Opinion of mr advocate-general reischl

Mr President,

Members of the Court,

Today, I have the honour for the first time — as required by Article 166 of the EEC Treaty — with complete impartiality and independence, to make, in open court, reasoned submissions…

They concern four references (119/73, 120/73, 121/73 and 141/73) from the Frankfurt Verwaltungsgericht, made by orders dated 19 March and 28 May 1973 and joined, for the purpose of having common oral proceedings, by an order of this Court of 18 September 1973.

To enable the proceedings to be more easily followed, I should like, by way of introduction to say this,

In the course of 1968 the Government of the Federal Republic of Germany drew up, as part of a programme for regional development, a draft law providing for investment grants and the modification of tax and premiums legislation. Its principal effect was to grant an investment subsidy of 10 % from taxation sources for construction or purchasing costs, to taxpayers in areas along the East-West border, Federal Development regions or Federal improvement areas, who construct or improve business premises or plant after 31 December 1968. The Commission of the European Communities was informed of the proposals in accordance with Article 93 (3) of the EEC Treaty, by means of a note verbale from the Permanent Representative of the Federal Republic of Germany dated 22 April 1969, after the draft law had had its first reading in the Bundestag. The communication was accompanied by the draft law and included an explanation that the draft was only a part of a wide programme for regional economic development. Accordingly the Commission was also informed of further proposals, which are of no further interest now (the Commission has included them in its written observations), partly by means of notes verbales, and partly on the occasion of various bilateral or multi-lateral consultations. After the second reading of the abovementioned draft law, which took place in the Bundestag on 18 June 1969, a number of German regional aid measures came up for discussion with representatives of the then Member States, with the exception of Luxembourg, during a multi-lateral conference arranged by the Commission on 20 June 1969. On that occasion the German delegates provided further details of the draft law and of amendments adopted during the second reading. The same version of the draft law as that issued on 20 June 1969, was approved later by the Bundesrat on 10 July 1969, and, following publication in the Bundesgesetzblatt of 21 August 1969, came into force under Article 5 thereof on 22 August 1969.

The plaintiffs in the main actions, who, in the course of 1969, had undertaken investments in various regions of the Federal Republic of Germany (Kaiserslautern, Kiel, Trier and Leimsfeld) by constructing a goods loading warehouse, building a new warehouse for a department store, opening a self-service fish-restaurant or extending a metal construction and metal working plant, wished to take advantage of this law. However, their applications for a certificate under Article 1 (4) of the Investment Allowance Law, a requirement for obtaining an investment grant, were rejected. One and all, they were refused on the ground that the requirements of the German law had not been met, or to be exact: the proposals could not be regarded as particularly deserving of support from the economic point of view within the meaning of Article 1 (4) of the Investment Allowance Law, since they would not make a significant contribution towards strengthening the economy of the region concerned.

The plaintiffs do not think this conclusion justified, and for that reason they took their claim to the Frankfurt Verwaltungsgericht, after equally unsuccessful appeals, to see if there they might finally obtain these certificates.

The Frankfurt Verwaltungsgericht has now had doubts, during the course of the proceedings, as to the validity of this German law. They are based on Article 93 (3) of the EEC Treaty, which is the provision stating that:

In addition to this, it must be borne in mind that — as we heard from the Commission during the proceedings — the first comprehensive opinion of the proposals notified by the German Government during the period between February and September 1969 was submitted to the Commission by its staff on 18 December 1969. One must also know that on 9 January 1970 the Commission decided to initiate the procedure under Paragraph 2 of Article 93 in respect of the German legislation on regional aid. The Federal Government was notified of this in writing by the Commission on 13 January 1970, and was told, in particular, of the Commission's fear that in certain instances aid was being granted in a manner not compatible with the common market. The same information was given, moreover, to the Frankfurt Verwaltungsgericht at its request on 15 February 1973, with the express explanation that the Commission had not yet reached a final decision.

Nevertheless the Verwaltungsgericht thought it possible that the restriction in Article 93 (3) might continue in every case until the Commission expressed a final decision, and that for this reason a national law already in force might have to be regarded as inapplicable by virtue of Community law.

Since its decision, in the opinion of the court, will depend on clarification of this point, the proceedings were suspended by the abovementioned orders — which were, moreover, expressly declared not to be open to appeal — and the following questions identical in all four cases, were referred for a preliminary ruling:

Now that the written observations of the plaintiffs in the main action, (with the exception of the plaintiff in Case 120/73), the Government of the German Federal Republic, the Government of the United Kingdom and the Commission of the European Communities have been given, and the oral observations of these parties have also been heard, it is my duty to examine the problems raised therein and to give you my opinion on them.

1. Allow me to begin by making two preliminary points.

2. If we turn now to an examination of the actual questions, it must first be recollected that all of them relate to Article 93 (3) of the EEC Treaty. It is also clear that the questions — as the court making the reference noted — qualify and overlap one another. For that reason I think it relevant not to proceed forthwith to a separate examination of each one, but first to place the provision requiring interpretation — as the Commission has done — in its factual context and to start with a basic, systematic survey of the provisions in the Treaty relating to aids.

3. I shall just sum up once more. I am of the opinion that the questions from the Frankfurt Verwaltungsgericht are to be answered as follows:

1 Translated from the German.