Opinion of Mr Advocate General Van Gerven

Mr President,

Members of the Court,

1. In the present application the Italian Government seeks the annulment of Commission Decision 89/661/EEC of 31 May 1989 concerning aid provided by the Italian Government to Alfa Romeo. The contested decision is based on the first subparagraph of Article 93(2) of the Treaty, and is in the following terms:

Factual background

2. It appears from the contested decision that at the time of the capital contributions which form the subject matter of the decision the Alfa Romeo group, the second largest car manufacturer in Italy had to contend with a very serious crisis. In 1986 only 42% of its production capacity of 400000 vehicles per year was used, and in 1985 and 1986 the group incurred losses of LIT 465.5 thousand million and LIT 313.3 thousand million respectively. These problems were not of recent origin. Alfa Romeo, which formed part of the Finmeccanica holding company, controlled in its turn by the public holding company IRI (Istituto per la Ricostruzione Industriale, Industrial Restructuring Agency), had already been operating at a loss for 14 years. During the period from 1979 to 1986 the group accumulated losses of LIT 1484.5 thousand million and fresh capital of LIT 1387.5 thousand million was contributed by the Italian Government.

3. The revised restructuring plan of 1983/1984 certainly did not lead to Alfa Romeo's recovery; on the contrary, the situation of the group deteriorated yet further. The expected improvements in labour productivity and product quality were not achieved, the rate of capacity utilization remained low and the financial results worsened dramatically. In 1983 the Alfa Romeo group suffered losses of LIT 121.7 thousand million, in 1984 LIT 210.9 thousand million, in 1985 LIT 465.5 thousand million and in 1986 LIT 313.3 thousand million. Against that background studies were carried out by Finmeccanica and IRI and also by the appropriate government and parliamentary bodies to determine future strategy. Those assessments showed that Alfa Romeo could not become profitable as an independent producer and that the only possible solution was its takeover by (or merger with) a large motor vehicle manufacturer which would be prepared to make massive investments. The contested decision shows that at the beginning of 1986 the world's leading automobile manufacturers were approached to find out whether they were interested in taking over Alfa Romeo, either wholly or in part.

4. Alarmed by press reports that Alfa Romeo had received aid in 1985 in the form of a capital injection of LIT 209 thousand million, on 1 October 1986 the Commission requested further information from the Italian Government. By a letter dated 21 November 1986 the Italian Government confirmed that new capital in the amount of LIT 206.2 thousand million had been allocated to Alfa Romeo SpA, through Finmeccanica and IRI, in order to cover losses. During the written procedure before the Court, the Italian Government stated that that capital contribution was linked to the decision to proceed with the triennial investment programme (1986 to 1988) mentioned above.

5. As already stated, the Italian Government raises a number of pleas in support of its application for a the annulment of the contested decision which, in the light of the Court's case-law and the factual situation, are manifestly unfounded. I shall deal with these arguments first. In my Opinion of 11 October 1990 in Case 303/88 I have already dealt with a number of those pleas.

Aid provided by the State or aid publicly funded in any way

6. As its first plea the Italian Government argues that the capital injections in 1985 and 1986 did not constitute State aid within the meaning of Article 92(1) because those contributions were not the result of decisions taken by the public authorities but were autonomous corporate decisions taken by the directors of IRI and/or Finmeccanica. Moreover, the public funds were not specifically earmarked for the contributions in question.

Aid which distorts or threatens to distort competition and/or affects trade between Member States

7. The Italian Government further submits that the capital contributions made to Alfa Romeo in 1985 and 1986 did not constitute State aid within the meaning of Article 92(1) because they did not distort or threaten to distort competition and did not affect trade between Member States (sixth plea). It points out that Alfa Romeo's share of the European market amounted to only 1.6% and that the aid did not cause a reduction in the market share held by Alfa Romeo's competitors.

