraval) and Brink's France SARL,

THE COURT,

composed of: G.C. Rodríguez Iglesias, President, C. Gulmann (Rapporteur),H. Ragnemalm, M. Wathelet (Presidents of Chambers), G.F. Mancini,J.C. Moitinho de Almeida, P.J.G. Kapteyn, J.L. Murray, D.A.O. Edward,J.-P. Puissochet, G. Hirsch, P. Jann and L. Sevón, Judges,

Advocate General: C.O. Lenz,

Registrar: R. Grass,

having regard to the report of the Judge-Rapporteur,

after hearing the Opinion of the Advocate General at the sitting on 27 May 1997,

gives the following

Judgment

1.

    By application lodged at the Registry of the Court of Justice on 28 November 1995,the Commission of the European Communities brought an appeal pursuant to

Article 49 of the EC Statute of the Court of Justice against the judgment of28 September 1995 in Case T-95/94 Sytraval and Brink's France v Commission[1995] ECR II-2651 ('the contested judgment‘), in which the Court of FirstInstance annulled the Commission's decision of 31 December 1993 ('the contesteddecision‘) rejecting the request of the Chambre Syndicale Nationale desEntreprises de Transport de Fonds et Valeurs (Sytraval) and of Brink's FranceSARL for a declaration that the French Republic had infringed Articles 92 and 93of the EC Treaty by granting aid to Sécuripost SA ('Sécuripost‘).

2.

    The French Republic, which intervened in the proceedings at first instance insupport of the form of order sought by the Commission, has lodged a reply. TheChambre Syndicale Nationale des Entreprises de Transport de Fonds et Valeurs(Sytraval) and Brink's France SARL ('the complainants‘) have not submitted anyobservations to the Court.

3.

    By three applications lodged at the Registry of the Court of Justice on 24 January,22 February and 26 February 1996, the Federal Republic of Germany, theKingdom of Spain and the Kingdom of the Netherlands sought leave to intervenein support of the form of order sought by the Commission. Those applicationswere granted by three orders of the Court of 5 March 1996.

Facts and procedure before the Court of First Instance

4.

    The contested judgment states that, until 1987, the French post office ('the postoffice‘) undertook, through its internal departments, the transportation of its ownmoneys and valuables. In 1986 the post office decided to carry on certain of itsactivities through the intermediary of commercial companies. On 16 December1986 the Société Holding des Filiales de la Poste ('Sofipost‘), controlled as to 99%by the French Republic, was accordingly set up. On 16 April 1987 Sofipost formedSécuripost SA ('Sécuripost‘), which it controls as to 99.92%. The object of thatcompany is the secure transportation of moneys, the provision of caretaking andprotection services, and surveillance. The post office seconded over 220 officialsto Sécuripost.

5.

    By agreement under private law dated 28 September 1987, the post office entrustedSécuripost with the performance of the activities falling within the spheres referredto above, which it had previously carried on itself. Thereafter, Sécuripost was towiden its customer base and its range of activities. On 30 September 1987 aframework agreement was concluded between the Minister of Posts andTelecommunications and Sécuripost. Between 1987 and 1989 Sofipost granted twoloans to Sécuripost, in the sums of FF 5 000 000 and FF 15 000 000, and increasedthe latter's capital.

6.

    On 4 September 1989 various French undertakings and associations ofundertakings, including the complainants, submitted to the Commission tworequests for the initiation of a proceeding, one made pursuant to Articles 85, 86and 90 of the EEC Treaty, and the other pursuant to Articles 92 and 93 of thatTreaty. The present case concerns only the second of those requests.

7.

    Acting on that complaint, the Commission sought an explanation from the FrenchGovernment by letter of 14 March 1990. The French Government replied by letterof 3 May 1990.

8.

    On 28 June 1991 the Commission informed the complainants that their complaintraised 'a number of important points of principle calling, in this instance, for anin-depth examination by the relevant Commission departments‘. On 9 October1991 the Commission again informed the complainants that the matter raised bythem appeared 'particularly complex, necessitating extensive technical analysis ofthe ample documentation produced both by the complainants and by the Frenchauthorities ...‘.

9.

    On 5 February 1992 the Commission adopted a decision in which it stated that itcould not be said that there had been a grant of State aid within the meaning ofArticle 92 of the Treaty. It found, in particular, that, on the basis of the evidenceat its disposal, the operation which had led to the formation of Sécuripost wascomparable to a reorganisation carried out by an undertaking which has decidedto set up a subsidiary to manage one of its activities separately.

10.

