Procedure - Recovery
3 important questions on Procedure - Recovery
Acc. To art. 17 Procedural Reg, when does a recovery take place?
In case of negative decision, in case of incompatibility of aid with common market and aid already granted,
COM obliges to request recovery. No discretion!
COM obliges to request recovery. No discretion!
ECJ case C-277/00, judgement of 29 April 2004, SMI. What were the facts of the case?
- Aid granted by the fiduciary body and the Land Brandenburg for the insolvent undertaking SMI and for the hive-off undertaking SiMI
- COM-decision: incompatible with the common market + recovery
- Beneficiaries (and hence obliged to pay recovery): SMI; SiMI; subsidiary of SMI and SiMI; MD&D (acquired shares of SiMI)
- 80% of the shares of MD&D sold to US-American undertaking
- Germany: action for annulment against COM-decision
ECJ case C-277/00, judgement of 29 April 2004, SMI. What was the decision of the ECJ?
- share deal ≠ asset deal
- Requirement of strict distinction between undertakings, their legal entities and their share-holders
- Ad) Share deal: change of shareholders (owners) recovery obligation continues to rest with the company that received the aid
- Ad) Asset deal: change of legal entity!
- COM: acquirer of assets obliged to repay
- ECJ: recovery also from third party, if transaction without market-driven price or transaction as a means of evading duty to recover (proof by COM!)
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