The trade organisation Danske Slagtermestre has brought an action before the General Court regarding the European Commission's decision of 18 April 2018 stating that a Danish discount scheme for waste water charges did not constitute state aid.

The European Commission’s decision arose from a complaint filed in 2013 by Danske Slagtermestre after the introduction of the so-called stepped model in the waste water regulation. Under this model, a discount is given on waste water charges according to consumption so that a high consumption will give a high discount. This is different compared to the previous charge scheme with a fixed charge.

Danske Slagtermestre, which represents small and medium-sized slaughterhouses, believes that the stepped model constitutes state aid because it favours major slaughterhouses in Denmark which may obtain higher discounts on the waste water charge and therefore obtain a financial advantage.

In a press release of 16 August 2018, Danske Slagtermestre states that the petition concerns the European Commission as well as the Danish competition commissioner. Danske Slagtermestre believes that Margrethe Vestager is biased in the case regarding waste water charges because she was a part of the government in 2013, where she contributed to the implementation of a relief on waste water charges for bigger companies, and now she is the one signing the Commission's decision of 18 April 2018.

Furthermore, Danske Slagtermestre believes that the Commission has violated the basic principle of the right to be heard since Danske Slagtermestre did not have the opportunity to comment on the decision.

THE EUROPEAN COMMISSION: THE CHARGE SCHEME IS LAWFUL

In its decision of 18 April 2018, the European Commission concluded that the charge scheme did not constitute state aid.

The European Commission assessed that a private investor subject to the same rules as the waste water companies would introduce quantity discounts like the ones on the stepped model. This is due to the fact that the discount gives waste water plants the opportunity to attract and keep major customers, which would otherwise consider handling their own waste water. Also, the major customers’ discount rates exceed the actual costs relating to the plant, and they thus continue to contribute to the profitability. In addition, the discount rates are not reserved for specific customers; on the contrary, they apply to everybody.

It was therefore the opinion of the European Commission that the charge scheme did not imply that specific companies were favoured. The General Court is now to assess the European Commission’s decision.

contacts

Andreas Christensen

Partner

Marie Løvbjerg

Attorney