    On 13 April 1992 the complainants brought an action under Article 173 of the ECTreaty for annulment of that decision. However, on 22 June 1992 the Commissionwithdrew its decision of 5 February 1992 and that action therefore became devoidof purpose.

11.

    On 24 July 1992 the complainants supplemented the complaint which they hadmade to the Commission. On 21 January 1993 the Commission informed them thatit had entered the measures taken by the French Government with regard toSécuripost in the register of unnotified aids.

12.

    On 26 March 1993 the French Government authorised Sofipost to transferSécuripost's property to the private sector. On 22 April 1993 the complainantsagain supplemented their complaint. On 5 May 1993 the Commission informedthem that it had decided to divide the inquiry into the matter into two parts,dealing respectively with the situation before and after the privatisation.

13.

    On 11 October 1993 the complainants called upon the Commission, pursuant toArticle 175 of the EC Treaty, to adopt a decision in response to their complaintsubmitted on 4 September 1989.

14.

    On 31 December 1993 the Commission — represented by its Member responsiblefor competition matters — wrote to the French Government, informing it, withoutproviding any specific statement of reasons, that it had decided, on the basis of theevidence at its disposal, to close the file by declaring that no State aid existedwithin the meaning of Article 92(1) of the Treaty. It emphasised, however, that itsdecision did not extend to the measures taken since 1992 in the context of theprivatisation of Sécuripost.

15.

    On the same day, the Commission — again represented by its Member responsiblefor competition matters — wrote to the complainants, informing them, in responseto the arguments which they had advanced, that the investigation which it hadcarried out provided no grounds for concluding that State aid within the meaningof Article 92 of the Treaty had been granted in this case, and that it had thereforedecided to close the file.

16.

    By application of 2 March 1994 the complainants brought an action before theCourt of First Instance for annulment of that decision.

17.

    They relied on four pleas in law in support of their action. The first plea wasbased on infringement of Article 93(2) of the Treaty, in that the Commission hadwrongly decided, having regard to the circumstances of the case, not to initiate theprocedure provided for by that provision. The second plea alleged breach of thecomplainants' right to a fair hearing, in that the Commission referred in its decision— which adversely affected them — to documents which had not been communicatedto them, such as the observations of the French Government. The third pleaalleged infringement of Article 190 of the EC Treaty, in that the Commission hadfailed to respond in the contested decision to the objections raised by thecomplainants in their complaint concerning (1) the secondment to Sécuripost ofadministrative staff of the post office, (2) the placing at the disposal of Sécuripostof post office premises, (3) the supply of fuel and maintenance for vehicles onexcessively favourable terms and (4) the loan of FF 15 000 000 granted by Sofipostto Sécuripost at a preferential rate. The fourth plea alleged the existence ofmanifest errors of assessment concerning the way in which the decision dealt withthe increase of FF 9 775 000 in the capital of Sécuripost, advances made againstorders placed by the post office with Sécuripost and abnormal charges applied andguarantees provided to it by the post office.

The contested judgment

18.

    According to the contested judgment, the complainants' action sought annulmentof the contested decision 'rejecting the applicants' request for a declaration by theCommission that the French Republic has infringed Articles 92 and 93 of theTreaty by granting aid to Sécuripost‘.

19.

    The Court of First Instance began from the position, stated at paragraph 32 of thecontested judgment, that it was appropriate, in the light of the documents in thecase, to focus its examination jointly on the third and fourth pleas, alleginginfringement of Article 190 of the Treaty and manifest error of assessment.

20.

    Next, in paragraph 51, it found, first, that the contested decision was a decision ofthe Commission rejecting the complainants' allegations on the ground that themeasures complained of did not constitute State aid within the meaning of Article92 of the Treaty and, second, that it was common ground that the contesteddecision was a decision within the meaning of the fourth paragraph of Article 189of the Treaty and that it should therefore have contained a statement of reasonspursuant to Article 190 of the Treaty. Consequently, the Court of First Instanceconsidered, in paragraph 53, that it was necessary to verify whether the contesteddecision disclosed in a clear and unequivocal manner the reasoning which had ledthe Commission to conclude that the measures complained of by the complainantsdid not constitute State aid within the meaning of Article 92 of the Treaty, in sucha way as to make the complainants aware of the reasons for the rejection of theircomplaint and thus enable them to defend their rights and the Court of FirstInstance to exercise its power of review.

21.