The belated initiation of the procedure and the failure to notify the aid

8. It is clear — contrary to the Italian Government's assertion (fourth plea) — that the Commission cannot be criticized for the belated initiation of the procedure provided for in Article 93(2). It is true that the procedure was initiated only in July 1987 and that the contested decision was made in May 1989, while the aid was granted in 1985 and 1986 and the Commission requested information for the first time in October 1986. However, it is apparent from the contested decision that responsibility for the belated initiation of the procedure lies entirely with the Italian Government, first because it did not give prior notification of the aid and secondly because it supplied the information requested by the Commission only bit by bit and at the latter's insistence.

The criterion of the reasonable investor and equality of treatment as between private and public undertakings

9. I shall now turn to a number of submissions which merit closer attention. In support of its application for annulment the Italian Government maintains that the Commission relied on insufficient and incorrect arguments to show that the 1985 and 1986 capital injections would have been unacceptable for a private shareholder or investor (second plea). That is indeed the criterion which the Court has consistently applied in order to assess whether capital holdings may constitute State aid. In applying that criterion in this specific case, the Italian Government argues, the Commission took no (or insufficient) account of a number of special circumstances such as:

10. For its part, the Commission backs up its assessment that a private investor would not have made any fresh capital contribution by referring to the rapid increase in losses since 1983, the considerable increase in Alfa Romeo's debt burden, its negative cash flow and the lack of any reasonable return on the capital injected. As has already been mentioned, the injection of LIT 206.2 thousand million in 1985 was intended, as the Italian Government acknowledges, to cover the losses suffered by Alfa Romeo SpA in 1984 and during the first quarter of 1985, while the contribution of LIT 408.9 thousand million in 1986 was intended to recapitalize Alfa Romeo Auto, since otherwise that company would have had to be liquidated. Alfa Romeo Auto used the funds made available to it to repay its debts to Alfa Romeo SpA, whereby the latter was enabled to reduce its own debt burden. In other words, the capital injections were exclusively intended to reduce the net financial liabilities of the Alfa Romeo group and were not intended to help finance the implementation of an investment programme.

11. Before stating my views on this dispute, I should like to dwell for a moment on the criterion of the private investor, to which both parties refer and which is based on the Commission's settled practice and the Court's case-law. That criterion is based, in the words of the Court, on the opportunities open to the undertaking of acquiring the amounts in question on the capital market.

12. It seems to me that the criterion of the private investor must take into account both categories of investors and must consequently be understood as referring to a reasonable investor, whether private or public in nature. In that way the criterion may be used in order to assess the conduct of both a private and a public investor, and the submission with regard to the unequal treatment of private and public undertakings must therefore fail.

13. I have examined in greater detail the criterion of the private investor — or rather, the reasonable investor — in order to dispel any misunderstanding with regard to inequality of treatment as between private and public undertakings. In concrete terms, however, this discussion is of less relevance, because the reasonable investor criterion, whether it is applied to one of the categories of investors or the other, means that a contribution of risk capital to a loss-making undertaking which is heavily in debt and has insufficient cash flow may be deemed to be reasonable only where the undertaking can put forward a general restructuring plan which is sufficiently detailed, credible and realistic. Only on the basis of such a plan may a reasonable investor be persuaded that the undertaking in difficulties has a real chance of recovery and that a fresh injection of capital will be effective.

14. I share the Commission's view that the Italian Government has not shown in what way the funds injected into the company in 1985 and 1986 formed part of a new general restructuring plan. Following the failure of the 1980 ten-year plan, even after its revision in 1983/84, there was a clear need for a new investment policy aimed at a complete restructuring of the undertaking. By that I do not mean to say that the earlier efforts produced no results, but that it was already apparent in 1985 and 1986 that the earlier plans were inadequate. The assessments made in 1985 and 1986 by Finmeccanica, IRI and the competent public bodies showed that Alfa Romeo could not be made profitable unless it was taken over by a large automobile manufacturer which would provide it with massive support (see section 3 above). The injection of the new funds in question thus appears to be one of many attempts to ensure the group's survival. A capital injection intended to absorb accumulated losses and to alleviate the debt burden is of course an essential element of any restructuring plan. However, this is not sufficient unless other aspects of the plan provide for a drastic reduction in costs and major investments in order to rationalize production capacity and improve labour productivity. That is certainly true in a sector faced with a problem of considerable surplus capacity.

