Deufil v Commission: ECJ 24 Feb 1987

ECJ 1. The aim of article 92 is to prevent trade between member states from being affected by benefits granted by the public authorities which, in various forms, distort or threaten to distort competition by favouring certain undertakings or the production of certain goods. That article does not therefore distinguish between the measures of state intervention concerned by reference to their causes or their aims but defines them in relation to their effects, with the result that the general objectives of national rules, such as those laying down measures of conjunctural policy within the meaning of article 103 of the treaty, are not in themselves sufficient to put those rules outside the scope of article 92.
2. In the application of article 92(3), the commission has a discretion the exercise of which involves economic and social assessments which must be made in a community context. The Commission in no way exceeded the limits of its discretion by considering that the granting of aid for an investment which increases production capacity in a sector in which there is already considerable over-production is contrary to the common interest and that aid of that sort is not of such a nature as to promote the economic development of the area at issue.
3. Where, contrary to the provisions of article 93(3) of the treaty, a member state grants the proposed aid before the end of the procedure initiated by the commission, the latter’s decision that the aid which has been granted is incompatible with the common market may include an order to the national authorities to recover the aid without the beneficiary thereof being able to rely on a breach of a legitimate expectation in regard to that decision, provided that there could be no doubt on the part of the said beneficiary as to the scope of the community rules.

C-310/85, [1987] EUECJ C-310/85
CitedDeufil v Commission ECJ 6-Feb-1986
ECJ State aid for the production of polyamide and polypropylene. Interim Measures . .

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Updated: 20 November 2021; Ref: scu.515464