State Aid Law Blog

State Aid Uncovered by Prof Phedon Nicolaides

On a weekly basis Phedon Nicolaides posts critical analysis pieces on the latest State aid judgments and decisions on his blog State Aid Uncovered. Each article presents the main points of a court ruling or Commission‘s decision, places them in the context of similar case law or practice, assesses the underlying reasoning, and identifies any inconsistencies or contradictions.
Occasional guest blog posts by other State aid experts complement the State aid knowledge hub.

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

23. December 2019  |   State Aid Uncovered by Phedon Nicolaides

A Preferential Electricity Tariff Is Selective, Confers an Advantage and Distorts Competition
State Aid Blogs - StateAidUncovered blogpost53 Alouminion
A judicial decision on interim measures is a selective measure. The private investor test does not apply to judicial decisions on interim measures. Introduction On 11 December 2019, in case C‑332/18 P, Mytilinaios Anonymos Etairia — Omilos Epicheiriseon v European Commission, the Court of Justice probably wrote the last chapter in a long-running case concerning privileges that had been granted […]
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17. December 2019  |   State Aid Uncovered by Phedon Nicolaides

Can a Tax (rather than a Tax Exemption) Confer a Selective Advantage?
State Aid Blogs - StateAidHub blogpost52 Stateaid Lexxion TAX Water Spain European Commission
A tax that is levied at one level of government and does not apply to products and activities at a different level of government need not be selective. Introduction A tax exemption normally confers a selective advantage, unless it is justified by the logic of the tax. Counterintuitively, a tax itself can be selectively advantageous if its scope is too […]
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10. December 2019  |   State Aid Uncovered by Phedon Nicolaides

Retroactive Application of the GBER
State Aid Blogs - m
When an aid scheme is adjusted by limiting the eligible beneficiaries, it becomes “new” aid and must be notified to the Commission. The GBER can be applied retroactively to aid that was granted before it came into force.   Introduction In July 2016, Dilly’s Wellnesshotel wrote legal history for being the first undertaking to contest the application of the General […]
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5. December 2019  |   State Aid Uncovered by Phedon Nicolaides

Will Brexit Usher in Protectionism?
State Aid Blogs - StateAid Blogpost Brexit EU Lexxion
The Financial Times reported on Friday, 29 November 2019, that the Conservative party in the UK announced that it would establish a different state aid system to “protect British industry after Brexit”. The Prime Minister, Boris Johnson, was quoted to have said at a press conference on the same date that the new state aid system would make it “faster […]
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3. December 2019  |   State Aid Uncovered by Phedon Nicolaides

Separability of Economic from Non-economic Activities
State Aid Blogs - StateAidHub blogpost50 2019 lexxion economy printing non economic Stateaid SGEI
Activities which are inseparable from the exercise of official powers are non-economic. Introduction   Pure research whose results are widely disseminated is undoubtedly a non-economic activity. Research reports are often published on the internet. But the design and management of a research organisation’s website can be an economic activity. Plenty of private companies provide these services for a fee. Does […]
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26. November 2019  |   State Aid Uncovered by Phedon Nicolaides

How to Assess a Shareholder Loan
State Aid Blogs - StateAidHub blogpost49 shareholder loan MEOP
A shareholder loan cannot be simply compared to a bank loan because the shareholder also benefits from improvements in the future profitability of the borrower. Introduction When a public authority grants a loan to a company, the methodology in the 2008 Commission communication on reference and discount rates can be used to determine whether the loan contains State aid. However, […]
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19. November 2019  |   State Aid Uncovered by Phedon Nicolaides

Compensation to a Toll Road Operator
State Aid Blogs - StateAidHub blogpost48 toll road motorways Poland obligations StateAid
Contractual obligation to provide compensation that does not exceed the loss of income is not State aid. Introduction When is a company entitled to compensation by the state? The easy answer is “when the state is liable for damage”. However, it may be possible for a company to claim compensation from the state when the state has assumed contractual obligations. […]
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14. November 2019  |   State Aid Uncovered by Phedon Nicolaides

Risk Finance
State Aid Blogs - StateAidHub blogpost47 Finance lexxion GBER SMEs
Risk finance measures for the support for large enterprises or SMEs which operate for longer than seven years fall outside the GBER and must be notified individually to the Commission. Introduction Since the State aid modernisation and the new rules that were introduced in 2014, only a handful of risk finance measures [7-8?] have been notified to the European Commission […]
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5. November 2019  |   State Aid Uncovered by Phedon Nicolaides

Economic Continuity in Recovery of Incompatible State aid
Lab test
The new owner of a company that received incompatible State aid may be liable to pay it back. Introduction   Companies rarely escape from the obligation to repay incompatible State aid. Over the past decade or so, very few companies have successfully argued that they legitimately expected that the aid they received was compatible with the internal market. When a […]
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30. October 2019  |   State Aid Uncovered by Phedon Nicolaides

The Operator of an Economic Infrastructure is an Undertaking
State Aid Blogs - m 1
The assignment of public service tasks to an infrastructure operator is not sufficient to prevent the application of State aid rules. Introduction The characterisation of an entity as an undertaking is activity based, not status based. If it carries out activities for which there is a market, it becomes an undertaking, regardless of providing services which are in the general […]
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11. June 2019  |   State Aid Uncovered by Phedon Nicolaides