Aid granted with a view to the takeover of the undertaking

15. In the course of the written procedure before the Court, the Italian Government argued that the contested aid measures were justified because they were intended to protect the undertaking from possible liquidation pending its sale (second plea) or the successful outcome of a restructuring plan (fifth plea).

The grounds relied on to justify the aid and the obligation to provide a statement of reasons

16. The Italian Government submits a number of pleas relating to possible grounds on which the aid granted might be justified. With reference to Article 92(3)(a) and (c) of the EEC Treaty, it points out that the aid was intended to maintain employment in areas of the Mezzogiorno (eighth plea) and that it sought to promote the development of certain forms of economic activity or certain regional economies under the conditions laid down by the Commission in its abovementioned decision in the Rover case (eleventh plea). It further points out that the grant of the aid may also be justified in the context of the ECSC Treaty as conversion aid in areas where there is considerable unemployment as a result of the crisis in the steel industry (ninth plea). In assessing the interests at stake, the Commission, moreover, failed to take account of the positive compensatory effects of the aid on the development of specific regions or activities (seventh plea). In any event, in the present case the Commission adopted a less accommodating attitude than in other cases, such as Daimler Benz, or Renault (tenth plea). The reasoning upon which the decision is based is inadequate, particularly with regard to the link between the aid and the restructuring of Alfa Romeo at which that aid was directed (twelfth plea).

17. With regard to the plea relating to the ECSC Treaty, I share the Commission's view that there is nothing to indicate that the aid at issue was granted in conformity with the applicable provisions (see Article 56 of the ECSC Treaty). All the other pleas once again come down to the question whether the two capital contributions formed part of a restructuring plan aimed at the complete reorganization of Alfa Romeo which, if it were successful, would contribute to lasting prosperity and stable employment in the sector and region concerned. Only in such a case is it possible to speak of aid to promote the economic development of areas where the standard of living is abnormally low or where there is serious under-employment (Article 92(3)(a))or of aid to facilitate the development of certain economic activities or of certain economic areas (Article 92(3)(c)). Aid which does not envisage any lasting effect does not fall within those provisions and in sectors where intra-Community trade is intense it is likely merely to affect trading conditions in a manner harmful to Community interests.

18. The Commission has a wide discretion in assessing the circumstances under which an aid measure may exceptionally be authorized on the basis of Article 92(3). In the exercise of that discretion, it sets out in detail in Part X of the contested decision the reasons for which the measures examined by it do not accord with its policy. In that connection, it attaches great importance to the lack of a restructuring plan containing measures to reduce unused production capacity. It points out that in a sector which in 1985 and 1986 had considerable excess production capacity in the Community, only recovery measures capable of assisting in resolving that problem may be deemed to assist in the recovery of that sector. It emphasizes that it has consistently adopted that attitude in similar cases such as the grant of aid to Renault and Rover.

19. In relation to the statement of the reasons on which the decision is based, I should like to make a further general observation. It appears from a reading of decisions in similar cases, such as Renault and Rover, and from a comparison of them with the present decision, that the statement of reasons in the former decisions is more specific and more detailed. In those cases the aid measures were notified to the Commission beforehand and/or were discussed with the Commission under the Article 93(2) procedure on the basis of detailed information. Where a Member State's failure to notify aid measures and the inadequacy of the information supplied by it hampers the administrative investigation and affects the reasoning on which the decision taken is based, responsibility for that situation lies solely with the Member State concerned. It may, moreover, be inferred from the Court's case law that the legality of a contested decision must be assessed on the basis of the information available to the Commission at the time when it took its decision.

