German industry wins in anti-competitive ECJ suit

Bavaria and Bavarian industry associations went to the European Court of Justice (ECJ) with a lawsuit against the EU Commission and have won the first round.

In an aid scheme in 2012, the latter had declared that there was anti-competitive spending in the German dairy sector partly financed by the levy under the Milk and Fat Law. Therefore some associations then had to repay millions.

With the judgment of the ECJ, all recoveries are initially off the table, including those directed to dairies. However, it remains to be seen whether the Commission is calling on a higher court.

At the time the EU Commission took the view that the levy, which was levied in nine out of 16 federal states, was unilaterally beneficial only to dairies, but not to farmers, since the funds raised by farmers flowed into the economy as subsidies.

The Association of the German Dairy e.V. (VDM) was financed with a part of the transfer funds. This umbrella organisation lost its financial basis due to the EU Commission and was subsequently integrated into the German Farmers’ Association.

Therefore the Bavarian state government and the associations of the private dairy industry together with the Bavarian co-operative association had subsequently brought an action before the ECJ against the decision of the Commission.

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