C-330/01

OPINION OF M R ALBER — CASE C-330/01 P

OPINION OF ADVOCATE GENERAL ALBER delivered on 3 April 2003 1

I — Introduction 'Reduction, suspension and cancellation of assistance

1. The appeal concerns the question of the (1) If an operation or measure appears to extent to which the Commission is justify neither part nor the whole of the required, before adopting a decision to assistance allocated, the Commission shall reduce, suspend or cancel financial assist- conduct a suitable examination of the case ance granted under the Structural Funds, to in the framework of the partnership, in obtain the observations of the Member particular requesting that the Member State State concerned. or authorities designated by it to implement the operation submit their comments within a specified period of time.

(2) Following this examination, the Com- mission may reduce or suspend assistance II — Legal background and facts in respect of the operation or a measure concerned if the examination reveals an irregularity or a significant change affecting the nature or conditions for the implemen- tation of the operation or measure for which the Commission's approval has not been sought. 2. Article 24, as per Regulation (EEC) No 2082/93, 2 provides as follows:

1 — Original language: German. 2 — Council Regulation (EEC) N o 2082/93 of 20 July 1993 amending Regulation (EEC) N o 4253/88 laying down (3) Any sum received unduly and to be provisions for implementing Regulation (EEC) N o 2052/88 as regards coordination of the activities of the different recovered shall be repaid to the Commis- Structural Funds between themselves and with the oper- ations of the European Investment Bank and the other sion. Interest on account of late payment existing financial instruments (OJ 1993 L 193, p. 20). shall be charged on sums not repaid in

8. In its judgment of 14 June 2002 the 5. On 3 April 1998 the Commission sent a Court of First Instance dismissed the action letter to Hortiplant drawing attention to facts that might warrant a demand for repayment of the financial assistance. It 4 — Council Regulation (EEC) N o 4253/88 of 19 December 1988, laying down provisions for implementing Regulation (EEC) N o 2052/88 as regards coordination of the activities of the different Structural Funds between themselves and with the operations of the European Investment Bank and 3 — Judgment of the Court of First Instance in Case T-143/99 the other existing financial instruments (OJ 1988 L 374, Hortiplant S.A.T. v Commission [2001] ECR II-1665. p. 1).

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for annulment of the demand for repay- IV — The appeal and the Commission's ment. In paragraphs 103 and 104 of the position judgment, the Court made the following points concerning Article 24 of Regulation N o 4253/88:

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HORTIPLANT v COMMISSION

11. Hortiplant refers to Article 4(1) of 13. The Commission, on the other hand, Regulation N o 2052/88, 5which states that contends that the Court of First Instance Community operations in the field of interpreted Article 24 correctly. Under that structural development are to be such as provision it suffices for the Member State 'to complement or contribute to cor- to be given an opportunity to submit its responding national operations'. They are comments on the facts established within to be established through close consul- an appropriate period of time. There is tations between the Commission, the however no requirement for the Member Member State concerned and the compet- State actually to submit observations. The ent authorities designated by the latter. The Commission may reduce, suspend or cancel consultations are regarded as 'the partner- financial assistance w i t h o u t having ship' which cover the preparation, financ- received such observations. The Commis- ing, monitoring and assessment of oper- sion bases its opinion on the wording of ations. This conception is inconsistent with Article 24, according to which the Member the view that the Commission may in State concerned is 'requested' to submit its certain circumstances dispense with the comments and to do so within a period of observations of the State concerned. time specified by the Commission. If the Member State submits comments, this is to be taken into account in the subsequent decision-making process. If however it fails to submit comments within the specified period, the Commission is then free to pursue the procedure and adopt a decision.

annulled the Commission's decisions in least not expressly, about what happens if Oliveira 7 and Foyer culturel du Sart-Til- the Member State does not submit com- man 8 because the Member States con- ments within the specified period of time. cerned had not been given an opportunity to submit comments on the facts estab- lished.

