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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30. June 2022  |   Guest State Aid Blog by Lexxion Publisher

Further Views on Editorial by Andreas Bartosch (EStAL 1/2022, 1)
State Aid Blogs - Guest posts 3
Reading the Editorial by Andreas Bartosch (EStAL 1/2022, 1), I feel tempted – not to worship Satan or the GBER, but to add some more colours to the picture drawn up by the esteemed colleague. It is true that the Block Exemption Regulations were intended to save the Commission Services from „lästigem Alltagsgerümpel“ (“boring routine rubbish”, as Andreas Bartosch dubbed […]
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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?
State Aid Blogs - State Aid Uncovered SM posts 13
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
State Aid Blogs - State Aid Uncovered SM posts 12
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
State Aid Blogs - State Aid Uncovered SM posts 11
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
State Aid Blogs - State Aid Uncovered SM posts 10
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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31. May 2022  |   State Aid Uncovered by Phedon Nicolaides

State Aid and Anti-Competitive Practices
State Aid Blogs - State Aid Uncovered SM posts 9
State aid to undertakings that engage in anti-competitive practices is incompatible with the internal market. Introduction For State aid to be compatible with the internal market, it may not infringe any other provision of the Treaty or secondary legislation. Occasionally, the Commission finds State aid measures to be incompatible with the internal market because they contain clauses that exclude foreign […]
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27. May 2022  |   Guest State Aid Blog by Lexxion Publisher

How to approach the risk of carbon lock-in effects in state aid analysis?
State Aid Blogs - State Aid Uncovered SM posts 8
A recent FSR Debate[1] held on 4 May examined the key question of how policymakers and regulators can avoid carbon lock-in jeopardising the attainment of the European Union’s ambitious energy and climate targets. Carbon lock-in refers to situations where emissions-intensive energy assets continue to be used even when low-carbon and socially more beneficial assets are available.  This is a controversial […]
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24. May 2022  |   State Aid Uncovered by Phedon Nicolaides

Another Case of Rescue Aid to an Airline
State Aid Blogs - State Aid Uncovered SM posts 6
An undertaking does not have to be nationally “important” in order to qualify for rescue aid. Introduction The pandemic has been hard on airlines. For some of them, however, the pandemic simply exacerbated their already existing problems. On 18 May 2022, in case T‑577/20, Ryanair v European Commission, the General Court had to examine the case of State aid to […]
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17. May 2022  |   by Phedon Nicolaides

Rescue Aid
State Aid Blogs - State Aid Uncovered SM posts 1
Member State must demonstrate that rescue or restructuring aid aims to prevent social hardship or address market failure. The Temporary Framework is coming to an end The European Commission announced on 12 May 2022 that the Temporary Framework will be abolished on 30 June 2022, with the exception of the two types of support that were inserted in the Temporary […]
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10. May 2022  |   State Aid Uncovered by Phedon Nicolaides

Risk Finance
State Aid Blogs - State Aid Uncovered SM posts 5
Risk finance aid in the form of tax relief based on the GBER must be limited to private investors. Introduction Decisions of the European Commission authorising aid for risk finance are very rare. This is the consequence of the success of the Commission to get Member States to use almost exclusively the General Block Exemption Regulation [GBER] for the design […]
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1. February 2022  |   State Aid Uncovered by Phedon Nicolaides

I. The Commission Need not Always Open the Formal Investigation Procedure before Correcting a Faulty Decision II. Fines for Failure to Recover Incompatible Aid
State Aid Blogs - WhatsApp Image 2022 01 31 at 15.42.44
The formal investigation procedure need not be re-opened when the fault lies in the legal assessment of the measure in question. Incompatible State aid has to be recovered quickly and effectively, even from insolvent undertakings. Introduction This article examines two recent judgments concerning Greece. The first judgment explains when the Commission does not have to re-open the formal investigation procedure […]
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25. January 2022  |   State Aid Uncovered by Phedon Nicolaides

