Article 37 - Environmental protection
Key facts of the case:
Appeal – State aid – Article 107(3)(c) TFEU – Articles 11 and 194 TFEU – Article 1, Article 2(c) and Article 106a(3) of the Euratom Treaty – Planned aid for Hinkley Point C nuclear power station (United Kingdom) – Decision declaring the aid compatible with the internal market – Objective of common interest – Environmental objectives of the European Union – Principle of protection of the environment, ‘polluter pays’ principle, precautionary principle and principle of sustainability – Determination of the economic activity concerned – Market failure – Proportionality of the aid – Operating or investment aid – Determination of the aid elements – Guarantee Notice.
Outcome of the case:
On those grounds, the Court (Grand Chamber) hereby:
Dismisses the appeal;
36) Since Article 107 TFEU is considered to apply to State aid such as the measures at issue, other provisions of the FEU Treaty laying down objectives, such as the objective of environmental protection envisaged in Articles 11 and 194 TFEU, must also be applicable and their requirements taken into account by the Commission. In so far as the Euratom Treaty does not provide a specific instrument in order to pursue the objectives of protection of the environment and protection of health, the General Court should have taken account of those objectives and, in connection therewith, the precautionary principle, the ‘polluter pays’ principle and the principle of sustainability in order to determine whether the measures at issue pursue an objective of common interest, while having regard to Article 37 of the Charter of Fundamental Rights of the European Union (‘the Charter’) and to the Court’s case-law stating that protection of health and of the environment are essential objectives.
42) In particular, as the Republic of Austria, supported by the Grand Duchy of Luxembourg, in essence submits, Article 106a(3) of the Euratom Treaty cannot oust the application of, inter alia, Article 37 of the Charter, which states that ‘a high level of environmental protection and the improvement of the quality of the environment must be integrated into the policies of the Union and ensured in accordance with the principle of sustainable development’, Article 11 TFEU, according to which environmental protection requirements must be integrated into the definition and implementation of the Union’s policies and activities, in particular with a view to promoting sustainable development, and Article 194(1) TFEU, according to which Union policy on energy must have regard for the need to preserve and improve the environment. Accordingly, the requirement to preserve and improve the environment, expressed in both the Charter and the FEU Treaty, as well as the principles relied on by the Republic of Austria, which flow from it, are applicable in the nuclear energy sector (see, by analogy, judgment of 27 October 2009, ČEZ, C‑115/08, EU:C:2009:660, paragraphs 87 to 91).
73) That approach is arbitrary and infringes the principle of equal treatment guaranteed in Article 20 of the Charter, as the proportionality of aid for the production of electricity from renewable sources is examined by the Commission within the framework not of the renewable energy market but the overall electricity market.
100) In that regard, it should be recalled that, as is apparent from the examination of the third part of the first ground of appeal, the requirement to preserve and improve the environment, expressed inter alia in Article 37 of the Charter and in Articles 11 and 194(1) TFEU, and the rules of EU law on the environment are applicable in the nuclear energy sector. It follows that, when the Commission checks whether State aid for an economic activity falling within that sector meets the first condition laid down in Article 107(3)(c) TFEU, noted in paragraph 19 of the present judgment, it must, as has been stated in paragraphs 44 and 45 hereof, check that that activity does not infringe rules of EU law on the environment. If it finds an infringement of those rules, it is obliged to declare the aid incompatible with the internal market without any other form of examination.