Case C-159/01

Kingdom of the Netherlands

v

Commission of the European Communities

(State aid – Partial exemption from mineral levies for crops grown under glass or on substrate)

Summary of the Judgment

1. State aid – Concept – Differentiation between undertakings in relation to charges – Excluded – Condition – Differentiation inherent in the system of levies in question – Burden of proof on the Member State concerned

(Art. 87(1) EC)

2. State aid – Concept – Exemption granted under a system involving the payment of levies but not intended to generate tax revenue – No bearing on classification as aid

(Art. 87(1) EC)

3. Acts of the institutions – Statement of reasons – Obligation – Scope

(Art. 253 EC)

1. Since the concept of State aid does not cover measures which differentiate between undertakings in relation to charges where that differentiation is the result of the nature and general scheme of the system of levies in question, it is for the Member State which has introduced such a differentiation to show that that is actually the case.

(see paras 42-43)

2. The fact that a State measure providing for the payment of levies by a category of undertakings is not intended to generate tax revenue does not suffice to exclude outright its attendant exemption in favour of certain undertakings from classification as aid within the meaning of Article 87 EC. Article 87(1) EC does not distinguish between measures of State intervention by reference to their causes or their aims but defines them in relation to their effects.

(see para. 51)

3. The obligation to state reasons constitutes an essential procedural requirement which must be distinguished from the question of the merits of those reasons, which concern the substantive legality of the contested measure. The statement of reasons required by Article 253 EC must be adapted to the nature of the measure in question and must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted the measure in such a way as to make the persons concerned aware of the reasons for the measure and the Court to exercise its supervisory jurisdiction.

(see para. 65)

JUDGMENT OF THE COURT (Fifth Chamber) 29 April 2004 (1)

(State aid – Partial exemption from mineral levies for crops grown under glass or on substrate)

In Case C-159/01,

applicant,

v

defendant,

APPLICATION for the partial annulment of Commission Decision 2001/371/EC of 21 December 2000 on the exemption from mineral levies under the manure law which the Netherlands intends to grant (OJ 2001 L 130, p. 42),

THE COURT (Fifth Chamber),,

composed of: P. Jann, acting for the President of the Fifth Chamber, A. Rosas and S. von Bahr (Rapporteur), Judges,

Advocate General: P. Léger,

after hearing oral argument from the parties at the hearing on 29 January 2003, at which the Kingdom of the Netherlands was represented by C. Wissels, acting as Agent, and the Commission was represented by M. van Vliet,

after hearing the Opinion of the Advocate General at the sitting on 12 June 2003,

gives the following

‘Save as otherwise provided in this Treaty, any aid granted by a Member State or through State resources in any form whatsoever which distorts or threatens to distort competition by favouring certain undertakings or the production of certain goods shall, insofar as it affects trade between Member States, be incompatible with the common market.’

‘…does not [normally] approve operating aid which relieves firms, including agricultural producers, of costs resulting from the pollution or nuisance they cause. The Commission will only make exceptions to this principle in well-justified circumstances.’

‘…

2. These measures will ensure that, for each farm or livestock unit, the amount of livestock manure applied to the land each year, including by the animals themselves, shall not exceed a specified amount per hectare.

The specified amount per hectare shall be the amount of manure containing 170 kg N. However:

…

…’

‘Article 1

The tax exemptions under the Minas system which the Netherlands intends to grant to small undertakings (hobby undertakings), horticultural undertakings and garden centres performing horticultural activities is incompatible with the common market. The aid scheme must therefore not be implemented.

Article 2

The Netherlands shall inform the Commission, within two months of notification of this Decision, of the measures taken to comply with it.

Article 3

This Decision is addressed to the Kingdom of the Netherlands.’

On those grounds,

THE COURT (Fifth Chamber)

hereby:

Jann

Rosas

von Bahr

Delivered in open court in Luxembourg on 29 April 2004.

R. Grass

V. Skouris

Registrar

President