    The Court of First Instance stated in that regard, in paragraph 54, that the judicialreview which such a statement of reasons must allow was not, in the instant case,a review of the question whether there had been a manifest error of assessment,similar to a review of the exercise by the Commission of its exclusive power toexamine the compatibility of national measures already found to constitute Stateaid, but a review of the interpretation and application of the concept of State aidreferred to in Article 92 of the Treaty which the Commission had undertaken witha view to determining whether or not the national measures complained of by thecomplainants were to be classified as State aid.

22.

    In paragraph 55, the Court of First Instance considered that it was necessary tobear in mind the context within which the contested decision had been adopted,since the question whether or not a statement of reasons is adequate must beassessed with regard not only to its wording but also to its context. The Court ofFirst Instance made four points in that regard: first, the contested decision hadbeen adopted after a particularly long period of time had elapsed (paragraph 56);second, the Commission had stated in its correspondence with the complainantsthat their complaint raised a number of important points of principle calling for anin-depth examination and extensive technical analysis (paragraph 57); third, theCommission had withdrawn its initial decision of 5 February 1992 in response to theaction for annulment brought by the complainants, even though that action merelyrepeated the various objections raised in their original complaint, without raisingany new objections (paragraph 58); and, fourth, the Commission had entered themeasures complained of in the register of unnotified aid and had expressed regret,in a letter to the French Government, that no advance notice had been given

pursuant to Article 93(3) of the Treaty in relation to any of the measures taken(paragraph 59).

23.

    In the light of those findings, the Court of First Instance considered, inparagraph 60, that it was necessary to examine whether, in the case before it, thereasons set out in the contested decision were capable of supporting the contentionthat the measures complained of by the complainants did not constitute State aidwithin the meaning of Article 92 of the Treaty.

24.

    It concluded in that regard that, as regards the complainants' objection concerningthe secondment of administrative staff, the contested decision was vitiated by aninadequate statement of reasons (paragraphs 62 and 63) and that, as regards theobjections relating to the placing of premises at Sécuripost's disposal(paragraphs 65 and 66), the maintenance of vehicles (paragraph 69), the loan ofFF 15 000 000 (paragraph 72) and the prices charged by Sécuripost to the postoffice (paragraphs 74 to 76), the reasons given for that decision were insufficient.

25.

    In that connection, the Court of First Instance considered, in paragraphs 66 and 72,that, where the Commission decides to reject a complaint concerning a measurecharacterised by the complainant as unnotified State aid, without allowing thecomplainant to comment, prior to the adoption of the definitive decision, on theinformation obtained in the context of the Commission's investigation, it is underan automatic obligation to examine the objections which the complainant wouldcertainly have raised if it had been given the opportunity of taking cognisance ofthat information.

26.

    The Court of First Instance considered, moreover, in paragraph 78, that theCommission's obligation to state reasons for its decisions may in certaincircumstances require an exchange of views and arguments with the complainant,since, in order to justify to the requisite legal standard its assessment of the natureof a measure characterised by the complainant as State aid, the Commission needsto ascertain what view the complainant takes of the information obtained by it inthe course of its inquiry. The Court of First Instance considered that, in thosecircumstances, that obligation constitutes a necessary extension of the Commission'sobligation to deal diligently and impartially with its inquiry into the matter byeliciting all such views as may be necessary.

27.

    Finally, in paragraph 80, the Court of First Instance held that the contesteddecision must be annulled, since the reasons stated for the decision did not bearout the conclusion that the measures complained of by the complainants did notconstitute State aid within the meaning of Article 92 of the Treaty.

The appeal

28.

    The Commission claims that the Court should:

—    set aside the contested judgment and, in consequence of that, take allrequisite legal steps and, in particular, refer the case back to the Court ofFirst Instance for a decision on the merits; and

—    order the applicants in the proceedings before the Court of First Instanceto pay the costs.

29.

    The French Republic claims that the Court should:

—    allow the Commission's appeal and set aside the contested judgment; and

—    grant the form of order sought by the Commission in the proceedings atfirst instance.

30.

    The Federal Republic of Germany, the Kingdom of Spain and the Kingdom of theNetherlands also claim that the Court should allow the Commission's appeal.

31.

    The Commission advances three pleas in law in support of its appeal. It submitsthat the Court of First Instance erred in law:

—    as to the addressee of a decision concerning State aid;

—    as to the scope of the obligation to provide a statement of reasons; and

—    as to the procedural rules to be followed in dealing with State aid cases.

32.

    In the Commission's submission, the Court of First Instance failed to take properaccount of the legal framework established by the Treaty with regard to State aidand disregarded the case-law of the Court of Justice relating thereto. Where, asin the present case, the Commission makes a decision concerning the existence ofState aid objected to in a complaint, the complainant enjoys no special rights andcan contest the legality of that decision only on the same basis as any otherapplicant to whom it is of direct and individual concern.

