The Court of Justice of the European Union (ECJ) on Thursday rejected an appeal filed by Portugal against a decision by the European Commission, which considered that the country had violated competition rules with the aid regime for the Madeira Free Trade Area.
According to a ruling published on Thursday, the Court of Justice of the EU (CJEU) found “partially inadmissible and partially unfounded all of Portugal’s allegations and rejected the appeal.”
Portugal appealed the decision taken by the General Court, considering that the court “misinterpreted the requirement regarding the origin of the profits to which the corporate income tax (IRC) reduction applies.”
The national authorities argued that the court “erred in law in finding that the Commission [Europeia] was right in believing that the requirement for planned IRC cuts […] They could only have as their object the profit obtained as a result of activities “effectively and materially carried out in Madeira”.
Portugal also argued that “in essence, the General Court had misinterpreted the requirement concerning the creation or preservation of jobs”: “It considers, firstly, that the General Court should not have found that the Commission did not impose any requirement on the Portuguese authorities to resort to the methods of determining jobs in “full-time equivalent”, in “annual work units”, limiting itself to stating that these methods “represent the appropriate methods for calculating the number of jobs”,” the Portuguese authorities argued in an appeal that was dismissed by the CJEU.
In December 2020, the Community Executive concluded (as part of an ongoing investigation into the Madeira Free Trade Area since 2018) that Portugal had violated European law, namely the bloc’s competition rules, with the aid regime introduced in December 2020 for that archipelago.
The European Commission has found that Portugal illegally implemented the aid scheme, deeming it “incompatible with the European internal market”, and said the country “must begin to repay the incompatible aid provided under” the scheme.
Author: Lusa
Source: CM Jornal
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