State Aid Uncovered Blog

A natural person is not an undertaking if he/she only has a controlling interest [e.g. majority of capital or voting rights] in an enterprise that engages in economic activities [i.e. it is an undertaking].  For a natural person to be considered to be an undertaking he/she must have both a controlling interest in an enterprise and be involved directly or indirectly in its management.  Exercising shareholder rights through participating and voting in the annual general meeting of shareholders does not constitute direct or […]

The discount rate for calculating the present value of state aid granted in tranches is the reference rate; i.e. base rate plus 100 bp. The discount rate for calculating the present value of an investment project is the weighted average cost of capital of the investor. Introduction When state aid is granted in instalments, the amount of future tranches has […]

A municipality that develops commercial infrastructure engages in an economic activity.  A municipality that finances the development of commercially used infrastructure may grant state aid to itself.  The selection of the operator of commercial infrastructure on the basis of a competitive procedure eliminates any advantage for the operator.  The users of a commercially operated infrastructure do not receive state aid if they pay prices at market […]

State aid may cover up to 100% of the funding gap of a project.  The funding gap demonstrates that the aid has an incentive effect.  The aid is proportional if it does not exceed the funding gap.  State aid in the fisheries sector may have to comply with both Regulation 2022/2473 [FIBER] and the fisheries guidelines.  Introduction The Commission recently approved the granting of […]

The amount of state aid embedded in a public guarantee is the difference between the market rate of the premium and the premium, if any, that is actually charged. The market rate of premium reflects the risk borne by the guarantor, which in turn reflects the credit rating of the beneficiary and the value of the collateral, if any, that […]

Being a competitor of the aid recipient is not enough. The competitor must show that it is directly and individually affected by the aid. Or, the competitor must show that it is directly affected by the Commission decision and that the decision leaves no discretion to the Member State concerned on how to comply with it. Introduction This article reviews […]

• In 2024, the total non-crisis state aid granted by Member States reached EUR 152 billion, an increase of 11% over the previous year. • The three most important policy objectives were environmental protection & energy savings, research and regional development. • The General Block Exemption Regulation was the basis for about 3200 measures delivering EUR 60.1 billion of aid. […]

Introduction Before any state aid granted, the granting authority must establish at a bare minimum that the application satisfies the formal incentive effect: that the project has not already started. The start of works is normally signified by the start of construction or the order of equipment or any other decision that indicates the commitment of the aid applicant to […]

Introduction  The past three articles have dealt with cases where the Commission or an EU court concluded that they were free of state aid or there were doubts as to whether they constituted state aid.  Today’s article reviews another case concerning a state intervention that was free of state aid. In decision SA.100862, the Commission found that transfer of state assets to a Finnish undertaking did not confer an advantage […]

Introduction  There are many cases where recipients of public subsidies perform non-economic activities and, therefore, those subsidies do not constitute state aid in the meaning of Article 107(1) TFEU. By contrast, there are only a handful of cases where activities that are normally economic in nature become non-economic because they are inextricably linked to a function reserved for the state or the […]