Findings of the Court

The system established by the Treaty for monitoring State aid

33.

    Before examining the pleas relied on in the appeal, it is appropriate to recall therelevant rules under the system established by the Treaty for monitoring State aid.

34.

    Article 92(1) of the Treaty provides that, '[s]ave as otherwise provided in thisTreaty, any aid granted by a Member State or through State resources in any form

whatsoever which distorts or threatens to distort competition by favouring certainundertakings or the production of certain goods shall, in so far as it affects tradebetween Member States, be incompatible with the common market.‘

35.

    Article 93 of the Treaty provides for a special procedure by which the Commissionis to keep State aid under constant review. As regards proposed new grants of aidby the Member States, it establishes a procedure which must be followed beforeany aid can be regarded as lawfully granted. Under the first sentence ofArticle 93(3) of the Treaty, as interpreted by the case-law of the Court, theCommission is to be notified of any plans to grant or alter aid before those plansare implemented.

36.

    The Commission then conducts an initial review of the planned aid. If at the endof that review it considers a plan to be incompatible with the common market, itmust without delay initiate the procedure under the first paragraph of Article 93(2),which provides: 'If, after giving notice to the parties concerned to submit theircomments, the Commission finds that aid granted by a State or through Stateresources is not compatible with the common market having regard to Article 92,or that such aid is being misused, it shall decide that the State concerned shallabolish or alter such aid within a period of time to be determined by theCommission.‘

37.

    It follows from the last sentence of Article 93(3) that throughout the preliminaryperiod the Member State concerned may not put the planned aid into effect. Where the examination procedure is initiated under Article 93(2), that prohibitioncontinues until the Commission reaches a decision on the compatibility of theplanned aid with the common market. However, if the Commission has notresponded within two months of notification, the Member State concerned mayimplement the plan after informing the Commission (see, in particular,Case C-39/94 SFEI and Others [1996] ECR I-3547, paragraph 38).

38.

    In the context of the procedure laid down by Article 93, the preliminary stage ofthe procedure for reviewing aid under Article 93(3) of the Treaty, which is intendedmerely to allow the Commission to form a prima facie opinion on the partial orcomplete conformity of the aid in question, must therefore be distinguished fromthe examination under Article 93(2), which is designed to enable the Commissionto be fully informed of all the facts of the case (Case C-198/91 Cook v Commission[1993] ECR I-2487, paragraph 22, and Case C-225/91 Matra v Commission [1993]ECR I-3203, paragraph 16).

39.

    The procedure under Article 93(2) is essential whenever the Commission hasserious difficulties in determining whether an aid is compatible with the commonmarket. It follows that the Commission, when taking a decision in favour of an aid,may restrict itself to the preliminary examination under Article 93(3) only if it isable to satisfy itself after an initial examination that the aid is compatible with the

Treaty. If, on the other hand, the initial examination leads the Commission to theopposite conclusion or if it does not enable it to overcome all the difficultiesinvolved in determining whether the aid is compatible with the common market,the Commission is under a duty to carry out all the requisite consultations and forthat purpose to initiate the procedure under Article 93(2) (see, in particular,Case 84/82 Germany v Commission [1984] ECR 1451, paragraph 13, and thejudgments, cited above, in Cook v Commission, paragraph 29, and Matra vCommission, paragraph 33).

40.

    Where, without initiating the procedure under Article 93(2), the Commission finds,on the basis of Article 93(3), that an aid is compatible with the common market,the persons intended to benefit from the procedural guarantees provided byArticle 93(2) may secure compliance therewith only if they are able to challengethat decision by the Commission before the Court (see, in particular, Cook vCommission, paragraph 23, and Matra v Commission, paragraph 17).

41.

    The parties concerned, within the meaning of Article 93(2) of the Treaty, who, aspersons directly and individually concerned, are thus entitled under the fourthparagraph of Article 173 of the Treaty to institute proceedings for annulment arethose persons, undertakings or associations whose interests might be affected by thegrant of the aid, in particular competing undertakings and trade associations (see,in particular, Case 323/82 Intermills v Commission [1984] ECR 3809, paragraph 16).

42.

    It is in the light of those legal elements that the three pleas in law advanced by theCommission in support of its appeal must be considered.

The first plea

43.

