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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Guest State Aid Blog ×

The Extent of the Discretion of Member States to Define Services of General Economic Interest (SGEI)

A service is classified as an SGEI not only when it is important for citizens but also when the market does not adequately supply it and one or more undertakings are compelled to provide it to specified consumers, in specified areas and on specified terms.   Introduction   The Treaty on the Functioning of the EU and the case law […]

Activities Linked to State Prerogatives

Economic activities which cannot be separated from the exercise of public powers cease to be economic in nature.   Introduction The dividing line between economic and non-economic activities is in a permanent state of flux. Although it is now clear that some activities fall within the powers and prerogatives of the state, while many others are carried out by the […]

The Scope of Public Service Obligations

Public service obligations may cover both profitable and unprofitable segments of the market.   Introduction 18 January 2017, the General Court delivered its judgment in case T-92/11 RENV, Jørgen Andersen, v European Commission.[1] Mr Andersen appealed against Commission Decision 2011/3 which concluded that public service contracts between the Danish Ministry of Transport and Danske Statsbaner [DSB], the incumbent train operator, contained […]

PART II: Combining Infrastructure Aid with SGEI Aid

After the spontaneous words on Brexit and State aid last week, I continue with the 2nd part of the post on infrastructure and SGEI today. A provider of services of general economic interest may receive both investment aid and compensation for the extra costs of public service obligations.   Part II: SGEI[1] Member States are free to determine the services […]

PART II: Regional Development and i) Market Economy Operator Test ii) Services of General Economic Interest

A market economy operator undertakes activities whose incremental revenue exceeds their incremental costs. A market economy operator ignores costs which are unaffected by those activities. A service of general economic interest has special characteristics that set it apart from other services with positive impact on the economy. Having a positive impact is not enough.   Part II: Public tasks and […]

PART I: Regional Development and i) Market Economy Operator Test, ii) Services of General Economic Interest

A market economy operator undertakes activities whose incremental revenue exceeds their incremental costs. A market economy operator ignores costs which are unaffected by those activities. A service of general economic interest has special characteristics that set it apart from other services with positive impact on the economy. Having a positive impact is not enough.   Introduction National and regional authorities […]

Services of General Economic Interest: How to Compensate and Induce more Efficiency

Even traditional monopolists, like postal operators, have to comply with the rules on compensation for the extra costs of public service obligations. SGEI providers can be compensated in a way that induces them to become more efficient.   Introduction This article examines case Commission decision SA.38788 concerning compensation for the UK Post Office Ltd [POL] in the period 2015-18.[1] It is […]

Failure to Satisfy Ex Post the Altmark Criteria, but Compliance with the 2014 Aviation Guidelines

Public service obligations must be entrusted by an official act and defined with sufficient precision. Imprecise definition of public service obligations makes it impossible to identify the costs which are caused by such obligations. Consequently, imprecise definition of public service obligations makes it impossible to grant compensation because subsidisation of non-eligible costs cannot be excluded. Compensation may not be granted […]

Guest State Aid Blog ×

The Extent of the Discretion of Member States to Define Services of General Economic Interest (SGEI)

A service is classified as an SGEI not only when it is important for citizens but also when the market does not adequately supply it and one or more undertakings are compelled to provide it to specified consumers, in specified areas and on specified terms.   Introduction   The Treaty on the Functioning of the EU and the case law […]

Activities Linked to State Prerogatives

Economic activities which cannot be separated from the exercise of public powers cease to be economic in nature.   Introduction The dividing line between economic and non-economic activities is in a permanent state of flux. Although it is now clear that some activities fall within the powers and prerogatives of the state, while many others are carried out by the […]

The Scope of Public Service Obligations

Public service obligations may cover both profitable and unprofitable segments of the market.   Introduction 18 January 2017, the General Court delivered its judgment in case T-92/11 RENV, Jørgen Andersen, v European Commission.[1] Mr Andersen appealed against Commission Decision 2011/3 which concluded that public service contracts between the Danish Ministry of Transport and Danske Statsbaner [DSB], the incumbent train operator, contained […]

PART II: Combining Infrastructure Aid with SGEI Aid

After the spontaneous words on Brexit and State aid last week, I continue with the 2nd part of the post on infrastructure and SGEI today. A provider of services of general economic interest may receive both investment aid and compensation for the extra costs of public service obligations.   Part II: SGEI[1] Member States are free to determine the services […]

PART II: Regional Development and i) Market Economy Operator Test ii) Services of General Economic Interest