Duplication of Infrastructure Does not Promote Regional Development
State Aid Blogs - Social Media posts 6
A private investor is not interested in regional development. A private investor recoups its investment in infrastructure from revenue from the operation of that infrastructure. Duplication of infrastructure does not contribute to regional development. Introduction In 2015 the European Commission caused a buzz in the State aid community when it decided that investment aid granted to a small Polish airport […]
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18. January 2022  |   State Aid Uncovered by Phedon Nicolaides

A Non-Selective Financial Tax with a Narrow Scope
State Aid Blogs - Social Media posts 3
The scope of a tax must be objectively defined in order for those excluded from the tax not to benefit from a selective advantage. Introduction Taxes are burdens, so they fall outside the scope of Article 107(1) TFEU which prohibits selective benefits funded with state resources. Normally, Article 107(1) applies to benefits from tax exemptions or tax derogations which result […]
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11. January 2022  |   State Aid Uncovered by Phedon Nicolaides

Private Creditor and the Ability of the Debtor to Repay
State Aid Blogs - Social Media posts 1
There are no rules as to the promptness with which a private creditor must act in order to enforce its claims. However, a hypothetical private creditor need not demand that a debtor be declared insolvent as soon as it fails, without taking any account of its longer-term potential. Introduction When the state accepts to restructure debt owed to it or […]
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4. January 2022  |   State Aid Uncovered by Phedon Nicolaides

Public Funding of an Energy Infrastructure Project
State Aid Blogs - Social Media posts 2
State aid up to 100% of the funding gap of a project can be compatible with the internal market. Introduction The European Commission approved investment aid for a Liquefied Natural Gas [LNG] terminal in Alexandroupolis in northern Greece [case SA.55526]. The project involves the following: A Floating Storage Regasification Unit [FSRU] for the storage and regasification of LNG. The construction […]
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28. December 2021  |   State Aid Uncovered by Phedon Nicolaides

Illegal Aid Cannot be Regularised a Posteriori
A Commission decision finding non-notified aid to be compatible with the internal market cannot remedy the illegality that existed before the Commission decision. Introduction In November 2021, the General Court rejected an appeal by the recipient of illegal aid who had asked the Commission to declare the aid compatible with the internal market even though the Member State concerned had […]
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21. December 2021  |   State Aid Uncovered by Phedon Nicolaides

How to Determine Selectivity
State Aid Blogs - Social Media posts
A measure is selective when it excludes undertakings that are equally capable of contributing to the achievement of its objectives. Introduction Since no two undertakings are exactly the same, how can it be determined whether they are in a comparable situation? Differences in their features such as size or the type of technology they use do not necessarily mean that […]
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14. December 2021  |   State Aid Uncovered by Phedon Nicolaides

First Case of a “Private Debtor” Test?
State Aid Blogs - Blog 51 KV
A public authority acting as a “private debtor” tries to minimise the amount that it has to pay. Introduction In assessing whether commercial transactions between public authorities and undertakings are free of State aid, the European Commission and EU courts apply the market economy investor principle [MEIP]. In essence, this principle tests whether a public investor behaves like a private […]
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7. December 2021  |   State Aid Uncovered by Phedon Nicolaides

An Unusual Case of a “Self Notification” of State Aid by an Aid Beneficiary
State Aid Blogs - Blog 50 KV
Aid beneficiaries may not “notify” State aid to the Commission. Only Member States may notify aid. Beneficiaries of non-notified aid may ask national courts to penalise the granting authorities. Introduction What should an undertaking do when it finds out that a public measure from which it has been benefitting contains State aid that has not been notified to the European […]
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30. November 2021  |   State Aid Uncovered by Phedon Nicolaides

When Does an Amendment of an Existing Aid Make it a New Aid?
State Aid Blogs - Blog KV 49
Existing aid becomes new aid if any amendment affects the assessment of its compatibility with the internal market. Introduction Member States often amend and adjust State aid measures after they are approved by the Commission. Such changes must be carried carefully because they can turn an existing aid into new aid and all new aid has to be notified to […]
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