State Aid Law Blog

State Aid Uncovered Blog

In Lexxion’s State Aid Uncovered blog, Prof. Phedon Nicolaides publishes weekly critical analyses of recent State aid judgments and decisions. Each post presents the key points of a court judgment or EU Commission decision, places it in the context of similar case law or practice, assesses the underlying reasoning and highlights any inconsistencies or contradictions.

Guest contributions from other State aid experts will also be published on the blog at irregular intervals to complement the content of the blog posts.

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16. November 2023  |   Guest State Aid Blog by Michał Bernat

The Interplay of R&D Works and Formal Incentive Effect Rules
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The Interplay of R&D Works and Formal Incentive Effect Rules Michał Bernat.1 The issue mentioned in the title appears at first sight rather uncontroversial, as it is instinctively understood that research and development (R&D) works do not form part of an investment towards which they are directed, but this brief note raises certain issues arising in that respect which have […]
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14. November 2023  |   State Aid Uncovered by Phedon Nicolaides

Start of Works
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Introduction Perhaps the most important criterion for the compatibility of State aid with the internal market is the incentive effect. This means that State aid is capable of changing the behaviour of the recipient undertaking. State aid is normally considered not to have an incentive effect when the recipient undertaking is already committed to launch a project or has already […]
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7. November 2023  |   State Aid Uncovered by Phedon Nicolaides

Whether a Tax Measure Grants New Aid Must also be Assessed in the Context of the Relevant National Case Law
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Introduction The application of the concept of selectivity to tax measures requires a comparison of undertakings or activities that are in a similar factual or legal situation. A tax measure that differentiates between similar undertakings or activities is selective in the meaning of Article 107(1) TFEU, unless the differentiation can be justified on objective reasons. It follows that the proper […]
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31. October 2023  |   State Aid Uncovered by Phedon Nicolaides

A Complex Measure of Investment and Operating Aid to an Airport and Airlines (Part II)
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Introduction In July 2008, the Commission received complaints alleging that France granted State aid to the operator of La Rochelle airport and certain airlines. Almost four years later, in February 2012, the Commission decided to open the formal investigation procedure. It eventually adopted a decision in July 2022 [Commission decision 2023/1683] which found compatible State aid for the airport, incompatible […]
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24. October 2023  |   State Aid Uncovered by Phedon Nicolaides

A Complex Measure of Investment and Operating Aid to an Airport and Airlines (Part I)
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Introduction In July 2008, the Commission received complaints alleging that France granted State aid to the operator of La Rochelle airport and certain airlines. Almost four years later, in February 2012, the Commission decided to open the formal investigation procedure. It eventually adopted a decision in July 2022 [Commission decision 2023/1683] which found compatible State aid for the airport, incompatible […]
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17. October 2023  |   State Aid Uncovered by Phedon Nicolaides

Compensation for Damage
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Introduction On 28 September 2023, the Court of Justice, in case C-320/21 P, Ryanair v European Commission, delivered its first judgment in a series of appeals brought by Ryanair challenging the dismissal by the General Court of its action in multiple cases seeking the annulment of various Commission decisions authorising aid to airlines during the covid-19 pandemic. Both before the […]
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10. October 2023  |   State Aid Uncovered by Phedon Nicolaides

Advance Tax Rulings
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Introduction In 2016, the Commission found, in decision 2016/1699, that advance tax rulings [ATRs] that had been provided by Belgium to multi-national companies [MNCs] with establishments in Belgium constituted State aid because the ATRs set the taxable income of those companies according to a hypothetical average income rather than their actual income. The profit that exceeded that hypothetical average was […]
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2. October 2023  |   State Aid Uncovered by Phedon Nicolaides

The Harm Caused by State aid and the Delineation of the Relevant Market
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Introduction A competitor of an aid recipient who wants to challenge a Commission decision authorising State aid must either show that the aid harms it directly and individually – i.e. its interests are seriously affected to a larger extent than anyone else – or that the Commission should have had doubts about the compatibility of the aid during the preliminary […]
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26. September 2023  |   State Aid Uncovered by Phedon Nicolaides

Non-imposition of Fines on Non-illegal Behaviour
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Introduction Advantage is any benefit that an undertaking obtains from the intervention of the state. In some situations, however, an undertaking may derive an advantage the non-intervention of the state or, more broadly, from the failure of the state to act. This would be the case where the state does not charge a fee to a user of a state […]
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19. September 2023  |   by Phedon Nicolaides

