(Reference for a preliminary ruling– Structural Funds– European Regional Development Fund (ERDF)– Regulation (EU) No1303/2013– Co-financing programme– State aid– Regulation (EU) No651/2014

29In the context of an open procedure for the selection of projects to be granted funding under the ‘Growth and Employment’ programme co-financed by the ERDF, Zinātnes parks, a limited liability company governed by Latvian law, submitted a project application to the competent national agency on 30April 2019, the deadline for submission of project applications. Alongside its application, the applicant submitted a resolution passed by a general meeting of its members on 29April 2019 to alter its Articles of Association and to increase its share capital by means of a contribution of new shares, plus share premium, from a specified member, to be paid within a specified period.

30During the evaluation period, the applicant informed the competent national agency that the increase in share capital had been entered in the Commercial Register on 24July 2019, and, subsequently, by way of supplementary material the applicant provided an interim activity report approved by a sworn auditor.

31By its rejection decision, the Ministry of Finance rejected Zinātnes parks’ project application on the ground that that company had to be regarded, on the date of submission of its application, as an ‘undertaking in difficulty’ within the meaning of Article2(18)(a) of Regulation No651/2014.

32Hearing an action for annulment of that decision, the Administratīvā rajona tiesa (District Administrative Court, Latvia), the referring court, states that it is common ground between the parties that, if the information contained in Zinātnes parks’ most recent financial report, corresponding to 2018, were to be taken into account, Zinātnes parks would be classed as an ‘undertaking in difficulty’ within the meaning of Article2(18)(a) of that regulation. Nor is there any dispute as to the fact that, after the increase in the share capital and the entry of the respective alterations in the Commercial Register, that company no longer fulfilled the criterion set out in Article2(18)(a) of Regulation No651/2014 for classification as an ‘undertaking in difficulty’. By contrast, there are differences of opinion between the parties as to the extent to which the entry of the abovementioned increase in share capital in the Commercial Register and the evidence offered by Zinātnes parks during the procedure for examining project applications should have been taken into account by the competent national agency.

33In that context, the referring court has doubts, first of all, as to whether, in adopting the rejection decision, the Ministry of Finance correctly interpreted the concept of ‘subscribed share capital’ referred to in Article2(18)(a) of Regulation No651/2014 in the light of the concept of ‘share capital’ referred to in the Latvian national legislation as meaning only the share capital which has been disclosed, in accordance with the procedures specified in the national legislation.

34Under the Latvian legal system, according to Article202(3) of the Commercial Code, share capital is deemed to be increased on the day on which the new share capital is entered in the Commercial Register and it would be only from that date that such an increase would be enforceable against third parties. However, the referring court notes that Article2(18)(a) of Regulation No651/2014 does not contain any express reference to the law of the Member States for the purpose of defining the concept of ‘share capital’. In addition, Directive 2017/1132, in particular Articles14 and 16 thereof, does not make the validity of decisions increasing the share capital subject to a precondition; nor does it expressly leave it to the Member States to govern the issue.

35The referring court also asks whether the requirements laid down in connection with the selection procedure concerning the documents to be submitted and, in particular, the date on which they must be submitted, are relevant to the assessment of the financial situation of the person submitting the project application and whether, where appropriate, any shortcomings in a project application in terms of evidence of the project applicant’s financial situation may be corrected during the selection procedure. The referring court notes in particular that, in accordance with Article125(3)(a)(ii) of Regulation No1303/2013, selection procedures and criteria must be transparent and non-discriminatory.

36The referring court considers that, prima facie, those principles are the source of the principle, enshrined in Article30 of the Law on the Management of the Funds and developed in the regulations on the selection of project applications, according to which project applications cannot be clarified or supplemented after they have been submitted. Consequently, the competent national agency must comply with the criteria which it has itself established, so that it is required to exclude from the selection of projects applicants who have not attached a document or communicated information the production of which was required by the provisions governing that selection. That being said, the referring court notes that, although the Court has already held, in the context of public procurement, that there is also an obligation to comply with similar principles in the selection of tenders, such a consideration does not follow expressly from the case-law of the Court concerning State aid.

37In those circumstances the Administratīvā rajona tiesa (District Administrative Court) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:

‘(1)Must the concept of “subscribed share capital” in Article2(18)(a) of [Regulation No651/2014], in conjunction with other EU legal provisions relating to company law, be interpreted as meaning that, for the purposes of determining subscribed share capital, only particulars that have been published in the manner laid down by the national laws of each Member State may be taken into account, bearing in mind that the particulars in question are thus deemed to become effective only from that moment?

(2)When assessing the concept of “undertaking in difficulty” in Article2(18) of [Regulation No651/2014], is it necessary to attach significance to the requirements, laid down as part of the procedure for selecting projects for European funds, concerning which documents are to be submitted as evidence of the financial situation of the undertaking in question?

(3)If the reply to the second question referred is in the affirmative, is a provision of domestic law on the selection of projects, which establishes that no further clarification of projects may be made once they have been submitted, compatible with the principles of non-discrimination and transparency established in Article125(3)(a)(ii) of [Regulation No1303/2013]?’