Case C‑76/15

Paul Vervloet and Others

v

Ministerraad

(Request for a preliminary ruling from the Grondwettelijk Hof)

(Reference for a preliminary ruling — State aid — Aid implemented by the Kingdom of Belgium in favour of ARCO Group financial cooperatives — Deposit guarantee schemes — Directive 94/19/EC — Scope — Guarantee scheme protecting the shares of individual members, being natural persons, of cooperatives operating in the financial sector — Not included — Articles 107 TFEU and 108 TFEU — Commission decision declaring the aid incompatible with the internal market)

Summary — Judgment of the Court (Second Chamber), 21 December 2016

1. Questions referred for a preliminary ruling—Admissibility—Need for a preliminary ruling and relevance of the questions referred—Assessment by the national court—Presumption of relevance of the questions referred

   (Art. 267 TFEU)

2. Freedom of establishment—Freedom to provide services—Credit institutions—Deposit guarantee schemes—Directive 94/19—Scope—Deposit—Concept—Shares of recognised cooperatives operating in the financial sector—Not included

   (European Parliament and Council Directive 94/19, as amended by Directive 2005/1, Art. 1, point 1, first and second paras)

3. Freedom of establishment—Freedom to provide services—Credit institutions—Deposit guarantee schemes—Directive 94/19—Scope—Recognised cooperatives operating in the financial sector—Not included

   (European Parliament and Council Directive 94/19, as amended by Directive 2005/1, Art. 1, points 1, first and fourth paras)

4. Freedom of establishment—Freedom to provide services—Credit institutions—Deposit guarantee schemes—Directive 94/19—National legislation providing for a scheme to guarantee shares of recognised cooperatives operating in the financial sector—Lawfulness—Conditions

   (Arts 107 TFEU and 108 TFEU; European Parliament and Council Directive 94/19, as amended by Directive 2005/1, Arts 2 and 3)

5. State aid—Concept—Grant of an advantage to the beneficiaries—Scheme to guarantee shares of recognised cooperatives operating in the financial sector—Included

   (Art. 107 TFEU)

6. State aid—Concept—Selective nature of the measure—Scheme to guarantee shares of recognised cooperatives operating in the financial sector—Included

   (Art. 107(1) TFEU; European Parliament and Council Directive 94/19, as amended by Directive 2005/1, Recital 1)

7. State aid—Effect on trade between Member States—Adverse effect on competition—Scheme to guarantee shares of recognised cooperatives operating in the financial sector—Criteria for assessment

   (Art. 107(1) TFEU)

8. State aid—Commission decision finding aid incompatible with the internal market—Obligation to state reasons—Scope

   (Arts 107(1) TFEU and 296 TFEU)

9. Actions for annulment—Pleas in law—Lack of or inadequate statement of reasons—Separate ground from the one concerning substantive legality

   (Arts 263 TFEU and 296 TFEU)

10. State aid—Planned aid—Duty of prior notification and provisional suspension of the implementation of the aid—Scope

    (Arts 107(1) TFEU and 108(3) TFEU)

1.  See the text of the decision.

   (see paras 56, 57)

2.  As regards the material scope of application of Directive 94/19 on deposit-guarantee schemes, as amended by Directive 2005/1, it is apparent from the very title of that directive that it relates to ‘deposit’ guarantee schemes. Under the first subparagraph of Article 1(1) of that directive, ‘deposit’ means, for the purposes of that directive, first, any credit balance which results from funds left in an account or from temporary situations deriving from normal banking transactions and which a credit institution must repay under the legal and contractual conditions applicable, and, secondly, any debt evidenced by a certificate issued by that credit institution. The shares of recognised cooperatives operating in the financial sector do not fall within that definition. It appears that such shares are essentially participations in the own capital of the undertaking concerned, whereas the deposits referred to in Directive 94/19 are distinguished by the fact that they form part of the borrowed capital of a credit institution.

   Moreover, although the deposits must, in accordance with the definition in the first subparagraph of Article 1 of Directive 94/19, be repaid to their depositors under the legal and contractual conditions applicable, the amount received, in the case of withdrawal, by the holder of shares in recognised cooperatives operating in the financial sector, reflects those undertakings’ performance. The acquisition of such shares is thus more comparable to the acquisition of shares in companies, with respect to which no guarantees are provided by Directive 94/19, than to a payment made into a bank account. Moreover, shares of recognised cooperatives operating in the financial sector cannot be equated with the shares of British or Irish building societies, which are regarded as deposits for the purposes of the second subparagraph of Article 1(1) of Directive 94/19. Nothing in the wording or in the origin of that subparagraph suggests that that provision is not intended to cover instruments other than those which are expressly referred to therein. In addition, that provision expressly excludes from that extension shares in those building societies which are of a capital nature.

   (see paras 65-69)

3.  As regards the personal scope of application of Directive 94/19 on deposit-guarantee schemes, as amended by Directive 2005/1, both types of deposit referred to in the first subparagraph of Article 1(1) of that directive have in common the fact that they were made with a credit institution. Article 1(4) of Directive 94/19 defines the concept of ‘credit institution’ as covering undertakings the business of which is to receive deposits or other repayable funds from the public and to grant credits for their own account. It follows that shares in those cooperatives do not come within the personal scope of application of Directive 94/19.