When Are Decisions of State-owned Companies Imputed to the State?
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Introduction According to Article 4 of Regulation 2015/1589 [the Procedural Regulation], when the Commission, after a preliminary examination of a State aid measure, has doubts as to the absence of State aid or the compatibility of the aid with the internal market, it must open the formal examination procedure. The case law says that doubts arise when the Commission encounters […]
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16. May 2023  |   State Aid Uncovered by Phedon Nicolaides

Support for the Decarbonisation of the Electricity Sector through Storage Capacity
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Introduction Romania notified a scheme to support investment in large-scale electricity storage. The Commission approved it in decision SA.102761.[1] The scheme was part of the national Recovery and Resilience Plan [RRP] of Romania and was co-financed by the EU’s Recovery and Resilience Facility. By supporting investment in electricity storage, Romania aimed to reduce carbon emissions generated by the energy sector, […]
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9. May 2023  |   State Aid Uncovered by Phedon Nicolaides

Development of Affordable Housing
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Introduction The provision of social housing can be designated as a service of general economic interest and can be publicly funded under the Commission decision 2021/21. Member States have to show that there is a real social need and limit access to social housing to those persons who cannot afford what the market provides; i.e. low-income or vulnerable persons such […]
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2. May 2023  |   State Aid Uncovered by Phedon Nicolaides

State aid Scoreboard, 2022
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Introduction On 24 April 2023, the Commission released the 2022 version of the State aid Scoreboard which this year runs to a record 226 pages.[1] It covers the State aid that was granted in 2021 and contains information on both covid-19 measures and non-pandemic aid. Covid-19 related aid reached EUR 191 billion, or 57% of total aid expenditure. Non-crisis aid […]
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25. April 2023  |   State Aid Uncovered by Phedon Nicolaides

German Risk Finance
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Introduction Relatively few risk finance measures are notified to the Commission as Member States use Articles 21 and 22 of the GBER to support investments in SMEs and start-ups. However, the GBER excludes from its scope tax incentives for investments by undertakings. Tax incentives are possible only for investments by private investors. For this reason, Germany recently notified an aid […]
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18. April 2023  |   State Aid Uncovered by Phedon Nicolaides

Imposition of Public Service Obligations through Extension of a Concession
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Introduction It has recently been confirmed in the case law that Member States are not obliged to implement a procurement procedure when they grant State aid. This means, of course, that the public funds they provide do confer an advantage on their recipient undertakings. Compliance with public procurement procedures affects the compatibility of the aid with the internal market. Indeed, […]
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11. April 2023  |   State Aid Uncovered by Phedon Nicolaides

Update of Commission Guiding Templates on Funding by the Recovery and Resilience Facility
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Introduction In December 2020, the European Commission published “templates” to help Member States in the design of their plans that were to be financed by the Recovery and Resilience Facility [RRF]. The purpose of the templates was to identify whether those plans contained State aid and, if they did, whether the aid had to be notified or not. Soon afterwards […]
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4. April 2023  |   State Aid Uncovered by Phedon Nicolaides

Compensation for Damage Caused by COVID-19 Combined with Rescue Aid
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Introduction Member States are allowed to grant state to compensate undertakings for damage they suffer as a result of a natural disaster or exceptional occurrence. But, it is not always easy or possible to disentangle the damage caused by such an unforeseen event from losses caused by mismanagement or changes of market conditions. The art and science of calculating the […]
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28. March 2023  |   State Aid Uncovered by Phedon Nicolaides

A More Comprehensive and Generous GBER
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Introduction In a Communication that was published on 9 March 2023, the Commission announced extensive amendments to the GBER.[1] A 100-page annex to the Communication provided the legal text of the draft regulation that would revise Regulation 651/2014.[2] The amendments aim to: Ensure consistency between the GBER and new State aid guidelines. Bring the GBER in line with the EU […]
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21. March 2023  |   State Aid Uncovered by Phedon Nicolaides

Charging Infrastructure for Electric Vehicles
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Introduction As part of the EU’s Green Deal and the transition to a greener and most sustainable economy, the European Commission’s guidelines on State aid for climate, environmental protection and energy [CEEAG] also allow public support for the construction of energy infrastructures. In a recent decision, the Commission approved a German State aid scheme [SA.104749] for high-power charging infrastructure for […]
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14. March 2023  |   State Aid Uncovered by Phedon Nicolaides

State Aid for the Resolution of a Polish bank
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Introduction Whenever a bank seeks State aid, it must be considered as “failing or likely to fail”. A failing bank must be liquidated or resolved. Resolution means that the critical functions of the bank are preserved while the rest are wound down. Critical functions are those that impact significantly the real economy such as deposits, loans to SMEs or payments. […]
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