Commission Decision of 31 July 1991 concerning aid provided by the Derbyshire County Council to Toyota Motor Corporation, an undertaking producing motor vehicles (Only the English text is authentic)

• Articles: 5

Article 1

The aid in the form of a subsidy amounting to £ 4,2 million to Toyota Motor Corporation entailed in the sale to that company of the 580-acre site at Burnaston by the Derbyshire County Council in February 1990 is illegal as it was provided in violation of the provisions of Article 93 (3) of the EEC Treaty. Moreover it is incompatible with the common market within the meaning of Article 92 of the Treaty.

Article 2

The United Kingdom Government is hereby required to ensure that this aid is withdrawn by means of a refund of £ 4,2 million by Toyota to the Derbyshire County Council within two months from the notification of this Decision. This refund amount shall be increased by the interest advantage from which the company might unlawfully benefit in the event of the refund taking place later than the two months indicated above.

Article 3

The United Kingdom Government shall inform the Commission within two months from the notification of this Decision of the measures taken to comply herewith.

Article 4

This Decision is addressed to the United Kingdom. Done at Brussels, 31 July 1991. For the Commission

Leon BRITTAN

Vice-President

(1) OJ No C 325, 28. 12. 1990. (2) The District Valuer is a Government (Inland Revenue) employee with statutory functions to provide inter alia the valuations for various local authority purposes. (3) Bulletin EC 9-1984. (4) As noted above, the calculations underlying this 'break-even' approach are now unlikely to be realized and there will be considerable cost overruns by the DCC on the provision of related services. (5) OJ NO C 123, 18. 5. 1989, p. 3. (6) [1973] ECR, p. 611. (7) [1973] ECR, p. 813. (8) [1987] ECR, p. 901.

Article 92

(3) of the Treaty lists aid which may be compatible with the common market. Compatibility with the Treaty must be determined in the context of the Community as a whole and not of a single Member State. In order to safeguard the proper functioning of the common market and taking into account the principles of Article 3 (f), the exceptions from the principle of Article 92 (1) as set out in Article 92 (3) must be construed narrowly when an aid scheme or any individual aid award is scrutinized. In particular, they may be applied only when the Commission is satisfied that the free play of market forces alone, without the aid, would not induce the prospective aid recipient to adopt a course of action contributing to the attainment of one of the said objectives.

With regard to the exceptions provided for in Article 92 (3) (a) and (c) for aids that promote or facilitate the development of certain areas, in the present case, Burnaston, which is located in Derbyshire, is not situated in a region eligible for State aid pursuant to Article 92 (3) (a) or (c).

As to the exceptions provided for in Article 92 (3) (b), the facts of the case provide no grounds whatsoever for considering that the aid in question is intended to promote a project of common European interest or to remedy a serious disturbance in the United Kingdom economy. Furthermore, the United Kingdom Government has not presented any such arguments to justify the aid in question.

With regard to the exception provided for in paragraph 3 (c) of Article 92 of the EEC Treaty in favour of 'aid to facilitate the development of certain economic activities', the Commission may accept certain aid in the motor-vehicle industry as compatible with the common market if it fulfils one of the positive criteria for appreciation of aid cases - other than regional aid - cited in the guidelines to the Community framework on State aid to that sector. These concern aid with the following objectives: rescue and restructuring aid, innovation or fundamental rationalization, research and development, environmental protection, basic vocational training. None of these objectives are applicable to the aid and project in question, nor has the United Kingdom Government claimed otherwise.

VIII

In cases of aid incompatible with the common market, the Commission - marking use of a possibility given to it by Article 93 (2) of the Treaty and by the Court of Justice in its judgment of 12 July 1973 in Case 70/72 (5), confirmed in the judgment of 24 February 1987 in Case 310/85 (3) - can require Member States to recover from recipients the aid granted. To this end, it is necessary that the United Kingdom authorities recover within two months the incompatible aid awarded to Toyota by the Derbyshire County Council, such recovery to be realized according to the provisions of national law including those referring to the late repayment charges on obligations to the State in the event that repayment takes place later than decided by the Commission,

HAS ADOPTED THIS DECISION: