The Consil of State (Conseil d‘Etat) ruled on a State’s financial contribution for rural development

Conseil d’État 05/10/2016 387375

The present case concerned the rules on support for rural development from the European Agricultural Guidance and Guarantee Fund (EAGGF).
The Minister of Agriculture granted the company Bressor a State’s financial contribution as part of the premium agricultural guidance and a premium for improving the processing and marketing of agricultural products under the (EAGGF).

Following checks carried out in 2007 and in 2008, the Minister of Agriculture issued two decisions on 4 July 2011 by which he ordered the forfeiture of the rights of the Bressor company and requested from the latter the payment of the aid received on the grounds that the company did not respect the purpose of the initial investment project.
On that occasion, the company Bressor lodged a claim before the Administrative Court of Appeal of Lyon (Cour administrative d’appel de Lyon) seeking the annulment of the decisions. The aforementioned court upheld the claim of the company Bressor.
Subsequently, the Minister of Agriculture lodged an appeal before the Council of State (Conseil d‘Etat).
The Minister of Agriculture found that the noticed major difference between the eligible cost of initially retained investment and the eligible expenses actually incurred by the applicant characterizes, by itself, a change in the purpose of the subsidized investments.
The Council of State referred to the Regulation (EC) No 1257/1999 and to the Regulation (EC) No 817/2004.
It found that the amount of the eligible expenses actually incurred at the completion of the project may differ from the eligible cost of initially retained investment by the decisions granting aid and also may result in taking new decisions adjusting the amount of support granted.
The Council of State ruled that the Minister of Agriculture can not reasonably maintain that the company Bressor had committed financial wrongdoing to justify the legality of the contested decisions.
Consequently, the Council of State rejected the appeal of the Minister of Agriculture.

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