I) Unlimited State Guarantees II) Effect on Trade
State Aid Blogs - StateAidHub blogpost23
A competitor who wants to challenge a Commission decision authorising State aid without a formal investigation must, first, show that it is seriously harmed by the aid. Introduction This week’s article reviews two judgments: one on unlimited state guarantees granted by France [case T-135/17, Scor v European Commission][1] and another on aid that was found not to affect trade between Member […]
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4. June 2019  |   State Aid Uncovered by Phedon Nicolaides

Not Every Compensation Is a Compensation in the Meaning of Altmark
State Aid Blogs - StateAidHub blogpost22 electricity Altmark SGEI
Regulation and licensing do not constitute obligations for the provision of an SGEI. Compensation for changes in public policy is not compensation that complies with the Altmark conditions. Introduction The calculation of the compensation for the net extra costs of public service obligations [PSO] is a difficult task. On 15 May 2019, in case C-706/17, Achema et al v Lithuania […]
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28. May 2019  |   State Aid Uncovered by Phedon Nicolaides

What Happens when Internal Market Rules and State Aid Rules Clash?
State Aid Blogs - StateAidHub blogpost21 Tax Refund
A tax refund may not be granted, if it constitutes non-notified State aid.   Introduction   It is a well-established principle that restrictions on internal market rights or freedoms may not be attached to a State aid measure. Indeed, current State aid rules [e.g. GBER, guidelines] explicitly exclude from their scope any aid measure which is inseparably linked to a […]
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21. May 2019  |   State Aid Uncovered by Phedon Nicolaides

There Is No Threshold below which Economic Activities Can Be Considered to be Non-economic
State Aid Blogs - StateaidHub blogpost20 Lexxion Port Economic Activities
Non-economic activities have to be accounted separately from economic activities. The exercise of public tasks assigned by the state cannot protect an undertaking from State aid rules. State aid distorts competition even when it aims to remedy distortions. Introduction Ports, like other transport infrastructures, may operate under public obligations some of which may be of economic and some of non-economic […]
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16. May 2019  |   State Aid Uncovered by Phedon Nicolaides

Competitors’ Rights
State Aid Blogs - StateaidHub blogpost19 Lexxion Lufthansa Airport StateAid Ryanair Frankfurt Competition EU Commission
A competitor must show that it is substantially affected by State aid approved by the Commission in order to challenge the Commission’s decision. Merely being affected by the aid is not enough. To show that aid has a substantial impact, it is first necessary to define the relevant market. This is different from the “distortion of competition” in the meaning […]
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7. May 2019  |   State Aid Uncovered by Phedon Nicolaides

Land Development: The Case of Jaguar Land Rover Slovakia
State Aid Blogs - StateAidHub blogpost18 Landrover Jaguar Nitra Stateaid Infrastrsucture Transport Lexxion
Public funding of infrastructure which is not constructed for the specific needs of a company is not State aid.   Introduction An article carried by the Financial Times on 1 May 2019 revealed that Jaguar Land Rover [JLR] decided to make again the iconic Land Rover Defender. The production of this legendary off-roader ended about 10 years ago because it […]
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30. April 2019  |   State Aid Uncovered by Phedon Nicolaides

The Commission Must Explain its Decision
State Aid Blogs - StateAid Blogpost17 2019 Lexxion UPS DeutschePost Eu Commission State Aid
A Commission decision that affects the legal position of an undertaking is actionable before EU courts. The opening of the formal investigation procedure must lead the Member State concerned to suspend the aid measure and may result in a recovery ruling by a national court. The Commission must be consistent in its reasoning. If it cannot use certain information at […]
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23. April 2019  |   State Aid Uncovered by Phedon Nicolaides

State Control: The Case of EEG 2012
State Aid Blogs - 5 most read articles 2019
There is crucial difference between control by the state over resources and attribution to the state of the aid granting decision.   Introduction According to the latest edition of the State aid Scoreboard, in 2017 Member States granted a total of EUR 105 billion of State aid to manufacturing and services. Of that amount, 58% or EUR 61 billion supported […]
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16. April 2019  |   State Aid Uncovered by Phedon Nicolaides

Spanish Football Clubs Score against the Commission: a) Linked Advantages and Disadvantages Must be Assessed Together b) In Determining the Existence of an Advantage, the Commission Must Explain both what it Takes into Account and what it Ignores
State Aid Blogs - StateAidHub blogpost15 Soccer loans Lexxion Spain EU Commission
State measures which are linked and produce both positive and negative effects, must be considered together to determine whether they confer a net advantage to undertakings. Counter-guarantees must be taken into account to determine the existence of advantage even if they are provisional.   Introduction Member States have in a number of cases tried to defend tax reductions or tax […]
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9. April 2019  |   State Aid Uncovered by Phedon Nicolaides

The Boundary between State and Private Resources
State Aid Blogs - StateAidHub blogpost14 StateAid Lexxion Money Eu Commission Bank Financial
Discretion in the form of intervention can remove it from the control of the state.   Introduction Suppose a thug puts a gun to your head and demands your wallet. Because you have sentimental photos in your wallet, you offer instead the keys to your car. You would rather lose the car than the wallet. Can the thug claim in […]
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How to Submit a Blog Post

Do you want to share your analysis of a State aid law topic? We invite you to submit your post on, for example: recent European, national or international judgments or legislation with relevance to EU State aid law; new developments, publications, hot topics in EU State aid law. The recommended length of the post is 500-2,000 words incl. references (endnotes). Your analysis will be published under the category ‘Guest State Aid Blog’.

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Step 1: Submit your draft to Nelly Stratieva at [email protected].

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