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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18. July 2023  |   State Aid Uncovered by Phedon Nicolaides

The Non-economic Nature of a Public Health System and Regional Development
State Aid Blogs - State Aid Uncovered SM posts 44
Introduction This article reviews two judgments: On a public health system and on regional development through capital injections. I. Public health system On 27 April 2023, the Court of Justice rendered its judgment in case C-492/21 P, Casa Regina Apostolorum della Pia Società delle Figlie di San Paolo v European Commission.[1] Casa Regina Apostolorum della Pia Società delle Figlie di […]
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10. July 2023  |   State Aid Uncovered by Phedon Nicolaides

Regional Operating Aid
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Introduction On 21 June 2023, the General Court delivered its judgment in case T-131/21, Região Autónoma da Madeira v European Commission.[1] It rejected the action of the Autonomous Region of Madeira [ARM] by which it sought the annulment of Commission decision 2022/1414 on aid scheme implemented by Portugal for the Madeira Free Zone or Zona Franca da Madeira [ZFM]. The […]
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3. July 2023  |   State Aid Uncovered by Phedon Nicolaides

Transactions at Market Rates Can still Confer an Advantage that Constitutes State aid (PART II)
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Introduction When public authorities buy goods and services for themselves, they have to pay a market price, otherwise they confer an abnormal advantage to the sellers. On 14 June 2023, the General Court, in case T‑79/21, Ryanair & Airport Marketing Services v European Commission, ruled that public authorities still confer an abnormal advantage by buying good and services that they […]
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27. June 2023  |   State Aid Uncovered by Phedon Nicolaides

Transactions at Market Rates Can still Confer an Advantage that Constitutes State aid (PART I)
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Introduction When public authorities buy goods and services for themselves, they have to pay a market price, otherwise they confer an abnormal advantage to the sellers. On 14 June 2023, the General Court, in case T-79/21, Ryanair & Airport Marketing Services v European Commission, ruled that public authorities still confer an abnormal advantage by buying good and services that they […]
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20. June 2023  |   State Aid Uncovered by Phedon Nicolaides

Regulatory Measures Are not State aid & Trade Unions Are not “Interested Party”
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Introduction This article reviews two recent judgments dealing with the concept of state resources and the meaning of “interested party”, respectively. State resources On 8 June 2023, the Court of Justice clarified, by its judgment in case C-50/21, Prestige and Limousine SL, that purely regulatory measures may confer and advantage without, however, granting State aid.1 The Court was responding to […]
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13. June 2023  |   State Aid Uncovered by Phedon Nicolaides

How the Infringement of Non-State aid Rules Can Affect the Compatibility of State aid
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Introduction  It is now well-established that if a State aid measure is inherently or indissolubly linked to a an infringement of EU law outside the field of State aid it cannot be found to be compatible with the internal market.  As a result of the judgment of the General Court on 24 May 2023, in case T-268/21, Ryanair v European […]
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6. June 2023  |   State Aid Uncovered by Phedon Nicolaides

A First Case of “Significant Market Power”
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Introduction On the same day that the General Court ruled on the recapitalisation of SAS, it also ruled on the recapitalisation of Lufthansa in case T-34/21, Ryanair v European Commission.1 In the latter case, Ryanair sought the annulment of Commission decision SA.57153 of June 2020 by which the Commission approved injection of capital in Deutsche Lufthansa [DLH] of the amount […]
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30. May 2023  |   State Aid Uncovered by Phedon Nicolaides

The 2020 Temporary State aid Framework and Recapitalisation of Undertakings
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Introduction Ryanair has challenged many Commission decisions authorising State aid for its rivals. In 2021 and 2022, the General Court delivered 12 judgments concerning covid-19-related aid granted to other airlines. Of those 12 judgments, Ryanair temporarily won only three. Its wins were transient because the General Court suspended the annulment of the relevant Commission decisions, on the grounds that the […]
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23. May 2023  |   State Aid Uncovered by Phedon Nicolaides

The Temporary Framework Allows Member States to Grant Aid only to SMEs 
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Introduction  Although discrimination is in general prohibited in the EU, the fact remains that in the field of State aid Member States may grant State aid only to certain companies and may also decide how much aid to grant.  That the granting of State aid relies solely on the discretion of Member States has recently been re-confirmed by the General […]
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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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16. August 2022  |   State Aid Uncovered by Phedon Nicolaides

