18 February 2016

Ombudsman finds no maladministration by Commission relating to its handling of state aid complaints

On 15 February, the European Ombudsman (Ombudsman) published its decision in relation to how the European Commission (Commission) handled complaints concerning illegal state aid to Spanish football clubs.

Between July 2011 and May 2012 the complainant, a Spanish national and shareholder in a football club (unidentified), submitted information to the Commission regarding three cases of alleged illegal state aid to Spanish football clubs. The three complaints concerned (i) non-payment of taxes and social security contributions by all Spanish football clubs, (ii) real estate transactions between a football club and the local administration, and (iii) a bank loan granted to a football club by a publicly owned commercial bank.

In 2013, the complainant requested access to documents in relation to the first and second cases, which concerned correspondence between the Commission and Spain. However, the Commission denied access to the documents on grounds of protection of the purpose of investigation, this position was then confirmed when the complainant asked the Commission to review its decision.

The complainant then sought the involvement of the Ombudsman in September 2013 in relation to (a) the Commission’s handling of his three complaints and (b) the decision to refuse access to documents.

The arguments

The Ombudsman took account of both parties’ opinions and inspected the Commission’s file.

The complainant argued in relation to the first case, that the Commission had failed, under the Code of Best Practice for the conduct of State aid control procedures, to use its best endeavours "to investigate a complaint within an indicative time frame of twelve months from its receipt". Within 12 months of receiving the complaint the Commission should endeavour, either to make a decision or, on a non-priority case, send an initial administrative letter. The complainant argued he had not received either such communication and further, the Commission ought to have opened a formal investigation on the basis that it was clearly having serious difficulties in its preliminary examination.

The Commission argued that it had informed the complainant by letter, on 10 August 2011, that there were insufficient grounds for the Commission to take further action and invited the complainant to provide more information. The complainant did not produce additional information so the first complaint was deemed withdrawn. The complainant however explained that he had not received such communication, and in any case, the Commission cut across its own argument when it later said, in relation to the request for access to documents, that these were part of an ‘ongoing investigation’ and secondly, the Commissioner said at a press conference in December 2013 that no decision had been taken in the case.

The Ombudsman found that the Commission had, of its own initiative, reopened the first case, which the complainant said, following its initial decision to close the case, constitutes an abuse of law. Further, the Ombudsman noted  that given that the Commission was clearly having difficulties in conducting an investigation during the preliminary stage (12 months), it ought to have opened a formal investigation.

In relation to the second case, the Commission informed the complainant that it had opened a preliminary investigation and, following the complainants action of involving the Ombudsman, it informed him that it had taken the decision to open a formal investigation.

In the third case, the Commission informed the complainant that it had opened a preliminary investigation and then further informed him, five months later, that it had decided not to take a decision and had closed the investigation. The complainant argued that this was contrary to Article 13 of Regulation 659/1999, requiring the examination of possible unlawful aid to result in a decision.

Finally, in relation to access to documents, the complainant argued that these requests ought to have been considered in light of his complaints. The Commission argued that granting access would have undermined the protection of the objectives of the investigation.

The Ombudsman’s findings

The Ombudsman found that in the first case, the letter of 10 August 2011 was sent to the complainant’s email address. The letter correctly informed the complainant of the current position and it is not the fault of the Commission that the complainant did not receive the letter. In re-opening the case, the Commission had not abused its powers, this may have been done due to new information coming to light.

In the second case, the Ombudsman made recommendations to the Commission that a decision should be made as soon as possible – two days after the recommendation, the Commission took the decision to open a formal investigation. Consequently the Ombudsman found no maladministration.

Relating to the third case, the Ombudsman noted that the Commission need only make a decision and provide a copy to the complainant, where they are an 'interested party', as per Regulation 659/1999. The Ombudsman agreed with the Commission, that the complainant, as a shareholder of a competing company, was not an interested party. The Commission was therefore not under an obligation to make a formal decision and provide a copy of the decision to the complainant.

Finally, regarding access to information, the Ombudsman made it clear that such a request is for public access and the fact that the request was made by the complainant was irrelevant. Further, the Ombudsman was satisfied that the reasons in the complainant’s request, as well as his confirmatory request, were insufficient – there was no overriding public interest in this case.

Overall the Ombudsman's conclusion was that there was no maladministration by the Commission.

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