   (see paras 70-72)

4.  Articles 2 and 3 of Directive 94/19 on deposit-guarantee schemes, as amended by Directive 2005/1, must be interpreted as not requiring Member States to adopt a scheme to guarantee shares in recognised cooperatives operating in the financial sector, and as not precluding Member States from adopting such a scheme, in so far as that scheme does not undermine the practical effectiveness of the deposit-guarantee scheme that that directive requires Member States to establish, which is a matter to be determined by the referring court, and provided that it complies with the FEU Treaty, in particular with Articles 107 TFEU and 108 TFEU.

   (see para 87, operative part 1)

5.  As regards the classification as State aid, for the purposes of Article 107 TFEU, of a scheme to guarantee shares in recognised cooperatives operating in the financial sector, the condition relating to the advantage conferred by the intervention of the State is satisfied where a group of cooperatives benefits from that scheme, which they moreover, unlike the other recognised cooperatives operating in the financial sector, themselves applied to join and, subsequently, derived the benefit thereof. It was that guarantee scheme alone which protected that group from the imminent flight of private investors in that group and was thus able, at the same time, to participate in the recapitalisation of a bank of national significance of which it is the main shareholder. The fact that other interested parties, namely the individual shareholders of the cooperatives of that group and the bank at issue, were also able to benefit from certain advantages under that guarantee scheme does not mean that that group must not be regarded as the beneficiary thereof.

   (see paras 89, 91, 94, 95)

6.  Article 107(1) TFEU requires an assessment of whether, under a particular legal regime, a national measure is such as to favour ‘certain undertakings or the production of certain goods’ in comparison with others which, in the light of the objective pursued by that regime, are in a comparable factual and legal situation.

   As regards a deposit guarantee scheme which is extended by a Member State to shares in recognised cooperatives operating in the financial sector, the benefit of that guarantee scheme confers an economic advantage on those cooperatives in relation to other economic operators which offer for sale participations in their ownership in the form of shares without benefiting from such a guarantee scheme. The recognised cooperatives operating in the financial sector are, in the light of the objective pursued by the deposit-guarantee scheme and consisting, as is apparent from recital 1 of Directive 94/19 on deposit-guarantee schemes, as amended by Directive 2005/1, in protecting savers in the event of the unavailability of deposits made in credit institutions and in increasing the stability of the banking system, in a factual and legal situation comparable, despite certain specificities resulting from the legal form of those cooperatives, to that of other economic operators, whether or not they are cooperatives, which offer for sale participations in their ownership in the form of shares, by making available to the public a form of capital investment which is not covered by the deposit-guarantee regime.

   Consequently, the extension of the guarantee scheme to shares in cooperatives operating in the financial sector has the effect of conferring an economic advantage on those cooperatives in relation to other economic operators which are, in the light of the objective pursued by that scheme, in a factual and legal situation comparable to that of those cooperatives and, therefore, has a selective character.

   (see paras 98-101)

7.  As regards the classification as State aid of a scheme to guarantee shares in recognised cooperatives operating in the financial sector, the fact that the value of shares held by individual members of cooperatives operating in the financial sector is generally low is not capable of ruling out that the guarantee scheme at issue distorts competition and affects trade between Member States. The effects of such a scheme on trade between Member States must be assessed by reference to all of the shares of recognised cooperatives operating in the financial sector which it covers and not by reference to the protected capital of an individual private member of a cooperative. In any event, the relatively small amount of aid or the relatively small size of the undertaking which receives it does not as such exclude the possibility that trade between Member States might be affected.

   (see paras 106, 107)

8.  See the text of the decision.

   (see paras 110, 111, 113, 114)

9.  See the text of the decision.

   (see para. 116)

10.  The prohibition on putting into effect a proposed measure to grant or alter aid before the final decision of the Commission provided for in the last sentence of Article 108(3) TFEU is designed to ensure that aid cannot become operational before the Commission has had a reasonable period in which to study the proposed measures in detail and, if necessary, to initiate the procedure provided for in Article 108(2) TFEU.

    In that regard, as regards a measure consisting in the admission of recognised cooperatives operating in the financial sector to participate in a deposit-guarantee scheme, a notification to the Commission made at a late stage, namely on the date the application for capital protection by that guarantee scheme made by such cooperatives was accepted by the Member State concerned, cannot be regarded as being ‘in sufficient time’ within the meaning of Article 108(3) TFEU. The notification of that scheme took place, in any event, when that scheme was no longer in ‘draft form’ within the meaning of that provision. Consequently, the principle of preliminary review by the Commission was infringed. It follows that Article 108(3) TFEU must be interpreted as precluding such a guarantee scheme in so far as the latter was put into effect in infringement of the obligations arising from that provision.

    (see paras 120, 123, 124, 126, 128, operative part 3)