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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13. April 2021  |   State Aid Uncovered by Phedon Nicolaides

State Guarantee to an Energy Project
State Aid Blogs - StateAidHub blogpost15 gas
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 […]
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6. April 2021  |   State Aid Uncovered by Phedon Nicolaides

Lease Contracts and Competitive Selection
State Aid Blogs - cow 2436354 1920
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 […]
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30. March 2021  |   State Aid Uncovered by Phedon Nicolaides

“Global” Assessment of Tax Schemes
State Aid Blogs - StateAidHub blogpost13 Barcelona
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 […]
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23. March 2021  |   State Aid Uncovered by Phedon Nicolaides

Exclusive Rights and State Aid
State Aid Blogs - StateAidHub blogpost12 Poste Italiane
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 […]
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16. March 2021  |   State Aid Uncovered by Phedon Nicolaides

The Pan-European Guarantee Fund: The First State Aid Instrument at EU Level
State Aid Blogs - StateAidHub blogpost11 Funds
The Fund managed by the EIB constitutes State aid granted collectively by participating Member States. Introduction One of the many responses of the European Union to the economic harm wreaked by the pandemic was the establishment of the Pan-European Guarantee Fund [the Fund] by the European Investment Bank. Member States were invited to contribute to the Fund. This is both […]
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9. March 2021  |   State Aid Uncovered by Phedon Nicolaides

Can the Decision of a Private Entity be Imputed to the State?
State Aid Blogs - StateAidHub blogpost7 Bank Italy
A measure is imputable to the state whenever the state is involved in its adoption or shapes the decision that leads to its adoption. Introduction One of the trickiest aspects of determining whether a financial transaction involves State aid is its attribution or imputation to a decision of the state, especially when the entity providing the funding is private. Private […]
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2. March 2021  |   State Aid Uncovered by Phedon Nicolaides

State Aid May be Limited to Undertakings with Close Links with the National Economy (Part II)
State Aid Blogs - StateAidHub blogpost8 9 Ryanair
State aid may be used to compensate airlines licensed by domestic authorities for losses incurred as a result of national travel restrictions. [In case you have missed part I, you can access it here.] Introduction The European Commission acted swiftly to adopt a fairly accommodating and wide-ranging “Temporary Framework” to regulate State aid for the purposes of counter-acting the impact […]
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23. February 2021  |   State Aid Uncovered by Phedon Nicolaides

State Aid May be Limited to Undertakings with Close Links with the National Economy (Part I)
State Aid Blogs - StateAidHub blogpost8 9 Ryanair
State aid may be used to compensate airlines licensed by domestic authorities for losses incurred as a result of national travel restrictions. Introduction The European Commission acted swiftly to adopt a fairly accommodating and wide-ranging “Temporary Framework” to regulate State aid for the purposes of counter-acting the impact of covid-19. The Temporary Framework was welcomed by both Member States and […]
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16. February 2021  |   State Aid Uncovered by Phedon Nicolaides

Liquidity Assistance to Banks to Counter the Effects of Covid-19
State Aid Blogs - StateAidHub blogpost7 Bank Italy
Any direct public support of financial institutions affected by covid-19 has to comply with both State aid rules and the rules of the banking union. Introduction The Temporary Framework for State aid to combat covid-19 excludes financial institutions. But it does not mean that banks do not benefit indirectly from State aid granted to other sectors of the economy. This […]
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9. February 2021  |   State Aid Uncovered by Phedon Nicolaides

The State Acting as a Regulator
State Aid Blogs - StateAidHub blogpost6 NL gambling
When the state acts as a regulator, it does not have to charge a licence fee that maximises its revenue. Introduction Governments can influence the allocation of resources with at least three instruments: subsidisation, taxation and regulation. All three may contain State aid; if subsidies are selective, if taxes allow for exemptions and if regulation involves charges which are not […]
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3. November 2020  |   State Aid Uncovered by Phedon Nicolaides

The Concept of SME, Indirect Control by Public Bodies and New Problems for Public Universities and Research Organisations
State Aid Blogs - columns 5135499 1920
I am grateful to Peter Staviczky for comments on an earlier draft. A company that is owned by more than 25% by public bodies is not considered to be an SME, regardless of whether those public bodies actually exercise direct or indirect control. A public university can be a public body. Temporary Framework Update: Number of approved and published covid-19 […]
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3. November 2020  |   State Aid Uncovered by Phedon Nicolaides

