Brussels, 13th November 2007
EU Competition Commissioner Neelie Kroes said: "The Commission has granted Belgium the period of transition that it desired in 2003 and from which the companies concerned have in fact benefited. It would not, however, have been reasonable to authorise all centres to benefit until the end of 2010 from a system that ceased to be compatible in 2003".
On 22 June 2006, the Court of Justice of the European Communities confirmed that the coordination centre system constituted a state aid scheme incompatible with the common market. The Court annulled the Commission Decision of 17 February 2003 only in so far as it does not provide transitional measures for "those coordination centres whose request for re-authorisation was pending on the date the contested decision was notified or whose authorisation expired at the same time the aforementioned decision was notified or shortly thereafter".
The Court ruled that by prohibiting with immediate effect the renewal of authorisation, the Commission violated the principle of legitimate expectation by depriving certain centres of an appropriate transition period to quit the system. In the Court's view, the Commission also violated the principle of equality by giving to these centres an insufficient transition period – a few months – while other centres were able to benefit from the system until the end of 2010. The Court went on to say that the expression "shortly" referred to a date so close to that of the decision of 17 February 2003 that the centres concerned did not have the necessary time to adapt to the new system.
The decision of 17 February 2003 authorised the centres to continue to take advantage of the system until the expiry of their current authorisation or 31 December 2010, whichever came first. In Belgium's view, it was entitled, based on the principle of equality, to prolong the existence of all the coordination centres until 31 December 2010, and it adopted the law of 27 December 2006 to this end. Moreover, the deadline of 2010 was justified, in Belgium's view, by the alleged need to make the new transition period run from the date of the new decision rather than from 17 February 2003.
The decision adopted today rejects these arguments. The Commission considers that the Court explicitly limited the scope of the annulment of the decision to cover the situation of certain centres whose authorisation expired shortly after the decision of 17 February 2003 and that it would be advisable to limit the definition of the new transition period to these centres that have not had a sufficiently lengthy transition period. Moreover, the ruling declaring the system incompatible with the common market was valid as from 17 February 2003, and the transition period actually began on 17 February 2003 for the centres concerned owing to the suspension of the ban on renewal of authorisations ordered by the Court on 26 June 2003.
On the basis of the elements in its possession, the Commission concludes that the transition period that it should have provided for in its decision of 17 February 2003 to enable the coordination centres to adapt to the change of arrangement should have run from 17 February 2003 to 31 December 2005. Logically, the companies to which this new transition period applies are those whose authorisation expired no later than 31 December 2005.
The Commission determined this period to be appropriate on the basis, in particular, of (1) the positions expressed by Belgium and the coordination centres after the decision of 17 February 2003 to the Commission, the Council of the European Union or the Court, (2) estimates by the recipients of the period necessary to adapt to the end of the system, (3) the entry into force of new tax measures providing the centres with an attractive alternative and, especially, (4) the limit fixed by Belgium at 31 December 2005 for authorisations renewed since 17 February 2003.
For those centres whose current authorisation expired after 2005, the transition period remains valid – until the expiry of their authorisation or the end of 2010, whichever comes first. Pursuant to the law of 27 December 2006, the effects of the system will not be able to be retained by new extensions of authorisations.