    By its first plea, the Commission submits that, in holding that the contested decisionconstituted a rejection of a complaint, the Court of First Instance misconstrued thenature of that decision. The Commission and the four intervening Member Statesmaintain that the only decisions which the Commission may take under Articles 92and 93 of the Treaty are decisions addressed to a Member State concerning theexistence or compatibility of aid. Where, in performance of its duty to observe theprinciple of sound administration, the Commission communicates its decision to acomplainant, that communication cannot as such constitute a decision addressedto the complainant. As Community law now stands, there is no such category ofdecisions in the sphere of State aid as decisions rejecting a complaint.

44.

    As the Court of First Instance observed in paragraph 50 of the contested judgment,neither the Treaty nor Community legislation lays down the procedural system fordealing with complaints objecting to grants of State aid.

45.

    In those circumstances, decisions adopted by the Commission in the field of Stateaid must be held to be addressed to the Member States concerned. That is also

so where such decisions concern State measures to which objection is taken incomplaints on the ground that they constitute State aid contrary to the Treaty andthe Commission refuses to initiate the procedure under Article 93(2) because itconsiders either that the measures complained of do not constitute State aid withinthe meaning of Article 92 of the Treaty or that they are compatible with thecommon market. Where the Commission adopts such a decision and proceeds, inaccordance with its duty of sound administration, to inform the complainants of itsdecision, it is the decision addressed to the Member State which must form thesubject-matter of any action for annulment which the complainant may bring, andnot the letter to that complainant informing him of the decision.

46.

    Consequently, whilst it may be regrettable that the Commission did not inform thecomplainants of its position by sending them a copy of a properly reasoned decisionaddressed to the Member State concerned, the Court of First Instance erred in lawin finding that the contested decision constituted a decision addressed not to thatState but to the complainants, rejecting their application for a declaration by theCommission that the French Republic had infringed Articles 92 and 93 of theTreaty by granting the aid to Sécuripost.

47.

    The error of law thus committed by the Court of First Instance does not, however,invalidate its judgment, since, as the Commission has conceded, the decision inquestion was of direct and individual concern to the complainants. In finding in itsdecision that the investigation had revealed no grounds for concluding that Stateaid existed within the meaning of Article 92 of the Treaty, the Commissionimplicitly refused to initiate the procedure under Article 93(2). It follows from thejudgments of the Court cited in paragraphs 40 and 41 above that, in such asituation, the persons intended to benefit from the procedural guarantees affordedby Article 93(2) may secure compliance therewith only if they are able to challengethe decision in question before the Community judicature under the fourthparagraph of Article 173 of the Treaty. That principle is of equal application,whether the ground on which the decision is taken is that the Commission regardsthe aid as compatible with the common market or that, in its view, the veryexistence of aid must be discounted.

48.

    Since the complainants undeniably qualify as persons entitled to the benefit of theprocedural guarantees in question, they must, as such, be regarded as directly andindividually concerned by the contested decision. Consequently, they were entitledto seek its annulment (Cook v Commission, paragraphs 25 and 26).

49.

    In the light of those considerations, it must be held that, by holding that, in thecircumstances of the present case, the contested decision was a decision addressedto the complainants rejecting their application for a declaration by the Commissionthat Articles 92 and 93 of the Treaty had been infringed, the Court of FirstInstance did not commit an error in law such as to invalidate its judgment.

The second and third pleas

50.

    By its second and third pleas, the Commission submits that the error of the Courtof First Instance as to the addressee of the Commission's decision resulted in anincorrect assessment of the obligations to state reasons and to investigatecomplaints.

51.

    Whilst acknowledging that, regardless of the addressee, it is obliged to provide astatement of reasons permitting the legality of the decision to be reviewed, andthat, as regards the complainants, it was bound to examine all the facts and pointsof law which they brought to its notice, the Commission submits that the Court ofFirst Instance was wrong in assessing the scope of the obligation to state reasonsas if the complainants were the addressees of its decision.

52.

    Thus, the Commission maintains that the Court of First Instance committed anerror of law in holding, in paragraph 53 of the contested judgment, that thecontested decision should have disclosed reasons in such a way as to make thecomplainants aware of the grounds for the rejection of their complaint and thusenable them to defend their rights. It maintains that a complainant whosubsequently pleads, in annulment proceedings, the insufficiency of the reasonsgiven for a decision must be able to do so only on the same basis as any otherapplicant to whom that decision is of direct and individual concern.

53.

    The Commission further maintains that, whilst it is true that respect for the rightsof the defence in any procedure initiated against a person which may result in anact adversely affecting him constitutes a fundamental principle of Community law,nevertheless, in State aid cases it is only the Member State concerned which findsitself in such a situation, and it is therefore only that State which must formally becalled upon to express its point of view regarding the comments submitted byinterested third parties.