Compensation for the Net Cost of Public Service Obligations (Part I)
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Public service obligations must be imposed through an act of entrustment that defines clearly the terms of the service and the duration of the obligation. The “reasonable profit” in the public service compensation should reflect the risk borne by the provider. Introduction In 2009, the Commission received several complaints concerning State aid that Italy had granted to the various shipping […]
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9. August 2022  |   State Aid Uncovered by Phedon Nicolaides

Legal Standing of Competitors
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A Commission decision authorising or prohibiting a state aid measure that can be implemented without any intermediate rules is a “regulatory act” that can be challenged by “directly concerned” undertakings. Introduction Any natural or legal person who is the addressee of an act of an EU institution can challenge that act before EU courts. This is a right that is […]
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26. July 2022  |   State Aid Uncovered by Phedon Nicolaides

Economic Activities of a Research Organisation (Part I)
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The revenue from the economic activities of a research organisation must cover the full cost of those activities. Introduction Member States use extensively the GBER to support R&D schemes. If we exclude the measures that were implemented in the context of covid-19 and now those which are financed by the recovery and resilience fund, not more than a dozen measures […]
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19. July 2022  |   State Aid Uncovered by Phedon Nicolaides

The State Behaving Like a Private Land Owner
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A private land owner changes rent at market rates. But it may accept lower rent if the user of the land incurs costs to improve it. Comparative analysis to determine the market value of land must take into account not only the particularities of the various land plots, but also the particularities of the various rental contracts. Introduction When the […]
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12. July 2022  |   State Aid Uncovered by Phedon Nicolaides

State Guarantees without State Aid
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Introduction State guarantees may constitute State aid if they are not priced at market rates. A properly priced guarantee reflects the risk assumed by the public authority that issues it and the collateral, if any, that the beneficiary undertaking can pledge. The State aid that is embedded in a guarantee that is priced below the relevant market rate is operating […]
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5. July 2022  |   State Aid Uncovered by Phedon Nicolaides

Why Grant a Loan to an Undertaking in Difficulty?
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When a market operator invests in an undertaking in difficulty it also considers the possibility of restructuring, sale or closure. Introduction The answer to the question posed in the title of this article is “because the loan enables the undertaking to become viable again and repay the loan with interest”. It is now well established in the case law that […]
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28. June 2022  |   State Aid Uncovered by Phedon Nicolaides

Individual Aid to Counter the Effects of Serious Economic Disturbance Is Legally Possible, but Is it Appropriate?
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Individual aid need not be capable itself to remedy serious economic disturbance in the economy of a Member State. It is sufficient that it contributes to that effect. Introduction On 22 June 2022, in case T‑657/20, Ryanair v European Commission, the General Court confirmed once more that Member States have a right to grant State aid to the undertakings of […]
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21. June 2022  |   State Aid Uncovered by Phedon Nicolaides

The Date on which State Aid is Deemed to be Granted Is not necessarily the Date on which the Actual Benefit Materialises
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State aid is deemed to be granted even if the benefit cannot be quantified in advance and even if state resources are transferred at a future point in time. Introduction The precise date on which State aid is granted can be important such as, for example, when calculating the present value of aid granted in tranches at different points in […]
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14. June 2022  |   State Aid Uncovered by Phedon Nicolaides

Territoriality and the Tax Treatment of Intra-group Transactions
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A special tax rule can constitute the reference or normal system of taxation if it is “severable” from other tax rules and has its own legal logic. Introduction The application of State aid rules to the tax treatment of transactions between companies that belong to the same multinational group is contentious. During the past three years or so, the Commission […]
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7. June 2022  |   State Aid Uncovered by Phedon Nicolaides

A Rare Commission Decision on SGEI Interpreting Decision 2012/21
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A non-profit provider of free services which are in competition with similar services on the market is an undertaking. Introduction The decentralisation of State aid policy of the past decade has made it easier for the Member States to achieve their public policy objectives. By using blog exemption regulations and decisions, they can grant State aid faster, without having to […]
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