Evaluation of EU State Aid Rules: Need for Greater Transparency
State Aid Blogs - office 4249408 1920
On Friday, 30 November 2020, the European Commission published a Staff Working Document [SWD(2020) 257 final] presenting and assessing the results of the evaluation of the main State aid rules of the EU. The SWD explains the aims of the State Aid Modernisation [SAM] that was launched in 2012 and summarises the findings of the Fitness Check of the GBER, […]
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27. October 2020  |   State Aid Uncovered by Phedon Nicolaides

The Common European Interest and the Environmental Impact of State Aid: The Case of Nuclear Power
State Aid Blogs - nuclear power plant 4535761 1920
I am grateful to Peter Staviczky for comments on an earlier version. The possible negative impact of State aid on the environmental is taken into account when the aid measure violates directly the relevant EU law. The Commission protects the interests of other Member States by ensuring that the negative effects of State aid are kept to the minimum possible. […]
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20. October 2020  |   State Aid Uncovered by Phedon Nicolaides

Employees’ Social Security Contributions and Compensation for Damage
State Aid Blogs - fishing boats 1785400 1920
Fiscal benefits to employees do not constitute State aid as long as they do not confer a direct or indirect advantage to their employers. Update on Temporary Framework: Number of approved and published Covid-19 measures, as of 16 October 2020: 302* Legal basis: Article 107(2)(b): 32; Article 107(3)(b): 255; Article 107(3)(c): 23 Average number of measures per Member State: 11 […]
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13. October 2020  |   State Aid Uncovered by Phedon Nicolaides

Market Economy Operator Principle: The Case of FIH
State Aid Blogs - danish currency 1139103 1920
Negotiated transactions are not necessarily market conform. Update on Temporary Framework: Number of approved and published covid-19 measures, as of 9 October 2020: 295* Legal basis: Article 107(2)(b): 32; Article 107(3)(b): 248; Article 107(3)(c): 23 – Average number of measures per Member State: 10.5 – Median number of measures per Member State: 12 – Mode number of measures per Member […]
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6. October 2020  |   State Aid Uncovered by Phedon Nicolaides

Member States Beware: Compliance with the GBER and the SME Criteria has just Become more Difficult
State Aid Blogs - doors 1767564 1920
I am grateful to Péter Staviczky for comments on an earlier draft of this article. I am solely responsible for its contents. The European Commission retains its sole right to assess the compatibility of aid granted on the basis of the GBER. Criteria defined in national law need not be taken into account by the Commission. The SME status has […]
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30. September 2020  |   State Aid Uncovered by Phedon Nicolaides

Market Economy Operator Test
State Aid Blogs - riga 2935034 1920
A rational airport operator considers only incremental revenue and costs and ignores any cost not caused by an agreement with an airline. State aid developments: New Guidelines in State aid in EU ETS The Commission published on Friday, 25 September, in Official Journal C 317, p.5, the new Guidelines on State aid measures in the context of the system for […]
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22. September 2020  |   State Aid Uncovered by Phedon Nicolaides

A Real Estate Deal that Does not Affect Intra-EU Trade
State Aid Blogs - hall 1489766 1920
Operators selected through competitive, transparent, non-discriminatory and unconditional procedures receive no State aid. When only a single bid is submitted, the market conformity of the outcome must be verified with comparative analysis. Activities are purely local when they are not likely to attract customers or operators from abroad. Update on Temporary Framework: Number of approved and published covid-19 measures, as […]
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15. September 2020  |   State Aid Uncovered by Phedon Nicolaides

Non-economic Activities and Services of General Economic Interest
State Aid Blogs - environmental protection 683437 1280
Non-economic tasks and economic activities which are inseparable from those non-economic tasks are together, as a bundle, non-economic in nature. Public compensation for the extra costs of services of general economic interest [SGEI] may not cross-subsidise activities that fall outside the scope of the SGEI. Update on Temporary Framework: Number of approved and published covid-19 measures, as of 11 September […]
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8. September 2020  |   State Aid Uncovered by Phedon Nicolaides

State Control without State Imputability
State Aid Blogs - Postnord
A snapshot of Covid-19 State aid Number of Covid-19 approved measures1, 2 [EU27 + UK, 4 September 2020] 19-15 13-11 9-7 6-4 BE CZ DK IT PL DE FR HU LV NL BG EL FI IE LT LU MT RO SE SK UK AT CY EE ES HR PT SI Source: DG Competition, author’s own calculations 1: Data exclude amendments […]
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