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.
The objective of common interest that should be supported by State aid does not have to be an objective agreed by all Member States. Environmental protection Austria argued that the Commission had ignored the potential negative effects of the aid on the environment such as the storing of nuclear waste. The reply of the Court was that “(516) in […]
The objective of common interest that should be supported by state aid does not have to be an objective agreed by all Member States. Existence of market failure and need for aid Austria and Luxembourg claimed that the intervention by the UK was not necessary and that there was no evidence that the liberalised market for the generation and […]
The objective of common interest that should be supported by state aid does not have to be an objective agreed by all Member States. Introduction On 12 July 2018, the General Court ruled in a complex case brought by Austria and Luxembourg against Commission decision 2015/658 which had authorised State aid for Hinkley Point C, a new nuclear power […]
A tax measure may be selective in relation to both intermediate and final beneficiaries. An undertaking may enjoy a selective advantage even if it passes all tax benefits to other parties. Introduction A measure that is not selective at one level may be selective at another level and a measure that is selective at one level can also be […]
State aid does not have to be awarded on the basis of a competitive procedure, unless the relevant rules require it. Secondary legislation may allow Member States to make direct awards without a prior competitive procedure. Public procurement rules do not apply to awards between contracting authorities. Introduction Public procurement and State aid rules have the same basic […]
Compensation for the provision of public services may not exceed the avoidable cost minus any forgone revenue from not having to provide those services. The VAT exemption for postal services is not State aid because it is laid down in the EU VAT directive and therefore cannot be attributed to Member States. Introduction This article reviews Commission decision on […]
Closer cooperation between Commission services and Member States. Introduction The European Commission, DG Competition, published on 16 July 2018 on its website and then on 19 July 2018 in the Official Journal of the EU a Code of Best Practices for the Conduct of State Aid Control Procedures.[1]The purpose of the Code is to provide guidance to Member […]
After its withdrawal from the EU, the UK is likely to maintain a State aid regime that is similar to that of the EU. Introduction In seven months’ time, on 29 March 2019, the UK will leave the EU. But its withdrawal from the EU will not bring to an end compliance with EU rules. The UK is […]
Failure to comply with just a single provision of an exemption regulation results in the non-applicability of the whole regulation and makes any implemented aid measure automatically illegal. The compatibility of aid measures adopted in the past but continuing having effects are assessed not on the basis of old rules but on the basis of the rules which are applicable […]
A selective measure should be determined on the basis of its effects, not on the basis of the legally defined regulatory techniques. Introduction A tax measure is selective in the meaning of Article 107(1) TFEU when it basically deviates from the normal tax system. In the case of a tax reduction or a tax exemption the normal system is […]
To determine whether a measure is selective it is necessary to compare the beneficiary companies to other companies which are in a similar situation and determine whether the latter receive the same advantage. Introduction[1] On 20 December 2017, the Court of Justice delivered three judgments in appeals against rulings of the General Court concerning the expansion of digital terrestrial television […]
Aid that seeks to neutralise a structural disadvantage still confers an advantage. Aid that seeks to remedy market failure is selective. State aid that is compatible with the internal market must be necessary to achieve an objective of the Treaty and be capable of incentivising a change in the behaviour of the recipient undertakings. Introduction On 13 December 2017, […]
When Member States act as regulators they need not maximise revenue from the granting of concessions rights. When Member States act as regulators they must grant concession rights on the basis of procedures which are competitive, transparent, non-discriminatory and unconditional. Part II: Public procurement principles[1] Principles for selection of concession holders The Commission examined also, in addition to the […]
When Member States act as regulators they need not maximise revenue from the granting of concessions rights. When Member States act as regulators they must grant concession rights on the basis of procedures which are competitive, transparent, non-discriminatory and unconditional. Introduction Is it possible for a public authority to grant State aid through a defective procurement procedure? The answer […]
Questions around grants for R&D&I projects, economic activities of religious establishments or concession agreements besides many more, have moved and shaped this year’s judgments on State aid. Also Brexit and its meaning for State aid control in the UK has been on everyone’s mind. See which articles by Prof. Phedon Nicolaides were the most popular ones in 2017. We have […]
State aid has a purely local impact when i) the beneficiaries supply goods or services to a limited area within a Member State, ii) they are unlikely to attract customers from other Member States and iii) there is no inducement for cross-border investment or establishment. Introduction The article this week continues with the theme of affectation of trade that […]
Article 107(1) requires the assessment of both the direct and indirect impact of a public measure on cross-border trade. The direct impact is the effect on the cross-border movement of products or customers of the aid recipient or of its competitors. The indirect impact is the effect on the cross-border movement of the aid recipient itself or its competitors. […]
The fact that the state owns an undertaking is not enough to prove that the decisions of that undertaking can be attributed to the state. However, it is sufficient that the state was involved in the particular decision that transferred state resources for the benefit of another undertaking. Introduction Several recent articles on this blog have examined the concept […]
The European Commission may withdraw a decision, but before it adopts a new decision it must give an opportunity to interested parties to submit their comments, especially, if it changes the legal basis of the assessment of the compatibility of the aid. Introduction The most frequent reasons for which the Commission finds aid to be incompatible with the internal […]
Private resources that come under the control of a public authority become state resources. The only defence for not recovering incompatible aid is absolute impossibility. Agricultural policy objectives take precedence over those of competition policy. Introduction This article reviews a case involving transfer of state resources and a case concerning failure to recovery of incompatible State aid. It also draws […]