54.

    Next, the Commission states that, in consequence of that misinterpretation of theimport of the contested decision, the Court of First Instance conferred new rightson complainants by taking the view that the Commission is obliged of its ownmotion to examine the objections which a complainant would certainly have raisedhad he been given the opportunity of taking cognisance of that information, andthat the obligation to state reasons may in certain circumstances require anexchange of views and arguments with the complainant. If the scope of theinvestigation were to encompass all the hypothetical objections which an 'idealcomplainant‘ would certainly raise, as envisaged by the Court of First Instance, theCommission would be systematically obliged to conduct such an exchange of viewsand arguments in every case.

55.

    Lastly, the Commission maintains that, in the present case, the Court of FirstInstance carried out, in the guise of a review of the statement of reasons provided,what in fact amounted to a review of the error of assessment, thereby treating the

purely procedural requirement to state reasons as a matter concerning thesubstantive legality of the decision. The real criticism levelled by the Court of FirstInstance at the Commission was that it had committed a manifest error ofassessment attributable to the inadequacy of the investigation carried out by thatinstitution.

56.

    The four intervening Member States put forward, in essence, the same argumentsas the Commission. The Federal Republic of Germany observes, however, that,where the Commission decides to close the preliminary review procedure underArticle 93(3) and chooses to do so by way of a decision within the meaning ofArticle 189 of the Treaty, it is not obliged to furnish any statement of reasons, sincethe preliminary review procedure is not conducted inter partes and thus confers nolegal protection on complainants.

57.

    Having regard to those arguments, it is necessary to examine the scope of theobligations incumbent of the Commission when it receives a complaint objectingto national measures such as State aid.

58.

    As regards, first, the proposition that the Commission is under an obligation incertain circumstances to conduct an exchange of views and arguments with thecomplainant, flowing, according to the contested judgment, from the Commission'sobligation to state reasons for its decisions, it must be stated that there exists nobasis for the imposition of such an obligation on the Commission.

59.

    As the Advocate General notes at point 83 of his Opinion, such an obligationcannot be founded solely on Article 190 of the Treaty. Moreover, as theCommission and the interveners have observed, it follows from the judgments citedin paragraphs 38 and 39 of this judgment that the Commission is not obliged togive the complainants an opportunity to state their views at the stage of the initialreview provided for by Article 93(3) of the Treaty. Furthermore, those judgmentsshow that, in the context of an examination under Article 93(2), the Commissionis required merely to give notice to the parties concerned to submit theircomments. Consequently, as observed by the interveners and by the AdvocateGeneral at point 91 of his Opinion, the imposition on the Commission of anobligation requiring it to conduct an exchange of views and arguments with thecomplainant in the context of the initial review provided for by Article 93(3) of theTreaty could lead to conflict between the procedural regime established by thatprovision and that laid down by Article 93(2).

60.

    Next, as regards the statement that the Commission is obliged to examine certainobjections of its own motion, it must be stated, contrary to what was held by theCourt of First Instance, that the Commission is under no obligation to examine ofits own motion objections which the complainant would certainly have raised hadit been given the opportunity of taking cognisance of the information obtained bythe Commission in the course of its investigation.

61.

    That criterion, which requires the Commission to place itself in the applicant'sshoes, is not an appropriate criterion for defining the scope of the Commission'sobligation of investigation.

62.

    However, this finding does not mean that the Commission is not obliged, wherenecessary, to extend its investigation of a complaint beyond a mere examination ofthe facts and points of law brought to its notice by the complainant. TheCommission is required, in the interests of sound administration of the fundamentalrules of the Treaty relating to State aid, to conduct a diligent and impartialexamination of the complaint, which may make it necessary for it to examinematters not expressly raised by the complainant.

63.

    As regards the Commission's obligation to state reasons, it is settled case-law thatthe statement of reasons required by Article 190 of the Treaty must be appropriateto the act at issue and must disclose in a clear and unequivocal fashion thereasoning followed by the institution which adopted the measure in question in sucha way as to enable the persons concerned to ascertain the reasons for the measureand to enable the competent Community court to exercise its power of review. The requirements to be satisfied by the statement of reasons depend on thecircumstances of each case, in particular the content of the measure in question,the nature of the reasons given and the interest which the addressees of themeasure, or other parties to whom it is of direct and individual concern, may havein obtaining explanations. It is not necessary for the reasoning to go into all therelevant facts and points of law, since the question whether the statement ofreasons meets the requirements of Article 190 of the Treaty must be assessed withregard not only to its wording but also to its context and to all the legal rulesgoverning the matter in question (see, in particular, Joined Cases 296/82 and 318/82Netherlands and Leeuwarder Papierwarenfabriek v Commission [1985] ECR 809,paragraph 19, Case C-350/88 Delacre and Others v Commission [1990] ECR I-395,paragraphs 15 and 16, and Case C-56/93 Belgium v Commission [1996] ECR I-723,paragraph 86).

