State Aid Uncovered Blog

As long as the compensation does not exceed the net extra costs of the universal service activities, it may be used to offset other costs. Introduction The rules on State aid for services of general economic interest [SGEI] are very generous because they allow both investment and operating aid. Yet, it is not easy to comply with those rules because […]

State aid that is necessary for protecting essential national interests can be compatible with the internal market. Introduction State aid should support outcomes that the market by itself cannot achieve. This implies that State aid that is restricted to only one or a few undertakings is unlikely to be capable of delivering the desired outcome. Yet, sometimes there may be […]

A tax that is levied on both imported and domestic products but its revenue finances only domestic products infringes fundamental provisions of the EU Treaty. Introduction Member States finance the generation of electricity from renewable energy sources [RES] with revenue they raise through levies or charges on consumers of electricity. On 14 April 2021, the General Court in judgment in […]

Progressive rates can be part of a reference tax system. The reference tax system is, in principle, made up of the tax base, the tax rates and the taxable events. Introduction Progressive turnover taxes were thought to be selective because they are levied on gross revenue before costs are deducted and larger volumes of revenue are taxed at higher rates. […]

Aid to remedy a serious economic disturbance may be granted to a single company that is important for the national economy. EU law does not extend to competitors a right to the same aid. Introduction Between March 2020 and April 2021, the European Commission has authorised aid totalling more than EUR 2.5 trillion to remedy the serious economic disturbance caused […]

The new RDI Framework provides continuity with clarity. On Monday, 19 April 2021, the European Commission published the new Regional Aid Guidelines for the period 2022-2027. They can be accessed at: https://ec.europa.eu/competition/state_aid/regional_aid/RAG_2021_adopted_communication.zip Introduction On 8 April 2021, the European Commission published the text of the draft new RDI Framework and launched public consultation.[1] The draft RDI Framework is accompanied by […]

A state guarantee can bridge the funding gap of an infrastructure project. Introduction State aid rules allow energy infrastructure projects to be supported by as much aid as is necessary to bridge their “funding gap”; i.e. the difference between the initial investment cost and the present value of their expected net operating revenue which is the future gross revenue minus […]

Vague award criteria can be discriminatory and harm the transparency of the selection procedure. Introduction After receiving a complaint, the Commission opened a formal investigation into alleged State aid granted by the Estonian Ministry of Rural Affairs to AS Tartu Agro, a private limited company, which produced milk, meat and cereals. According to the complaint, the Ministry had granted unlawful […]

It is incumbent on the Commission to carry out a global assessment of tax schemes. But it must take into account only those provisions of schemes that apply ex ante and do not depend on the circumstances of individual tax payers. Only when aid has to be recovered must the provisions that apply to the specific circumstances of individual tax […]

Exclusive rights may constitute State aid if they mandate payments with resources over which the state can exercise control. Compensation for the cost of public service obligations may be granted only if the obligations are clear and define a service that is different from market services. Introduction Article 106(1) TFEU requires Member States not to distort competition when they grant […]