CJEU: The extension of the period of validity of existing State aid

27 Oct 2016 12:06 PM

In 1960, DEI, a public electricity company, entered into a contract with Alouminion, a Greek company specialised in the production of aluminium, under which it was granted a preferential tariff for the supply of electricity. The contract was due to end on 31 March 2006, unless it was extended in accordance with its provisions. By decision of 23 January 1992, the Commission held that the preferential tariff granted to Alouminion under that contract constituted a State aid scheme compatible with the internal market.

DEI terminated the 1960 contract as of 1 April 2006. Alouminion challenged that termination before the Greek courts. By order of 5 January 2007, the Monomeles Protodikeio Athinon (Single-member Court of First Instance, Athens, Greece), in interlocutory proceedings, suspended, as an interim measure, the effects of the termination. DEI brought an appeal before the Polymeles Protodikeio Athinon (Multi-member Court of First Instance, Athens) which, by order of 6 March 2008, terminated, from that date, the 1960 contract.

By decision of 13 July 2011, the Commission considered that Greece had unlawfully granted Alouminion State aid of an amount of €17.4 million since, in consequence of the first order of the Greek courts, Alouminion continued to benefit from the preferential tariff for the period from 5 January 2007 to 6 March 2008. The Commission held that that aid should be classified as new aid and that, since it had been granted without prior notification to the Commission, it was incompatible with the internal market. It therefore ordered Greece to recover the aid from Alouminion.

The General Court, in proceedings brought by Alouminion, by judgment of 8 October 2014, 1 annulled the Commission’s decision, holding that that aid must be classified as existing aid.

DEI, supported by the Commission, brought appeal proceedings before the Court of Justice arguing that the General Court had made errors in law. 

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