64.

    As regards, more particularly, a Commission decision finding that no State aid asalleged by a complainant exists, the Commission must at least, contrary to thesubmission of the German Government, provide the complainant with an adequateexplanation of the reasons for which the facts and points of law put forward in thecomplaint have failed to demonstrate the existence of State aid. The Commissionis not required, however, to define its position on matters which are manifestlyirrelevant or insignificant or plainly of secondary importance.

65.

    It is in the light of those findings regarding the scope of the Commission'sobligations in investigating the case and in stating reasons for the contested decisionthat the Court must appraise the arguments of the Commission and of theinterveners to the effect that the Court of First Instance treated the purelyprocedural requirement to state reasons as a matter concerning the substantivelegality of the decision and that, on the basis of an alleged insufficiency of

reasoning, it was in fact criticising the Commission for having committed a manifesterror of assessment attributable to the inadequacy of the investigation carried outby that institution.

66.

    As pointed out in paragraph 19 of this judgment, the Court of First Instanceexamined the pleas alleging infringement of Article 190 of the Treaty and manifesterror of assessment together.

67.

    It must, however, be remembered that these are distinct pleas, each of which maybe raised in proceedings under Article 173 of the Treaty. The first, allegingabsence of reasons or inadequacy of the reasons stated, goes to an issue ofinfringement of essential procedural requirements within the meaning of that articleand, involving a matter of public policy, must be raised by the Communityjudicature of its own motion (see, in particular, Case C-166/95 P Commission vDaffix [1997] ECR I-983, paragraph 24). By contrast, the second, which goes to thesubstantive legality of the contested decision, is concerned with infringement of arule of law relating to the application of the Treaty within the meaning of Article173, and can be examined by the Community judicature only if it is raised by theapplicant.

68.

    It should also be noted that, as the Advocate General found at point 52 of hisOpinion, although the Court of First Instance examined those two pleas together,it ultimately based its annulment of the Commission's decision solely oninfringement of Article 190 of the Treaty. However, certain of the criticisms of thatdecision which were upheld in the contested judgment cannot be based on a breachof the obligation to provide a statement of reasons.

69.

    Thus, as regards the placing of premises at Sécuripost's disposal by the post office,the Court of First Instance held, in paragraph 65 of the contested judgment, thatthe Commission should have compared the rents actually paid by Sécuripost withthose payable by its competitors for comparable premises. With regard to themaintenance of Sécuripost's vehicles by the 'Service National des Ateliers etGarages des PTT‘ (national workshops and garages department of the post office,hereinafter 'SNAG‘), the Court of First Instance held, in paragraph 69 of itsjudgment, that the Commission should have compared the rates actually chargedby SNAG with those charged by private garages.

70.

    Similarly, in paragraph 72 of the contested judgment, the Court of First Instancefound that the fact that the loan of FF 15 000 000 constituted a commercialtransaction was not in itself sufficient to show that it did not amount to State aid,since such a transaction may be effected at a rate which represents a specialadvantage. The Commission should therefore have considered whether the ratecharged was in line with the market rate.

71.

    Furthermore, as regards the complainants' objection that the rates charged bySécuripost to the post office were appreciably higher than those normally chargedin the sector concerned, the Court of First Instance noted, in paragraphs 74 and75 of the contested judgment, that the Commission's comparison of the pricescharged for the provision of services to the post office and to Casino shops hadbeen based solely on information relating to 1993. That comparison had omittedto take into consideration the differences in the prices charged between 1987 and1992, despite a steady fall in the rates charged by Sécuripost to the post officebetween 1987 and 1993, in accordance, in particular, with the framework agreementbetween the post office and Sécuripost of 30 September 1987, thus furthermagnifying the differences cited by the complainants. It followed, according to theCourt of First Instance, that the Commission should have examined the ratescharged by Sécuripost to the post office and to other customers in the years priorto 1993.

72.