Recovery of the aid

20. Article 2 of the contested decision provides that the Italian Government must recover the aid referred to in Article 1 from Finmeccanica within a period of two months. The Italian Government alleges that that recovery requirement is not justified (fourteenth plea). First of all, it observes that the EEC Treaty provides for the abolition or alteration of aid measures, and not recovery of aid granted. It goes on to argue that even if recovery of aid may, nevertheless, be required, such requirement does not follow automatically from the illegality of the aid. Recovery may be required by the Commission only when that is necessary in order to bring an end to the distortion of competition caused by the aid and such a decision must contain an explicit statement of reasons, which the Commission did not provide. Moreover, the recovery of the aid from Finmeccanica cannot bring an end to distortion of competition in the motor vehicle sector — on the supposition that any distortion remains following the sale of the main assets to Fiat — since Finmeccanica is not itself active in that sector. The recovery from Finmeccanica of the aid must therefore be regarded as a penalty which is not provided for by the Treaty. Finmeccanica should be liable only for Alfa Romeo's old debts and hidden liabilities, and cannot be liable to any penalties.

21. As regards the observations concerning the possibility of recovering aid and the reasoning requirement, it is sufficient to refer to the Court's case law. As early as 1973, in its judgment in Case 70/72, the Court held that in order for the abolition or alteration (as provided for in Article 93(2)) of an aid measure to be effective, it may be accompanied by an obligation to repay the aid found to be contrary to the Treaty. Recovery, the judgment in Case C-142/87 adds, is the logical consequence of a finding of invalidity, which, it may be inferred, thus requires no specific reasoning.

22. It seems to me correct that recovery may in no event be required of Fiat, since that undertaking took over only certain specified assets of Alfa Romeo for a price found by the Commission to be appropriate, and restricted its financial liability for Alfa Romeo's debts on the takeover to LIT 700 thousand million (indeed, the acquirer of specific assets would not normally have any such liability). On the other hand, it appears from the contested decision that all debts not taken over by Fiat — and the remaining assets except for certain credits — were transferred to Finmeccanica (see section 3 above, in fine). Moreover, the Italian Government does not deny that Finmeccanica is liable for Alfa Romeo's remaining debts (with the exception, it says, of liability to repay the aid granted on the ground that such repayment amounts to a penalty for which there is no liability).

23. It may be seen from the foregoing that it is a general rule applicable to the recovery of unlawfully paid aid that the aid must be recovered from the beneficiary or the party which has taken over liability for repayment from the beneficiary. In the present case, that is Finmeccanica to which all Alfa Romeo's remaining liabilities (and assets) were transferred. If that transfer had not occurred, the repayment obligation would have remained with the original Alfa Romeo companies, the beneficiaries of the aid, even if, meanwhile, the shares in those companies had passed into other hands. If, on that hypothesis, those companies had been placed in liquidation, it would have been for the liquidators, under their personal responsibility to make provision for repayment of the aid.

Conclusion

24. I propose that the Court dismiss the action for the annulment of the contested decision and order the Italian Government to pay the costs.

1 Original language: Dutch.

2 OJ L 394, p. 9.

3 The structure of the Alfa Romeo group after the capita! contributions which form the subject ot the contested decision is described in the first paragraph of Part VI of the decision

4 Third paragraph of Part VI of the contested decision In 1985 the net financial liabilities of Alfa Romeo amounted to LIT I 427.7 thousand million.

5 First paragraph of Part VI of the contested decision

6 First paragraph of Part V of the contested decision

7 Second paragraph of Part VII of the contested decision

8 The principal aspects of the new production plan, which was aimed at a break-even point of approximately 30000C vehicles a year, were. (1) renewal of the model range and shortening of the production life of models, (2) an agreement with the Fiat group for the production ot common components, and (3) a joint venture with the Japanese firm Nissan for the production of a new light car (Arna) for which Alfa Romeo would supply the same engines as those used in the Alfasud (third paragraph or Part V of the contested decision)

9 Third paragraph of Part V of the contested decision

10 Fourth paragraph of Part V of the contested decision.

11 Fifth paragraph of Part V of the contested decision.

12 Fifth paragraph of Part X of the contested decision ; and see also the application, at p. 6, third paragraph. In the contested decision the Commission states that the investment plan (1986 to 1988) was also aimed at the development of new markets, but that was contested by the Italian Government during the written procedure (application, p. 49, first paragraph).

