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. August 2015  |   State Aid Uncovered by Phedon Nicolaides

Why Do some Member States Offer so much Fiscal Aid?
State Aid Blogs - StateaidHub blogpost11 Lexxion 2019 Tax Commission EU judgement
Member States differ significantly in their propensity to grant fiscal aid.   Introduction Interest in fiscal aid has been rekindled recently by two unrelated events. First, the Commission opened a number of investigations on the alleged special tax treatment accorded to multinational companies such as Apple and Starbucks. These investigations are believed to be almost completed and the Commission is […]
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11. August 2015  |   State Aid Uncovered by Phedon Nicolaides

Ex post Evaluation of State Aid Measures
State Aid Blogs - 21.11.State resources State control
Ex post evaluation is not just a “pillar” of State Aid Modernisation. It is also an indispensable tool for understanding the impact and effectiveness of State aid. State aid modernisation and decentralisation   One of the pillars of the Commission’s State Aid Modernisation initiative is the decentralisation of responsibility for the implementation of State aid measures. The decentralisation works by […]
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4. August 2015  |   State Aid Uncovered by Phedon Nicolaides

The Use and Abuse of De Minimis Aid & State Resources
State Aid Blogs - m 9 2
Individual awards of de minimis aid must remain below the relevant threshold as well as the sum of all individual awards in any three-year period. Aid measures which are funded by beneficiaries themselves are unlikely to constitute State aid.   Introduction This article reviews two cases that, among other things, deal with the use and abuse of de minimis aid […]
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28. July 2015  |   State Aid Uncovered by Phedon Nicolaides

The Market Economy Investor Principle Applies also to Avoidance of Losses
State Aid Blogs - m 11 2
A public authority can act as a private investor in paying to avoid costly contractual clauses. A public authority can act as a private investor in paying to bring forward future revenue. Introduction   When a market operator invests to make profit, its underlying logic is the same as when it pays to avoid losses. In both cases it is […]
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21. July 2015  |   State Aid Uncovered by Phedon Nicolaides

Application of the MEIP to Transactions between Parent and Subsidiary Companies
State Aid Blogs - m 1 4
The Market Economy Investor Principle also applies to transactions between related companies. A private investor enjoys a margin of discretion in deciding in favour or against an investment. However, despite that margin of discretion, a prudent private investor always carries out an assessment of the potential profitability of the investment before it commits any money.   Introduction When a public […]
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14. July 2015  |   State Aid Uncovered by Phedon Nicolaides

Using Loans to Grant De Minimis Aid and GBER Compatible Aid
State Aid Blogs - StateAidHub blogpost23
De minimis aid underpins “off-the-shelf” financial instruments which leverage private investment and at the same time ensure that all aid is passed on to the final beneficiary.   Introduction One of the most convenient aid instruments is de minimis aid. It can be used for any purpose [apart from promotion of exports or on condition that domestic products are favoured] […]
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7. July 2015  |   State Aid Uncovered by Phedon Nicolaides

Privatisation by Splitting the Assets
State Aid Blogs - m 12 2
The sale of a public undertaking [privatisation] needs to be preceded by independent valuation and be carried out on the basis of a competitive procedure. Certain guarantees may be provided to prospective buyers, if they could increase the sale price. The break-up of an undertaking and the disposal of the different parts through separate sales should be shown to generate […]
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2. July 2015  |   Guest State Aid Blog by Lexxion Publisher

Court’s Diary – July 2015
gavel
Any comments on #Stateaid? Get in touch: Stateaidhub[at]lexxion.de Wednesday 01/07/2015 Opinion in Case C-357/14 P Dunamenti Erőmű v Commission (Court of Justice – Third Chamber)   Thursday 02/07/2015 Judgment in Joined cases T-425/04 RENV France v Commission, T-444/04 RENV Orange v Commission (General Court – Sixth Chamber, Extended Composition)   Wednesday 08/07/2015 Hearing in Case T-287/11 Heitkamp BauHolding v Commission (General Court – Ninth […]
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29. June 2015  |   State Aid Uncovered by Phedon Nicolaides

Levying of Charges to Maintain Equal Treatment Is Not Necessarily Selective
State Aid Blogs - SAH blogpost37 Hinkley Point C UK 2017
The standard of proof of whether a measure is selective depends on whether that measure is a scheme or a grant of individual aid. Measures providing for exemption are by definition selective. Measures that impose additional charges for the purpose of maintaining equality between operators are not necessarily selective even if the responsible authorities retain a degree of discretion in […]
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22. June 2015  |   State Aid Uncovered by Phedon Nicolaides