    It follows that, as regards the matters referred to in paragraphs 69 to 71 of thisjudgment, the Court of First Instance failed to draw the necessary distinctionbetween the requirement to state reasons and the substantive legality of thedecision. On the basis of an alleged insufficiency of reasoning, it criticised theCommission for a manifest error of assessment attributable to the inadequacy ofthe investigation carried out by that institution.

73.

    Be that as it may, the Court of First Instance did not, as regards the othercomplaints, err in law in finding that the contested decision was vitiated byinsufficient reasoning.

74.

    First, the Court of First Instance found, in paragraph 62 of the contested judgment,that the decision at issue was vitiated by insufficient reasoning concerning thecomplainants' objection that the Commission had failed to examine the specificadvantage, criticised in their complaint, arising from the fact that the officialsseconded to Sécuripost by the post office might at any time be reassigned to thedepartment originally employing them if staff reductions proved necessary in theundertaking to which they were seconded, without that undertaking having to payin such circumstances any compensation whatever for redundancy or dismissal. Inthe proceedings before the Court of First Instance, the Commission had merelycontended in that regard that non-payment of compensation for redundancy ordismissal was no more than a secondary aspect of an objection raised in the variouscomplaints, regarding the total or partial payment by the State of the remunerationof the staff of Sécuripost.

75.

    The Court of First Instance was correct in finding that the reasoning contained inthe contested decision was inadequate in that regard, since the Commission had notresponded to that objection. That objection, which had been expressly raised in thecomplaint, could not be regarded as a secondary aspect of the objection concerningthe total or partial payment by the State of the remuneration of the staff ofSécuripost. Even if the remuneration of all the staff seconded by the post office

had been paid by Sécuripost, the latter would still have enjoyed the potentialbenefit of not having to pay any compensation in the event of their redundancy ordismissal.

76.

    Next, in paragraph 63 of its judgment, the Court of First Instance found that thereasons given in the contested decision were inadequate with regard to thecomplainants' objection concerning the fact that Sécuripost made no contributionto unemployment insurance funds in respect of officials on secondment. Accordingto the contested judgment, the Commission answered that objection by stating that'on the other hand, no contributions need to be made to unemployment insurancefunds in respect of the employment of officials on secondment, since theiremployment is guaranteed by their status as officials‘.

77.

    On that point too, the Court of First Instance correctly held that the reasons givenin the contested decision were inadequate. As the Court of First Instanceobserved, the Commission expressly acknowledged in the contested decision thatno contributions to unemployment insurance funds had been paid, but itsexplanation as to why it concluded that this did not constitute State aid within themeaning of Article 92 of the Treaty is so deficient that the reasons given in thecontested decision must be regarded as inadequate.

78.

    Having regard to the foregoing, the pleas put forward by the Commission insupport of its appeal must be upheld in part. However, like the Court of FirstInstance, this Court has also found deficiencies in the reasons on which thecontested decision is based. Those deficiencies are in themselves sufficient tojustify annulment of the decision. Consequently, the appeal must be dismissed inits entirety.

Costs

79.

    In accordance with the first paragraph of Article 122 of the Rules of Procedure ofthe Court of Justice, where an appeal is unfounded, the Court is to make a decisionas to costs. Under Article 69(2) of the Rules of Procedure the unsuccessful partyis to be ordered to pay the costs if they have been applied for in the successfulparty's pleadings, and under Article 69(3), where each party succeeds on some orfails on other heads, or where the circumstances are exceptional, the Court mayorder that the costs be shared or that the parties bear their own costs.

80.

    In the present case, the Commission has been unsuccessful, but the complainants,who were the applicants in the proceedings at first instance, have not taken partin the appeal procedure and have not therefore applied for costs. In thosecircumstances, the Commission and the French Republic must be ordered, pursuantto Article 69(3) of the Rules of Procedure, to bear their own costs. The FederalRepublic of Germany, the Kingdom of Spain and the Kingdom of the Netherlands

must also be ordered to bear their own costs, in accordance with Article 69(4) ofthe Rules of Procedure.

On those grounds,

THE COURT

hereby:

1.    Dismisses the appeal;

2.    Orders the Commission of the European Communities, the FederalRepublic of Germany, the Kingdom of Spain, the French Republic and theKingdom of the Netherlands to bear their own costs.

Rodríguez IglesiasGulmann Ragnemalm Wathelet Mancini Moitinho de Almeida Kapteyn Murray Edward Puissochet Hirsch Jann Sevón

Delivered in open court in Luxembourg on 2 April 1998.

R. Grass

G.C. Rodríguez Iglesias

Registrar

President

1: Language of the case: French.