13 Fifth paragraph of Part X of the contested decision.

14 With regard to the capital contribution for 1986, see the fifth paragraph of Part X of the contested decision; with regard to the capital contribution for 1985 see the application, at p. 6, third paragraph.

15 In 1986, production capacity was still 400000 vehicles per year with a rate of utilization of 42% (second paragraph of Part VI of the contested decision).

16 Sixth paragraph of Part V and second paragraph of Part VI of the contested decision.

17 Second paragraph of Part VII of the contested decision.

18 Seventh paragraph of Pan V of the contested decision. In the contested decision the Commission does not discuss the conclusions of those assessments in detail owing to their confidentialnature. In the course of the written procedure, the Commission stated that an assessment by the First Boston Corporation showed inter aha that Alfa Romeo would incur tosses until 1996, and that the group required massive investments (LIT 4000 thousand million according to Ford and LIT 5000 thousand million according to Fiat) which, owing to the limited levels of production, could not offer an appropriate return on investment (ROI)

19 Eighth paragraph of Part V of the contested decision.

20 Twelfth paragraph of Part V of the contested decision.

21 Thirteenth and fourteenth paragraphs of Part V of the contested decision Fiat also took over LIT 700 thousand million of the net financial liabilities of the Alfa Romeo group (fourteenth paragraph of Part V of the contested decision).

22 Fifteenth paragraph of Part V of the contested decision. Ftnmilano and Sofinpar retained the possibility of utilizing tax credits accumulated through the losses, which was the main reason for the acquisition by the two banks.

23 Second paragraph of Part XI of the contested decision The decision speaks of the liquidation of Alfa Romeo SpA. which had however changed its name to Finmilanoin May 1987

24 Second paragraph of Part I of the contested decision. There is little specific information on this capital injection. The decision states that it was a capital contribution made by two legal persons, namely Finmeccanica and IRI; it is not known in what proportion. It also appears that following this capital increase Alfa Romeo SpA was owned as to 84% by Finmeccanica and as to 16% by IRI. The capital contributed is said to have been provided by the Italian state (see below, footnote 35). The money was used by Alfa Romeo to cover losses suffered during the 1984 financial year and the first half of 1985 (losses which amounted to LIT 98 thousand million and LIT 111 thousand million respectively), from which I infer that a reduction in capital of LIT 209 thousand million occurred immediately after the increase in capital.

25 Application, p. 6, third paragraph, and p. 22, last paragraph.

26 Third, fourth, fifth, sixth and seventh paragraphs of Part I of the contested decision.

27 Parts II and III of the contested decision. It appears from the decision that in 1986 Alfa Romeo Auto had to reduce its capital by LIT 316.4 thousand million in order to cover losses suffered in 1985 and in the first quarter of 1986, following which the company's capital was no more than LIT 20.2 thousand million. After the contribution of LIT 408.9 thousand million made by Finmeccanica and its subsidiary Saige, Alfa Romeo Auto was owned as to 49% by Finmeccanica, as to 33.4% by Alfa Romeo SpA, and as to 17.6% by Saige (the shareholding of Alfa Romeo SpA resulting from a contribution of LIT 200 thousand million which, if I understand the matter correctly, was made at the same time as the abovementioned contributions: see the second paragraph of Part VII). The LIT 408.9 thousand million injected into the company came from IRI, which financed that contribution by means of a loan on which the interest was paid by the Italian state (see footnote 35).

28 First paragraph of Part III of the contested decision; see also tne eleventh and twelfth paragraphs of Part VII of the contested decision.

