Court of Justice of the European Communities (including Court of First Instance Decisions)

ORDER OF THE GENERAL COURT (Second Chamber)

24 November 2020 (*)

(State aid - Decision declaring that some of the measures implemented by the United Kingdom in favour of certain multinational groups constitute an aid scheme that is incompatible with the internal market - United Kingdom tax regime relating to group financing and concerning in particular controlled foreign companies - Action for annulment - Intervention - Interest in the result of the case - Beneficiaries of the aid scheme at issue - Leave to intervene granted)

In Case T-456/19,

ITV plc, established in London (United Kingdom), represented by J. Lesar, Solicitor, and K. Beal QC,

applicant,

supported by

United Kingdom of Great Britain and Northern Ireland, represented by S. Brandon, acting as Agent,

intervener,

v

European Commission, represented by L. Flynn, B. Stromsky and S. Noë, acting as Agents, and M. Clayton and M. Segura Catalán, lawyers,

defendant,

APPLICATION for annulment of Commission Decision C(2019) 2526 of 2 April 2019 on the State aid SA.44896 implemented by the United Kingdom concerning [Controlled Foreign Companies] Group Financing Exemption,

THE GENERAL COURT (Second Chamber),

composed of V. Tomljenović (Rapporteur), President, F. Schalin and I. Nõmm, Judges,

Registrar: E. Coulon,

makes the following

Order

Facts and procedure

1 By application lodged at the Court Registry on 4 July 2019, the applicant, ITV plc, brought the present action seeking annulment of Commission Decision C(2019) 2526 of 2 April 2019 on the State aid SA.44896 implemented by the United Kingdom concerning [Controlled Foreign Companies] Group Financing Exemption and published in the Official Journal of the European Union on 20 August 2019 (OJ 2019 L 216, p. 1, ‘the contested decision’).

2 By document lodged at the Court Registry on 15 October 2019, Compass Overseas Holdings Ltd, Compass Overseas Holdings No. 2 Ltd and Hospitality Holdings Ltd (together, ‘Compass Overseas’) applied for leave to intervene in the present case in support of the form of order sought by the applicant.

3 The application for leave to intervene was served on the main parties, in accordance with Article 144(1) of the Rules of Procedure of the General Court.

4 By separate document lodged at the Court Registry on 8 November 2019, the Commission raised objections to that application. By contrast, the applicant did not raise any objection to the application for leave to intervene.

5 By document lodged at the Court Registry on 4 November 2019, the United Kingdom of Great Britain and Northern Ireland applied for leave to intervene in the present case in support of the form of order sought by the applicant.

6 By document lodged at the Court Registry on 27 November 2019, the applicant requested, pursuant to Article 144(5) and (7) of the Rules of Procedure, that certain confidential information in the file not be communicated to Compass Overseas and has produced, for the purposes of that communication, a non-confidential version of the procedural documents in question.

7 By decision of 21 January 2020, the President of the Second Chamber of the General Court granted the United Kingdom leave to intervene.

8 Acting upon a proposal of the Judge-Rapporteur, on 4 May 2020 the General Court, in the context of a measure of organisation of procedure provided for in Article 89 of the Rules of Procedure, requested the Commission to produce a document. Since the Commission did not comply with that request, the General Court, by order of 24 July 2020, ordered the Commission to produce the document in question; the Commission complied with that order on 28 July 2020.

Law

9 In accordance with Article 144(5) and Article 19(2) of the Rules of Procedure, the President of the Second Chamber referred the decision on the application to intervene to the Chamber.

10 In support of its application, Compass Overseas submits that it is directly affected by the contested decision since that decision orders the United Kingdom to recover State aid that it allegedly granted to Compass Overseas. Thus, according to the applicant for leave to intervene, it has a clear, direct and existing interest in the result of the present case since the action seeks the annulment of that contested decision.

11 Furthermore, Compass Overseas submits that it has itself brought an action seeking the annulment of the contested decision; these proceedings have been stayed. It claims, thus, that the result of the present case is such as to directly change its legal position, since it may entail the annulment of the contested decision, which directly affects Compass Overseas. The annulment of the contested decision in the context of the present action would necessarily also entail the annulment of that decision vis-à-vis Compass Overseas.

12 In addition, Compass Overseas asserts that there is a similarity between the pleas in law that it relied on in the context of its action and those relied on by the applicant in the present case, which further demonstrates its direct and existing interest in being granted leave to intervene.

13 The Commission recalls that, pursuant to the second paragraph of Article 40 of the Statute of the Court of Justice of the European Union, a person may intervene if that person can establish an interest in the result of a case. The Commission states that the concept relating to the ‘result of a case’ means the operative part of the final judgment that the parties ask the Court to deliver and not the pleas in law raised in the application. Therefore, Compass Overseas’ interest in relation to the pleas in law raised in the present action is irrelevant.

