In Case C‑51/20

36In the first place, the Commission claims that the Hellenic Republic failed to take the necessary measures required in order to implement the judgment establishing the failure to fulfil obligations, since over five years after the adoption of Decision 2014/539 and over two years after the delivery of that judgment, the Greek authorities have failed to recover the State aid in question from Larco.

37According to the Commission, the Greek authorities did not adopt measures for the recovery of that aid until after 29January 2020, the date on which the present action was brought, contrary to the requirement for immediate and effective implementation of that decision. First of all, Law No4664/2020, which provides that Larco be put under special administration, was adopted only on 14February 2020. Next, Larco was put under special administration on 28February 2020. Lastly, on 13March 2020, the Greek authorities requested that Larco repay the amount corresponding to that aid within 30days.

38In so far as concerns Larco’s special administration, the Commission notes, first, that Article21(4) of Law No4664/2020 provides that that company may receive a State subsidy in order to be able to cover its expenditure associated with that administration. According to the Commission, the operating aid granted to Larco, provided for by that provision and intended to relieve that company of expenses which it would normally have had to bear in its day-to-day management or normal activities, constitutes a category of aid which is particularly harmful to competition. It is argued that, in the present case, the Greek authorities have already granted Larco operating aid as part of the special administration.

39Second, the Commission takes the view that the Hellenic Republic was required to initiate insolvency proceedings against Larco and to register in the schedule of liabilities those liabilities relating to the repayment of the aid concerned within the four-month period referred to in Article4 of Decision 2014/539. Such registration should have been followed either by the full recovery of the aid in question or by the liquidation of the beneficiary of that aid and the definitive cessation of its activities.

40The Commission claims that, in the present case, the Hellenic Republic has failed to register liabilities relating to the repayment of the aid concerned in the schedule of liabilities. Pursuant to Article21(9) of Law No4664/2020, such formal registration could be effected only after the transfer of Larco’s assets to the highest bidder, following the sale of those assets at auction.

41According to the Commission, even if the Hellenic Republic’s claim relating to the repayment of the aid in question had been formally registered in the schedule of liabilities after the transfer of Larco’s assets, as provided for by the special administration, full compliance with the judgment establishing the failure to fulfil obligations would be possible only if the proceeds from the liquidation were sufficient to recover the full amount of the aid in question. Failing that, only the liquidation of Larco and the definitive cessation of its activities would make it possible to ensure full compliance with that judgment.

42In the second place, as regards the Hellenic State’s obligation to inform the Commission, that institution claims that the authorities of that Member State failed to provide, within the prescribed periods, information allowing the accuracy of the calculation of the amount of aid to be recovered to be verified.

43Thus, those authorities failed to comply with the judgment establishing the failure to fulfil obligations.

44Furthermore, the Commission takes the view that the fact that Larco’s action for annulment of Decision 2014/539 is, following the judgment of 26March 2020, Larko v Commission (C‑244/18P, EU:C:2020:238), still pending before the General Court is irrelevant to the present case. It argues that the infringement proceedings under Article260(2) TFEU are independent of those brought under Article263 TFEU. The Commission states that, by that judgment, the Court of Justice set aside in part the judgment of 1February 2018, Larko v Commission (T‑423/14, EU:T:2018:57), but did not annul Decision 2014/539, which remains fully enforceable. The Hellenic Republic is therefore required to implement that decision in its entirety.

45In its defence, the Hellenic Republic contends, in the first place, that the Greek authorities have taken a series of measures which constitute substantial progress in complying with the judgment establishing the failure to fulfil obligations. Thus, on account of Larco’s financial difficulties, on 14February 2020 the Greek authorities made provision for Larco to be put under special administration, which, they claim, applied from 28February 2020 and was to end after a period of 12months which began to run from the date on which it was applied or after a period of nine months which began to run from the date of delivery of the arbitration award relating the dispute concerning the system of ownership of the Larymna smelting plant.

46First, the Hellenic Republic notes that, compared to the ordinary bankruptcy procedure and the special procedure established by Law No4307/2014, special administration is a specific insolvency procedure, in the context of which the special administrator proceeds expeditiously with the sale of the assets of the undertaking concerned and carries out a public tendering procedure in order to avoid any depreciation of those assets.