29 Second paragraph of Part IV of the contested decision.

30 Although the two offers were not identical and were therefore difficult to compare, the Commission found that the offer made by Ford was on average a little more favourable but in contrast to Fiat's offer entailed future commercial risks for Finmeccanica. That justified Finmeccanica in opting in favour of Fiat (seventeenth paragraph of Part VII of the contested decision).

31 Last paragraph of Part VII of the contested decision

32 Article 1 of the contested decision.

33 Article 2 of the contested decision.

34 Case 303/88 llaly v Commission [1991] ECR I-1433, I 1451.

35 Judgment in Joined Cases 67, 68 and 70/85 Van der Kooy v Commission [1988] ECR 219, paragraphs 35 to 38. See also the judgment in Case 290/83 Commission v France [1985] ECR 439, paragraph 15, and my Opinion cited in footnote 33 above, at paragraphs 6 and 7.

36 The 1985 capital injection was made with part of IRI's funds which it obtained under Article 14 of the 1985 Italian budget for the recapitalization and stabilization of undertakings, in particular in the automobile sector. Finmeccanica, which itself did not have the necessary funds available, obtained the capital which it contributed from IRI. For the 1986 capital injection Finmeccanica, which again in that year did not itself have the necessary funds once more received from IRI the capital contributed by it (and by its subsidiary, Saige). IRI raised the funds by making use of the possibility provided for in Decree Law No 547/85 of 19 October 1985 and the 1986 budget of taking out loans on which the interest was paid by the State.

37 No such formal connection was present in the Van der Kooy case (footnote 34), for example, in which the aid was not in fact borne by the exchequer.

38 France v Commission [1988] ECR 4067, paragraph 19.

39 See in more detail on that point my Opinion of 11 October 1990 in Case 303/88, cited above in footnote 33, at paragraph 19.

40 Contested decision, Parts I to III

41 That, it says, is particularly true of the 1985 capital contribution According to the Italian Government tne intention to provide aid was apparent from the 1985 budget. Law No 887/84, cited above in footnote 35, which was published in the Italian official gazette and was thus presumed to be known by all (and therefore also by the Commission)

42 Case 301/87 France v Commission [1990] ECR I-307, at paragraphs 19 to 24

43 See, for example, the judgment in Joined Cases 296 and 318/82 Netherlands and Leeuwarder Papierwarenfabriek v Commission [1985] ECR 809, at paragraph 20; the judgment in Case 234/84 Belgium v Commission, Meura, [1986] ECR 2263, at paragraphs 14 and 15; the judgment in Case 40/85 Belgium v Commission, Boch II, [1986] ECR 2321, paragraphs 13 and 14; the Francev Commission judgment cited in footnote 41 above and the judgment in Case C-142/87 Belgium v Commission, Tubemeuse, [1990] ECR I-959, paragraphs 26 and 29.

44 Application, p. 18.

45 Application, pp. 18 and 19.

46 Application, p. 19, point 3.

47 Application, p. 20, point 4. According to the contested decision, Finmeccanica ultimately received LIT 1223.5 thousand million for the sale of Alfa Romeo (LIT 1024.6 thousand million from Fiat and LIT 198.9 thousand million from the Banco di Roma and Credito Italiano), which, according to the Italian Government, is much more than the amount of the capital contributions in 1985 and 1986. The Commission, however, observes that the amount to be paid by Fiat was spread over five years beginning on 2 January 1993 and consequently, discounted to 1 January 1987, amounted only to LIT 389.9 thousand million (contested decision, Part VII, eighteenth paragraph and footnote).

48 Application, p. 6 and pp. 22 to 23.

49 Application, pp. 20 to 23.

50 Application, p. 24.

51 Application, p. 24.

52 Application, p. 25.

53 Contested decision. Part VII, ninth paragraph

54 See footnotes 23 and 26 above.

55 See section 4 above and the reference there to the contested decision

56 See the judgmcnts already cited above in footnotes 41 and 42, Case 234/84 Belgium v Commission, Meura, at paragraph 14, Case 40/85 Belgium v Commission, Boch II, at paragraph 13, Case 301/87 France v Commission, Boussac, at paragraph 39, and Case C-142/87 Belgium v Commission, Tubemcuse, at paragraph 26.