14 However, the Commission contends that it is necessary to ascertain whether Compass Overseas is directly affected by the contested decision and whether its interest in the result of the case is established. In its view, Compass Overseas has merely stated that the annulment of the contested decision would entail the annulment of a decision that directly affects it, but has failed to put forward any arguments in the application to intervene to establish that claim. The contested decision does not state that Compass Overseas is a beneficiary of the State aid the recovery of which the Commission has ordered. According to the Commission, since Compass Overseas has failed to prove that it was a beneficiary of the measures that are regarded as falling within the State aid scheme at issue and therefore, that it is affected by the contested decision, the application to intervene must be rejected.

15 In addition, the Commission states that the fact that Compass Overseas has brought an action that also seeks the annulment of the contested decision cannot, in itself, confer on it an interest in the result of the case.

16 Pursuant to the second paragraph of Article 40 of the Statute of the Court of Justice of the European Union, any person who can establish an interest in the result of a case submitted to the Court, other than a case between Member States, between institutions of the European Union or between Member States and institutions, is entitled to intervene in that case.

17 It follows from settled case-law that the concept of ‘interest in the result of the case’, within the meaning of that article, must be defined in the light of the precise subject matter of the dispute and be understood as meaning a direct, existing interest in the ruling on the forms of order sought and not as an interest in relation to the pleas in law or arguments put forward. The expression ‘the result of the case’ refers to the final decision sought, as it would be set out in the operative part of the judgment to be delivered (see order of the President of the Court of Justice of 15 October 2019, Commission v Belgium and Magnetrol International, C-337/19 P, not published, EU:C:2019:915, paragraph 11 and the case-law cited).

18 In that regard, it is necessary, in particular, to establish that the applicant for leave to intervene is directly affected by the contested measure and that its interest in the result of the case is certain. In principle, an interest in the result of the case can be regarded as sufficiently direct only in so far as that result is such as to change the legal position of the applicant seeking leave to intervene (order of the President of the Court of Justice of 15 October 2019, Commission v Belgium and Magnetrol International, C-337/19 P, EU:C:2019:908, paragraph 12 and the case-law cited).

19 According to the case-law, beneficiaries of aid granted on the basis of a State aid scheme, who are applicants for leave to intervene in an action for the annulment of a Commission decision declaring that scheme incompatible with the internal market and ordering the recovery of the aid, may have their legal position changed when the annulment of the contested decision, delivered by judgment of the General Court, becomes final, and thus, takes effect ex tunc and erga omnes. Thus, it has been held that those beneficiaries have shown that they had an interest in the result of the case (see, to that effect, order of the President of the Court of Justice of 15 October 2019, Commission v Belgium and Magnetrol International, C-337/19 P, EU:C:2019:908, paragraphs 17 and 18).

20 It is also apparent from settled case-law that it is for the applicant seeking leave to intervene to adduce the necessary evidence to prove that it satisfies the conditions for intervention (see, to that effect, order of the President of the Court of Justice of 17 October 2011, Gesamtverband der deutschen Textil- und Modeindustrie and Others v Council and Others, C-3/11 P(I), EU:C:2011:665, paragraph 31, and order of 11 May 2015, Bayerische Motoren Werke v Commission, T-671/14, not published, EU:T:2015:322, paragraph 16).

21 Furthermore, according to settled case-law, it is in principle for the person alleging facts in support of a claim to adduce proof of such facts (order of the Vice-President of the Court of Justice of 21 June 2016, C-157/16 P(I), Bundesverband der Pharmazeutischen Industrie v Allergopharma, EU:C:2016:476, paragraph 19 and the case-law cited).

22 In the present case, it should be borne in mind that the form of order sought by the applicant is for the annulment of the contested decision.

23 By that decision, the Commission reached the conclusion that the group financing exemption scheme contained in the tax laws in the context of Chapter 9 of Part 9A of the Taxation (International and Other Provisions) Act 2010 constituted State aid within the meaning of Article 107(1) TFEU, in so far as that scheme applied to non-trading finance profits from loans to foreign group companies, which fall within Section 371EB (UK activities) of that Act. In addition, the decision states that, to the extent that the group financing exemption scheme constitutes aid, it forms an ‘aid scheme’ within the meaning of Article 1(d) of Regulation (EU) 2015/1589. Furthermore, the decision states that the aid granted under the aid scheme is incompatible with the internal market and was unlawfully put into effect by the United Kingdom in breach of Article 108(3) TFEU.

24 Pursuant to Articles 2 and 3 of the operative part of the contested decision, the United Kingdom must recover all aid that is incompatible with the internal market and granted under the aid scheme at issue from the beneficiaries of that aid within four months following the date of notification of the decision.