19. Paragraphs 2 and 3 of Article 24 do not address this question either. They simply empower the Commission to reduce or 16. In the present case, Spain was offered suspend financial assistance if the examin- an opportunity to submit comments when ation confirms the evidence of irregular- it was sent the letter of 3 April 1998. ities. The provisions state further that any Furthermore, a Spanish official was present sums received are to be repaid. It follows at the 1997 on-the-spot check in the course that the wording of Article 24 cannot of which the irregularities were ascertained. support the appellant's contention. The wording is more consistent with the Com- mission's view that it is sufficient to give the Member State concerned an opportun- ity to comment on the outcome of the 17. Finally, the Commission points out that investigation, but that possession of such in the present case the financial assistance comments is in no way a mandatory was approved and paid out directly by the precondition. Commission without any intervention by national authorities. It was understandable in these circumstances that the Member State concerned should have had little interest in submitting comments. 20. Hortiplant relies further on the fact that financial assistance from structural funds is provided in the form of a 'partner- ship' between the Commission and the national authorities. On this point, it refers in particular to Article 4 of Regulation N o 2052/88. V — Appraisal

22. The 'partnership', invoked by the appellant, between the Commission and 23. Furthermore, even if the Member State the authorities of the Member States does concerned is of a different view, that does however seem to be relevant in another not stop the Commission from proceeding respect to the interpretation of Article 24. to reduce, suspend or cancel the financial The 20th and 25th recitals and Article 4 of assistance. The Commission is required to Regulation N o 2052/88 specify that Com- examine any comments submitted by the munity operations in the field of structural Member State concerned. But that does not development should simply complement mean that it must arrive at the same corresponding national operations. Close conclusion. There is thus still less reason consultations between the Commission and for the Commission to be bound by the the Member State concerned are called for silence of a Member State in such a way and all parties are required as partners, that no decision may be adopted by it until each within the framework of its responsi- the Member State has stated its position. bilities and powers, to pursue a common goal. It follows from these provisions that the two sovereign authorities involved in the financial assistance, namely the Com- mission and the Member States, must contribute to its success. The Member States, when called upon by the Commis- 24. It is even more important that a poss- sion to comment, are consequently required ible failure by the Member State concerned to respond if they have observations to to submit comments should not prevent a make. It is on account of this obligation on demand for repayment from being made the Member States' authorities to cooper- where, as in the present case, the monies ate, laid down in Regulation N o 2052/88, are paid to the beneficiary by the Commis- that a failure on the part of the Member sion direct, rather than by the Member States to respond to a request to submit State. Usually, the assistance from the comments cannot have the effect that the structural funds and from the EAGGF Commission is prevented from taking the takes the form, in the first instance, of a procedure further. The Member State's p a y m e n t by the C o m m i s s i o n to the silence would otherwise be able to be used Member State concerned, the latter then as a veto. Support for such a power of veto passing the monies on to the final bene- is however to be found neither in the ficiary. This is clear from Article 21 of wording of Article 24 nor in the spirit of Regulation N o 4253/88, as amended by the participatory procedure, less still in the Regulation N o 2082/93. Such an approach Member State's shared responsibility for is in keeping with the principle of sub- successful implementation of the financial sidiarity, according to which implemen-