47Admittedly, putting Larco under special administration did not lead to the immediate cessation of its activities. Keeping the Larymna smelting plant running was, however, deemed necessary in order, first, to maximise the price of Larco’s assets and, second, to ensure the continued production of nickel in Greece, which is of particular importance for both the Greek and European economies.

48It is argued, furthermore, that the Greek Ministry of the Environment and Energy has the power under national law to grant State subsidies intended to cover the costs necessary for the implementation of the special administration as well as operating costs for the purposes of keeping the undertaking running until the conclusion of that special administration. However, any amounts paid on that basis should be deducted from the sale price of the assets and be returned to the State, without account being taken of the other liabilities registered in the schedule of liabilities.

49Second, the Hellenic Republic observes that, within five days following the end of the tendering procedure, the special administrator must invite creditors to register their claims definitively and then draw up a definitive schedule of ranking liabilities. As regards, more specifically, the date on which claims are registered in the schedule of liabilities, the Hellenic Republic submits that, unlike the ordinary insolvency procedure– under which registration in the schedule of liabilities takes place prior to the liquidation of the undertaking– under the special administration procedure, that registration is effected once the assets of the company concerned have been sold. In derogation from the applicable general provisions, debts owed to the State which relate to the recovery of unlawful and incompatible aid take precedence over any general or special priority of other creditors.

50Third, the Hellenic Republic maintains that the definitive cessation of Larco’s activities will occur once that company’s assets are sold, thus ensuring the absence of economic continuity and distortion of competition on the market concerned. Thus, putting Larco under special administration is an irreversible procedure which will lead to the liquidation of that company and to the definitive cessation of its activities. In any event, the Hellenic Republic claims that, if the public tendering procedure were to fail, Larco would be put in bankruptcy and its assets liquidated under the ordinary insolvency procedure. Such a failure would have to be found if, during the special administration, 75% of that undertaking’s assets were not sold.

51Moreover, the Hellenic Republic does not dispute that Decision 2014/539 remains fully enforceable after delivery of the judgment of 26March 2020, Larko v Commission (C‑244/18P, EU:C:2020:238). However, according to that Member State, in its Notice on the recovery of unlawful and incompatible State aid, the Commission takes the view that, where an action against a recovery decision is pending, provisional implementation of that decision may be achieved, for instance, by way of a payment by the beneficiary of the full recovery amount into an escrow account.

52In the second place, the Hellenic Republic claims that, by its letter of 13March 2020, it informed the Commission of all the measures taken with a view to recovering the aid in question. On 14May 2020, it ordered the recovery of the total amount of that aid.

Findings of the Court

53As a preliminary point, it should be noted that the action brought by Larco for annulment of Decision 2014/539, which gave rise to the judgment of 26March 2020, Larko v Commission (C‑244/18P, EU:C:2020:238), has no bearing on the enforceability of that decision and, consequently, on the present dispute. According to the case-law of the Court of Justice, as is clear from Article278 TFEU, in the absence of a decision of the General Court to the contrary, an action for annulment does not have suspensory effect. Thus, in principle, the bringing of an action for annulment does not alter the enforceability of the decision the annulment of which is sought (see, to that effect, judgment of 9July 2015, Commission v France, C‑63/14, EU:C:2015:458, paragraph47).

54As to the Hellenic Republic’s argument that, in its Notice on the recovery of unlawful and incompatible State aid, the Commission states that, where an action against a recovery decision is pending, provisional implementation of that decision may be achieved, for instance, by way of a payment by the beneficiary of the full recovery amount into an escrow account, it is sufficient to note that, in the present case, that Member State has failed to provide any evidence demonstrating such a payment.

55Principally, it must be recalled, in the first place, that it is clear from the case-law of the Court of Justice that the Member State to which a decision requiring recovery of unlawful aid declared incompatible with the internal market is addressed is obliged, under the fourth paragraph of Article288 TFEU, to take all measures necessary to ensure implementation of that decision. It must succeed in actually recovering the sums owed in order to eliminate the distortion of competition caused by the anticompetitive advantage procured by that aid (judgment of 14November 2018, Commission v Greece, C‑93/17, EU:C:2018:903, paragraph68 and the case-law cited).

