Europäisches Beihilfenrecht Blog

State Aid Uncovered Blog

In Lexxions Blog „State Aid Uncovered” veröffentlicht Prof. Phedon Nicolaides wöchentlich kritische Analysen zu den neuesten Urteilen und Entscheidungen zu staatlichen Beihilfen. Jeder Beitrag stellt die wichtigsten Punkte eines Gerichtsurteils oder einer EU-Kommissionsentscheidung vor, ordnet sie in den Kontext ähnlicher Rechtsprechung oder Praxis ein, bewertet die zugrundeliegende Argumentation und zeigt etwaige Ungereimtheiten oder Widersprüche auf.

In loser Folge werden auf diesem Blog auch Gastbeiträge von anderen Experten für staatliche Beihilfen veröffentlicht, welche die Inhalte der Blogbeiträge ergänzen.

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Professor at Maastricht University; Professor at University of Nicosia, and Academic Director at Lexxion Training

Public Service Obligations Must be Properly Defined and Selectivity Must be Proven [1]

Neither the existence of market failure, nor national laws that designate a service to be in the general interest can replace an official act that assigns to one or more undertakings clearly defined public service obligations.   Introduction The proper definition of public service obligations (PSOs) is an issue that arises with surprising regularity. It is surprising because numerous court […]

Unlimited State Guarantees

Unlimited state guarantees create a presumption that the recipient of the guarantee obtains an advantage in the form of cheaper credit. Any advantage in the form of lower risk in transactions with suppliers or clients has to be proven.   Introduction State guarantees must be limited in time and amount and may cover only a specified event. Unlimited and general […]

Ex ante Assessment of Future Profitability is Absolutely Necessary

A private investor assesses the prospects of future profitability before it invests. The burden of proof lies with the Member State that claims it has acted as a private investor.   Introduction The market economy investor principle is based on a simple premise: before you commit your money you need to check how much you are likely to get back. […]

The Compatibility of State Aid with the Internal Market: Lessons from “Hinkley Point C” – Part III

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 Compatibility of State Aid with the Internal Market: Lessons from “Hinkley Point C” – Part II

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 Compatibility of State Aid with the Internal Market: Lessons from “Hinkley Point C” – Part I

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 […]

Selectivity Can Exist at Different Levels: The Case of the Spanish Tax Lease System

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 […]

Public Procurement and State Aid

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 […]

Public Service Compensation

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 […]

The European Commission’s Code of Best Practices on State Aid Procedures

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 […]

Danish Horse Racing

Taxes hypothecated to State aid measures fall within the scope of the assessment of the compatibility of those measures.   Introduction Operating aid is not normally allowed. Yet, in decision SA.48604 concerning horse-racing betting in Denmark the Commission appears to have authorised operating aid.[1] This measure was approved within six months. In the post-SAM, it must be one of the […]

Selectivity Requires Comparison

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 […]

Structural Disadvantages and Regional Aid

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, […]

PART II: Concessions and State Aid: Does the State Act as a Regulator or Market Operator?

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 […]

PART I: Concessions and State Aid: Does the State Act as a Regulator or Market Operator?

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 […]

Top 5 State Aid Uncovered Posts in 2017

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 […]

Sport and Trade

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 […]

How to Determine whether State Aid Affects Trade

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.   […]

Imputability of an Aid Measure to the State Does not Require a Counterfactual

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 Legal Basis of the (In)compatibility of Aid Must be Clear

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 […]

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