A market economy operator undertakes activities whose incremental revenue exceeds their incremental costs. A market economy operator ignores costs which are unaffected by those activities. A service of general economic interest has special characteristics that set it apart from other services with positive impact on the economy. Having a positive impact is not enough.   Part II: Public tasks and […]

PART I: Regional Development and i) Market Economy Operator Test, ii) Services of General Economic Interest

A market economy operator undertakes activities whose incremental revenue exceeds their incremental costs. A market economy operator ignores costs which are unaffected by those activities. A service of general economic interest has special characteristics that set it apart from other services with positive impact on the economy. Having a positive impact is not enough.   Introduction National and regional authorities […]

Services of General Economic Interest: How to Compensate and Induce more Efficiency

Even traditional monopolists, like postal operators, have to comply with the rules on compensation for the extra costs of public service obligations. SGEI providers can be compensated in a way that induces them to become more efficient.   Introduction This article examines case Commission decision SA.38788 concerning compensation for the UK Post Office Ltd [POL] in the period 2015-18.[1] It is […]

Failure to Satisfy Ex Post the Altmark Criteria, but Compliance with the 2014 Aviation Guidelines

Public service obligations must be entrusted by an official act and defined with sufficient precision. Imprecise definition of public service obligations makes it impossible to identify the costs which are caused by such obligations. Consequently, imprecise definition of public service obligations makes it impossible to grant compensation because subsidisation of non-eligible costs cannot be excluded. Compensation may not be granted […]

Guest State Aid Blog ×

The Extent of the Discretion of Member States to Define Services of General Economic Interest (SGEI)

A service is classified as an SGEI not only when it is important for citizens but also when the market does not adequately supply it and one or more undertakings are compelled to provide it to specified consumers, in specified areas and on specified terms.   Introduction   The Treaty on the Functioning of the EU and the case law […]

Activities Linked to State Prerogatives

Economic activities which cannot be separated from the exercise of public powers cease to be economic in nature.   Introduction The dividing line between economic and non-economic activities is in a permanent state of flux. Although it is now clear that some activities fall within the powers and prerogatives of the state, while many others are carried out by the […]

The Scope of Public Service Obligations

Public service obligations may cover both profitable and unprofitable segments of the market.   Introduction 18 January 2017, the General Court delivered its judgment in case T-92/11 RENV, Jørgen Andersen, v European Commission.[1] Mr Andersen appealed against Commission Decision 2011/3 which concluded that public service contracts between the Danish Ministry of Transport and Danske Statsbaner [DSB], the incumbent train operator, contained […]

PART II: Combining Infrastructure Aid with SGEI Aid

After the spontaneous words on Brexit and State aid last week, I continue with the 2nd part of the post on infrastructure and SGEI today. A provider of services of general economic interest may receive both investment aid and compensation for the extra costs of public service obligations.   Part II: SGEI[1] Member States are free to determine the services […]

PART II: Regional Development and i) Market Economy Operator Test ii) Services of General Economic Interest

A market economy operator undertakes activities whose incremental revenue exceeds their incremental costs. A market economy operator ignores costs which are unaffected by those activities. A service of general economic interest has special characteristics that set it apart from other services with positive impact on the economy. Having a positive impact is not enough.   Part II: Public tasks and […]

PART I: Regional Development and i) Market Economy Operator Test, ii) Services of General Economic Interest

A market economy operator undertakes activities whose incremental revenue exceeds their incremental costs. A market economy operator ignores costs which are unaffected by those activities. A service of general economic interest has special characteristics that set it apart from other services with positive impact on the economy. Having a positive impact is not enough.   Introduction National and regional authorities […]

Services of General Economic Interest: How to Compensate and Induce more Efficiency

Even traditional monopolists, like postal operators, have to comply with the rules on compensation for the extra costs of public service obligations. SGEI providers can be compensated in a way that induces them to become more efficient.   Introduction This article examines case Commission decision SA.38788 concerning compensation for the UK Post Office Ltd [POL] in the period 2015-18.[1] It is […]

Failure to Satisfy Ex Post the Altmark Criteria, but Compliance with the 2014 Aviation Guidelines

Public service obligations must be entrusted by an official act and defined with sufficient precision. Imprecise definition of public service obligations makes it impossible to identify the costs which are caused by such obligations. Consequently, imprecise definition of public service obligations makes it impossible to grant compensation because subsidisation of non-eligible costs cannot be excluded. Compensation may not be granted […]

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