56The recovery of unlawful aid declared incompatible with the internal market must be effected without delay and in accordance with the procedures under the national law of the Member State concerned, provided that they allow the immediate and effective execution of the Commission’s decision. To this effect, the Member States concerned are required to take all necessary steps which are available in their respective legal systems, including provisional measures, without prejudice to EU law (judgment of 14November 2018, Commission v Greece, C‑93/17, EU:C:2018:903, paragraph69 and the case-law cited).

57In cases in which the unlawful State aid paid and declared incompatible with the internal market must be recovered from recipient undertakings which are in financial difficulty or are insolvent, it should be recalled that such difficulties do not affect the obligation to recover. The Member State is therefore required, as the case may be, to bring about the liquidation of that company, to have its claim registered as one of that company’s liabilities or to take any other measure enabling the aid to be recovered (judgment of 17January 2018, Commission v Greece, C‑363/16, EU:C:2018:12, paragraph36).

58In particular, according to settled case-law, restoration of the previous situation and elimination of the distortion of competition resulting from that aid may, in principle, be achieved through registration of the debt relating to the repayment of the aid in question in the schedule of liabilities (judgment of 17January 2018, Commission v Greece, C‑363/16, EU:C:2018:12, paragraph37 and the case-law cited).

59However, it must be noted that such registration can satisfy the recovery obligation only if, where the State authorities are unable to recover the full amount of aid, the insolvency proceedings result in the liquidation of the undertaking, that is to say, in the definitive cessation of its activities, which the State authorities are able to bring about in their capacity as shareholders or creditors (judgment of 17January 2018, Commission v Greece, C‑363/16, EU:C:2018:12, paragraph38).

60It follows that the definitive cessation of the activities of the undertaking receiving aid is necessary only where the recovery of the entire amount of the aid remains impossible throughout the insolvency proceedings (judgment of 17January 2018, Commission v Greece, C‑363/16, EU:C:2018:12, paragraph39).

61It should also be recalled that, concerning infringement proceedings under Article260(2) TFEU, the reference date which must be used for assessing whether there has been a failure to fulfil obligations is that of the expiry of the period prescribed in the letter of formal notice issued under that provision (judgment of 14November 2018, Commission v Greece, C‑93/17, EU:C:2018:903, paragraph73 and the case-law cited).

62In the present case, as has been recalled in paragraph20 of the present judgment, since the Commission sent the Hellenic Republic a supplementary letter of formal notice on 25January 2019, in accordance with the procedure laid down in Article260(2) TFEU, the reference date mentioned in the preceding paragraph of the present judgment is the date of expiry of the period prescribed in that letter, namely 25March 2019.

63It is clear that, at that date, the Greek authorities had not complied with the obligation to recover the aid in question.

64As is apparent from paragraphs23 to 25, 45 and 52 of the present judgment, the Greek authorities did not adopt measures for the recovery of the aid in question until after 29January 2020, the date on which the present action was brought. First, Law No4664/2020 establishing the special administration scheme was in fact adopted on 14February 2020, that is to say almost one year after the expiry of the period prescribed in the letter of formal notice and almost six years after the date of expiry of the initial period for implementation of Decision 2014/539. Second, it is common ground that the Hellenic Republic put Larco under special administration on 28February 2020. Third, the request that the amount corresponding to the aid in question be repaid within 30days was sent to Larco on 13March 2020. Fourth and lastly, on 14May 2020, the Greek authorities sent the Greek tax authorities a letter in which they requested that the aid in question be recovered in full from Larco.

65In those circumstances, the Hellenic Republic cannot validly claim that, on the date of expiry of the period prescribed in the letter of formal notice, it had taken all the measures necessary to implement the procedure for recovery of the State aid at issue.

66In the second place, as regards the failure to inform the Commission, it should be observed that, on the expiry of the period prescribed in the letter of 25January 2019, the Hellenic Republic had not submitted to the Commission the information set out in Article5 of Decision 2014/539.

67It must therefore be held that, by failing to take all the measures necessary to comply with the judgment establishing the failure to fulfil obligations, the Hellenic Republic has failed to fulfil its obligations under Article260(1) TFEU.