25 The Commission did not identify the aid beneficiaries. In that regard, in Article 4 of the operative part of the contested decision, it ordered the United Kingdom to submit, within two months following notification of that decision, a list of the beneficiaries that received aid under the aid scheme at issue.

26 Compass Overseas submits that it is directly affected by the contested decision, since that decision orders the United Kingdom to recover State aid allegedly granted to Compass Overseas.

27 In the present case, it must be noted that, pursuant to Article 4 of the operative part of the contested decision, the United Kingdom sent the Commission a list of the companies and groups that its tax authorities had contacted for the purpose of implementing the contested decision.

28 It is apparent from that list, which the Commission submitted to the General Court, that Compass Overseas is listed as one of the groups of companies that was contacted by the United Kingdom authorities for the purpose of the recovery ordered by the contested decision. Since the fact that the name of Compass Overseas is included in that list was regarded by the General Court as non-confidential information, that information was added to the file in the present case.

29 Thus, in the light of the file in the present case, it is undisputed that Compass Overseas was contacted by the United Kingdom authorities with a view to potential recovery from it of aid it had allegedly received under the group financing exemption scheme challenged by the contested decision. Currently, the situation of the applicant for leave to intervene in the present case must be regarded as analogous to one in which the Commission itself would have published a provisional list of the beneficiaries of an aid scheme in the decision finding the existence of that aid scheme and its potential incompatibility with the internal market.

30 In the present case, the ruling on the form of order sought in the present action, in so far as it concerns the annulment of the contested decision, is capable of having effects on the legal position of Compass Overseas in that the procedures initiated against Compass Overseas by the United Kingdom tax authorities, in view of the recovery of the alleged aid at issue that is the object of the contested decision, would become devoid of any basis if that decision must be annulled.

31 Furthermore, it must be recalled that the Court of Justice has previously granted the applications for leave to intervene of several parties whose status as beneficiaries of an aid scheme referred to in the decision that was the object of the action in question was undisputed; those parties had themselves brought an action seeking the annulment of that contested decision, although the proceedings relating to that action had been stayed pending the outcome of the dispute in the case in which leave to intervene had been sought. The Court granted leave to intervene in those cases, in essence, due to the fact that the ruling on the form of order seeking annulment of the contested decision in the case in which the leave to intervene had been sought was such as to produce direct effects on the form of order sought by the applicants for leave to intervene, seeking the annulment of the same decision, and whose proceedings had been stayed pending the judgment regarding leave to intervene as well as on those applicants’ legal position with regard to that decision. The Court emphasised that the annulment ex tunc and erga omnes of the decision in question would change the legal situation of the applicants for leave to intervene who are also applicants for annulment of that decision (see, to that effect, order of the President of the Court of Justice of 21 December 2016, Commission v Spain and Others, C-128/16 P, not published, EU:C:2016:1006, paragraphs 14 and 15, and order of the President of the Court of Justice of 15 October 2019, Commission v Belgium and Magnetrol International, C-337/19 P, not published, EU:C:2019:915, paragraphs 15 to 18).

32 In those circumstances, Compass Overseas’ application for leave to intervene must be granted.

33 At this stage and in the light of the application for confidential treatment referred to in paragraph 6 above, the communication to Compass Overseas of documents that have been served on or, as the case may be, that are to be served on the main parties must therefore be limited to non-confidential versions. A decision as to whether the application for confidential treatment is well founded shall, should the need arise, be taken at a later stage, in the light of any objections that may be submitted in that regard.

On those grounds,

THE GENERAL COURT (Second Chamber)

hereby orders:

1. Compass Overseas Holdings Ltd, Compass Overseas Holdings No. 2 Ltd and Hospitality Holdings Ltd are granted leave to intervene in Case T-456/19, in support of the form of order sought by ITV plc.

2. The Registrar shall send Compass Overseas Holdings Ltd, Compass Overseas Holdings No. 2 Ltd and Hospitality Holdings Ltd a non-confidential copy of all procedural documents served on the main parties.

3. A time limit shall be fixed for Compass Overseas Holdings Ltd, Compass Overseas Holdings No. 2 Ltd and Hospitality Holdings Ltd to submit any objections they may have regarding the application for confidential treatment. The decision on whether that application is well founded is reserved.

4. A time limit shall be fixed for Compass Overseas Holdings Ltd, Compass Overseas Holdings No. 2 Ltd and Hospitality Holdings Ltd to submit a statement in intervention, without prejudice to the possibility of supplementing it later, should the need arise, following a decision on whether the application for confidential treatment is well founded.

5. The costs are reserved.

Luxembourg, 24 November 2020.

* Language of the case: English.