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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12. December 2013  |   State Aid Uncovered by Phedon Nicolaides

Why Can the Commission Not be Consistent in its Analysis of Economic Activity and Affectation of Trade?
antique monument
Introduction If you ask a national official who deals with State aid to identify the most challenging aspects of working with State aid rules, the answer is likely to be “the concept of undertaking” and the “effect on trade”. Other aspects can also be challenging, but a national official is unlikely to agonise about the transfer of state resources, the […]
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6. December 2013  |   State Aid Uncovered by Phedon Nicolaides

Non-notified State Aid and the Role of National Courts C 284/12, Deutsche Lufthansa v Flughafen Frankfurt-Hahn
airplane on the runway
Introduction What prevents a Member State from granting State aid without first notifying it to the European Commission? Cynics would answer “nothing, in fact”. Indeed, nothing can stop a country that is determined to provide a subsidy. But after the judgment in case Lufthansa v Frankfurt Hahn Airport, the answer must be “unnecessary hassle”. Even if there is a slight […]
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29. November 2013  |   State Aid Uncovered by Phedon Nicolaides

The Private Investor Principle Applied to Loans [Commission Decision 2013/528]
ship in the shipyard
Introduction The State aid issue in this case is relatively straightforward. Nauta, a Polish shipyard, received a two-year loan from IDA, the state-owned Polish Investment Agency. Because Nauta ran into some financial trouble, the loan was extended for another two years. In Decision 2013/528, the Commission had to examine two questions: First, did the initial loan market conform? Second, if […]
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22. November 2013  |   State Aid Uncovered by Phedon Nicolaides

How Not to Determine the Effect on Trade [Infrastructure for Tourism, Czech Republic (SA.35909)]
Prague panorama
Introduction Normally the articles in this blog identify landmark court rulings and seminal decisions of the Commission which set important precedents and provide useful guidance to State aid professionals and practitioners. This article deviates from this custom. It examines a recent case where the Commission concluded that public subsidies did not constitute State aid because intra-EU trade was not affected. […]
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15. November 2013  |   State Aid Uncovered by Phedon Nicolaides

Private Vendor Principle: How to Organise a State-Aid-Free Sale of Public Assets
bank building
Introduction   The private investor principle (PIP) or market economy investor principle is well established in the case law. A closely related concept is the private vendor principle (PVP). The PIP applies when a public authority assumes risk by investing in an undertaking, for example through the purchase of shares, injection of capital, granting of a loan or provision of […]
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8. November 2013  |   State Aid Uncovered by Phedon Nicolaides

Tax Hypothecation and Economic Efficiency under Altmark: T-275/11, French Television 1 v Commission
television
Background France Télévisions is a limited company wholly owned by the French State. As France abolished advertising on public television, it also decided to provide financial compensation to France Télévisions. For this reason it introduced new taxes to generate revenue for the compensation: a tax on advertising and a tax on electronic communications. In January 2009, France notified to the […]
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31. October 2013  |   State Aid Uncovered by Phedon Nicolaides

A Public Authority Can Behave Like a Private Investor even when the Beneficiary Has Little Prospect of Future Profitability
airplane flying
Introduction When a public authority invests in an undertaking, it must earn a return at market rates, otherwise the investment is State aid. Normally, it is much easier to prove that the investment has a reasonable prospect of profitability and, therefore, that it would be made by a private investor, when the recipient undertaking is in a good financial situation. […]
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18. October 2013  |   State Aid Uncovered by Phedon Nicolaides

A Case of Public Funding of Infrastructure that Does not Constitute State Aid: But Many Questions Remain
fortress
Introduction After the landmark judgment in Leipzig-Halle, public authorities are justifiably careful to ensure that the infrastructure they fund is either free of State aid or, if that is unavoidable, that the State aid is compatible with the internal market. Recent cases have shown that there are two problems in this regard. First, public authorities must verify whether the organisations […]
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11. October 0213  |   State Aid Uncovered by Phedon Nicolaides

New Case Law on Incentive Effect, “Private Borrower”, Advantage, Compensation, SGEI and Market Failure
gavel on a laptop
Introduction   The posting reviews three recent rulings of the General Court. They are significant because they introduce substantial nuances in the case law concerning the concepts of incentive effect, compensation for structural impediment, the designation of an activity as a service of general economic interest (SGEI) and the connection between market failure and SGEI. On the whole, the Court […]
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4. October 2013  |   State Aid Uncovered by Phedon Nicolaides

The Offsetting of a Structural Disadvantage Is still State Aid
scale and a book
Introduction Normally it is conceptually and technically fairly easy to determine whether an undertaking benefits from a public measure. However, this task becomes considerably more difficult in two situations: i) when a public authority claims that it acts like a private investor and ii) when a public measure is intended to compensate for a disadvantage suffered by the beneficiary undertaking […]
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