57 See the judgments in Case 234/84 Meura, at paragraph 14, and Case 40/85 Boch II, at paragraph 13, already cited in footnote 42.

58 See my Opinion cited in footnote 33, at paragraph 14.

59 At the hearing the agent of the Italian Government referred to a number of private groups whose component companies had for a long period suffered losses. Such comparisons must be treated with caution. They were often small parts or subsidiary companies of groups which were profitable as a whole. The loss-making nature of a company in a group is influenced by a whole series of factors (not least those of a fiscal nature) which can lead to a situation in which as a result of transfer pricing or other income transfers, profits or losses within the group are concentrated at one point or another. There is no evidence that such transfers within IRI or Finmeccanica might have contributed to Alfa Romeo's losses; quite the contrary.

60 See the references to the contested decision in footnotes 24,28 and 13

61 Contested decision. Pan X, seventh paragraph

62 Commission Decision 88/454/EEC of 29 March 1988 concerning aid provided by the French Government to the Renault group, an undertaking chiefly producing motor vehicles (OJ L 220, p 30).

63 Commission Decision 89/58/EEC of 13 July 1988 concerning aid provided by the United Kingdom Government to the Rover group, an undertaking producing motor vehicles (OJ 1989 L 25, p 92).

64 Italy also refers to the Daimler Benz case, in which the Commission terminated the Article 93 procedure (Sixteenth Report on Competition Policy 1986, point 230). According to the Commission, that case also involved productive investments.

65 Contested decision, Part X, first paragraph.

66 Contested decision, Part IV, second paragraph.

67 Cited above in footnote 62

68 Contested decision. Part V, sixteenth paragraph.

69 Cited above in footnote 62

70 See footnote 63.

71 Cited above in footnote 61

72 See the Boussac judgment cited above in footnote 41, at paragraph 54.

73 Contested decision. Part X, sixth paragraph

74 Contested decision. Part X, seventh paragraph

75 Judgment in Case 730/79 Philip Marris v Commission [1980] ECR 2671, at paragraphs 16 and 17

76 See, for example, the Meura ludgment cited in footnote 42 above, at paragraph 16.

77 Judgment in Case 70/72 Commission v Germany [1973] ECR 813, paragraph 13.

78 See the Tubemeuse judgment cited above in footnote 42, and the judgment in Case 310/85 Deufil v Commission [1987] ECR 901, at paragraph 24.

79 Contested decision, Part XI, second and third paragraphs.

80 Contested decision, Part XI, fourth paragraph.

81 Contested decision, Part V, fifteenth paragraph.

82 In the Italian Government's application, it is stated at page 54 Moreover, Finmeccanica in fact merely took over previous debts and unforeseen liabilities of Alfa Romeo (but with the exception, it goes on, of what it calls penalties) To justify recovery of the aid from Finmeccanica the Commission refers, on page 20 of us defence, to the liability of Finmeccanica (which held more than 99% of Alfa Romeo's capital), for the totahty of Alfa Romeo's debts in accordance with Article 2362 of the Italian Civil Code In its replv, the Italian Government docs not dispute that obligation It merely asserts that in fact, it is not relevant io argue that, under Italian law, Finmeccanica is liable for Alfa Romeo's debts

83 It is not clear whether that liability is based on Article 2362 of the Civil Code, as the Commission states in us defence, cited above in footnote 81, or whether it stems from a commitment freely entered into by Finmeccanica or for which it is otherwise liable, whether or not in the context or as a result of the liquidation of the Alfa Romeo companies (sec contested decision, Pan XI, second paragraph).

84 See the Tubemeuse judgment cited above in footnote 42, at paragraph 66.