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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28. January 2020  |   State Aid Uncovered by Phedon Nicolaides

State Aid Rules in the UK after Brexit: Alignment or Divergence?
State Aid Blogs - StateAidHub blogpost4 Brexit
The current rules will apply at least until 31 December 2020. Introduction On Saturday, 1 February 2020, the United Kingdom will no longer be a Member of the European Union. Will it then have to abide by EU State aid rules? According to the Agreement on the Withdrawal of the UK from the EU, the whole of the UK will […]
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23. January 2020  |   State Aid Uncovered by Phedon Nicolaides

Public Subsidies to Households Can Be State aid
State Aid Blogs - m 44
Support for individual borrowers can be indirect State aid to banks.   Introduction The fact that a public measure has social objectives and aims to help poor households or disadvantaged persons instead of undertakings does not necessarily remove it from the reach of State aid rules. During the past decade, in response to the economic crisis, a number of Member […]
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14. January 2020  |   State Aid Uncovered by Phedon Nicolaides

Exclusive Rights and Legal Monopolies
StateAidHub_LegalMonopolies
State aid rules can apply to sectors which are legal monopolies. Introduction The fact that a company enjoys exclusive rights and operates in a sector covered by a legal monopoly does not necessarily insulate it from State aid rules. This has been confirmed by the Court of Justice in its judgment of 19 December 2019, in case C-385/18, Arriva Italia […]
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7. January 2020  |   State Aid Uncovered by Phedon Nicolaides

Bail-in Is the Responsibility of Member States
State Aid Blogs - StateAidHub blogpost1 Bail In 2
Commission approval of State aid to bail-out a bank does not give rise to right for compensation for creditors who are bailed-in. Introduction Investors in banks who lost their money have sought compensation both at EU and national level. So far, claims for damages at EU level have been unsuccessful. In some instances, the cases before EU and national courts […]
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27. December 2019  |   State Aid Uncovered by Lexxion Publisher

5 Most Read Articles on StateAidUncovered in 2019
State Aid Blogs - 5 most read articles 2019
Groundbreaking judgments like “Eesti Pagar”, applications of the private investor principle in air transport or questions of interpretation of the GBER 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 still been on everyone’s mind. See which articles by Prof. Phedon Nicolaides were […]
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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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9. July 2019  |   State Aid Uncovered by Phedon Nicolaides

1) The European Commission Does not Have to Identify Individual Beneficiaries in its Recovery Decisions 2) Revision of the GBER [InvestEU, Seal of Excellence, ETC]
State Aid Blogs - StateAidHub blogpost27 GBER
This week’s article deals with two issues: possible defence against repayment of incompatible State aid and the forthcoming revision of the GBER. Introduction In 2008, the Commission ordered France to recover incompatible aid that had been granted by means of several public measures to support farmers [see Commission decision 2009/402]. What made that decision interesting was that part of the […]
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2. July 2019  |   State Aid Uncovered by Phedon Nicolaides

Application of the MEOP to Energy Infrastructure
State Aid Blogs - StateAidHub blogpost26 energy infrastructure
A public authority that acts as a private operator may charge what the market can bear. Introduction In January 2019, Germany notified to the Commission, for reasons of legal certainty, investment of the municipality of Hamburg in a district heating network. The Commission, in decision SA.52390, found that the investment in Hamburg District Heating Network conformed with the Market Economy […]
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25. June 2019  |   State Aid Uncovered by Phedon Nicolaides

How to Value Land in Complex Land Swaps
State Aid Blogs - StateAidHub blogpost25 LandSwap RealdMadrid
A private investor assesses all components of a complex transaction and takes into account not just profit, but also the legal implications of the prospective transaction and possible future liability.   Introduction   When a public authority sells land, it should either auction it through a competitive and unconditional process or have it valued beforehand by an independent expert.Sometimes, public […]
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18. June 2019  |   State Aid Uncovered by Phedon Nicolaides

Is it OK to Tax Company Size?*
State Aid Blogs -
Progressive tax rates that are consistent with the objective of the tax system are not necessarily selective. Introduction Member States are free to design their corporate tax systems as long as they do not grant State aid or infringe fundamental internal market freedoms. A question that arises in discussions on what Member States may or may not do when designing […]
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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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