tation of the forms of action proper to the understanding. Although the case-law does concepts governing Community assistance say that the Member State concerned must falls mainly within the area of competence be given an opportunity to submit com- of the Member States, as can be seen from ments — as regards the principle and the the sixth recital in the preamble to Regu- amount — on the proposed demand for lation N o 2 0 8 2 / 9 3 . According to repayment, 10 there is no need, firstly, for a Article 14(1) of Regulation N o 4253/88, formal hearing procedure; any form of as amended by Regulation N o 2082/93, contact, for example an exchange of letters, applications for assistance are however to is sufficient for this purpose. 11 To this be submitted directly to the Commission, extent Hortiplant's objection that the invi- rather than via the Member States, in the tation to the Spanish Government to sub- case of the technical assistance measures mit comments took the form of a courtesy referred to in Article 5(2)(e) of Regulation letter only does not seem pertinent. N o 2052/88 undertaken at the initiative of the Commission. In such cases the entire process of financial assistance takes place directly between the Commission and the final beneficiary. In such cases the involve- ment of the Member State in which the financial assistance is granted is less exten- sive. It may therefore see less cause to comment on the facts ascertained by the Commission. It would however run counter to the entire course of such financial assist- ance, which has been granted by the Commission to the final beneficiary direct, for the submission of comments by the Member State concerned to become a precondition for the Commission to be able to demand repayment on the basis of 26. Secondly, it is clear from this case-law Article 24 of Regulation N o 4253/88, as that the Court does not, even in cases amended by Regulation N o 2082/93 in where the financial assistance is provided such cases. via the authorities of the Member State, require the M e m b e r State concerned actually to submit comments. It suffices for it to be given an opportunity to do so. 1 2 Similarly, in its judgment in Socurte, cited 25. Even the case-law cited by Hortiplant by Hortiplant in the oral procedure, the regarding in particular — at least indi- Court required only that the Member State rectly — Article 6 of the Social Fund be given an opportunity to comment before R e g u l a t i o n 9 ultimately confirms this

the assistance was reduced. 1 3 Furthermore, infringement of rules of law, to the exclu- in the various cases cited by Hortiplant, the sion of any appraisal of the facts. An appeal Member State's position as a link in the is therefore admissible only in so far as it is chain between the Commission and the claimed that the decision of the Court of final beneficiary was precisely the reason First Instance is incompatible with the rules why the opportunity of stating a position of law the application of which it was was viewed as an essential procedural under a duty to ensure. 1 5 requirement. 1 4 In the present case, how- ever, it is this position as intermediary that does not apply, which again supports the view that the submission of comments by Spain should not be regarded as an essential 29. In so far, however, as the Court of First precondition for adoption of the contested Instance, in ruling that transmission of the decision. copy of the letter of 3 April 1998 addressed to Hortiplant constituted a request to submit comments within the meaning of Article 24 of Regulation N o 4253/88 not only assessed the facts but also assigned to

28. According to Article 225(1) EC an 1998 setting out the Commission's claims appeal is confined to points of law. That against Hortiplant. In the accompanying limit is laid down in more detail in the first letter Spain was, moreover, set a time-limit paragraph of Article 51 of the EC Statute of for submitting observations. Consequently, the Court of Justice. As the Court has held the finding of the Court of First Instance on several occasions, an appeal may be that the steps taken constituted proper based only on grounds relating to the involvement of the Member State con- cerned within the meaning of Article 24 of Regulation N o 4253/88 is not obviously 13 — Judgment in Socurte and Others v Commission, cited in defective. footnote 6, paragraphs 71 and 76. Paragraph 66 of that judgment, introducing examination of this question, is expressed confusingly in so far as it states that the submission by the Member State of its comments must be established with a sufficient degree of certainty and 15 — Order in Case C-89/95 P D. v Commission [1996] ECR

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31. Nor does the fact that Hortiplant's VI — Costs comments in response to the Commission's claims were not passed on to the Spanish authorities constitute a misapplication of Article 24. Neither the wording of that provision nor the spirit and purpose of the participatory procedure require the com- ments submitted by the beneficiary to be passed on in this way. In this respect also, t h e r e f o r e , Article 24 of R e g u l a t i o n N o 4253/88 cannot be said to have been misapplied or misinterpreted. 33. In accordance with Article 122 in conjunction with Articles 118 and 69(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful 32. It is to be concluded from the foregoing party's pleadings. The Commission has that the judgment of the Court of First asked for Hortiplant to be ordered to pay Instance in Case T-143/99 does not contain the costs. As the appeal is to be dismissed, any error of law. The appeal should there- Hortiplant should be ordered to pay the fore be dismissed. costs.

VII — Conclusion

3 4 . In the light of the foregoing I p r o p o s e t h a t the C o u r t :

(1) dismiss the a p p e a l ;