Ex post Monitoring of a Risk Capital Fund
State Aid Blogs - 10.10. Stateaid deminimis calculator
Ex post monitoring will be pursued vigorously by the Commission. Irregularities in the implementation of State aid measures may lead to the opening of the formal investigation procedure.   Introduction This article examines Commission decision concerning a UK risk capital scheme entitled Enterprise Capital Funds [SA.15373 and SA.33186]. The decision is the outcome of an investigation that was initiated after […]
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4. April 2014  |   State Aid Uncovered by Phedon Nicolaides

Guidance on the Application of Regulation 1370/2007 on Passenger Transport Services
train entering station
Public service obligations may only be imposed where the market does not provide adequate services in terms of price and/or quality. The selection of service providers must respect the principles of openness, transparency and non-discrimination, even when public procurement procedures may not apply. Compensation must be based on contracts which contain a precise definition of the public service and parameters on how […]
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28. March 2014  |   State Aid Uncovered by Phedon Nicolaides

Competitive Elements in the Selection of Operators of Sports Infrastructure May not Be Enough to Eliminate State Aid
sport arena seats
The existence of an advantage cannot be excluded when the operator of an infrastructural facility is chosen through a competitive procedure which combines price with other selection criteria. The users of a subsidised infrastructural facility who pay a market fee may still derive an advantage when the facility is designed and/or reserved for certain usage. Introduction   Ever since the Leipzig-Halle […]
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21. March 2014  |   State Aid Uncovered by Phedon Nicolaides

Public Funding of Projects that Encounter Financial Problems
motorway
Aid that is granted after the start of a project lacks incentive effect and is, therefore, incompatible with the internal market. However, aid may be justified when a project runs into financial trouble and, as a result, is likely to be abandoned without the aid. Introduction   In two decisions in December 2013, the European Commission authorised State aid for two […]
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14. March 2014  |   State Aid Uncovered by Phedon Nicolaides

SMEs Linked through Natural Persons
corporate building
Two or more enterprises may constitute a single undertaking when their owners and/or managers are related in a way that they can act jointly to exercise influence over the decision of those enterprises. Introduction   On 27 February 2014, the Court of Justice rendered a judgment on the notion of “linked enterprises” following a request for preliminary ruling from a […]
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6. March 2014  |   State Aid Uncovered by Phedon Nicolaides

The New Guidelines on State Aid to Airports and Airlines: Problematic Issues (part 2)
man looking airplane takeoff
Introduction Last week I reviewed the main provisions of the new Guidelines on State Aid to Airports and Airlines. This week I focus on three issues which are either not well explained or too ambiguous, leaving too much room for creative interpretation. [1] Investment funding gap The new Guidelines, like the other new rules, stress that aid must have an incentive […]
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28. February 2014  |   State Aid Uncovered by Phedon Nicolaides

The New Guidelines on State Aid to Airports and Airlines (part 1)
man looking airplane takeoff
Introduction[1] One more set of State aid rules for 2014-20 has been adopted. On Thursday, 20 February 2014, the Commission published its Guidelines on State Aid to Airports and Airlines.[2] The other main substantive rules which are already in place are the following, in chronological order:[3] The package on services of general economic interest (SGEI): A Communication, a Decision (like a […]
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21. February 2014  |   State Aid Uncovered by Phedon Nicolaides

The Role of National Courts in Recovery of Incompatible State Aid
court house
Introduction In December I examined the judgment in the case of Lufthansa v Frankfurt-Hahn, which laid down certain obligations for national courts whenever they are petitioned to suspend and even recover aid that happens to be at the same time under investigation by the Commission. In this article I review the judgment of the Court of Justice of 13 February […]
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14. February 2014  |   State Aid Uncovered by Phedon Nicolaides

An Assessment of the State Aid Consistency of Financial Instruments Supported by Structural and Investment Funds (Regulation 1303/2013)
coins on the table
Introduction Last week I reviewed the new State aid guidelines on risk finance. This week I will examine the provisions on financial instruments in the new structural and investment funds regulation. The regulation was published in the Official Journal just before Christmas. Both sets of rules have been updated on the basis of similar principles. The primary aim of both […]
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4. February 2014  |   State Aid Uncovered by Phedon Nicolaides

Guidelines on State Aid to Promote Risk Finance Investments
financial graph
Introduction   On 15 January the Commission adopted the fourth set of guidelines for the programming period 2014-2020 [the first three were those on broadband, SGEI, and regional aid]. The latest guidelines replaced those on risk capital for SMEs. What is immediately noticeable from the title of the new guidelines is that they are not confined only to funding in […]
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28. January 2014  |   State Aid Uncovered by Phedon Nicolaides

Services of General Economic Interest and Horse Racing
horse racing
Introduction Public authorities often argue that the activities they support are important and that they should be considered as services of general economic interest. However, in many cases they are not. In this article I review the Commission Decision 2014/19 concerning a parafiscal levy that was intended to fund supposedly public service obligations assigned to French horse racing companies.[1] This Decision […]
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