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

Summary of Lexxion Seminar: State aid for Tax Measures on 26-27 October 2015, Brussels

The following is a summary of the main points that were presented and the issues that were discussed in the seminar on State aid in Tax Measures that was held in Brussels on 26-27 October 2015. The summary has been prepared for information purposes only and it is not meant to be a precise record of the proceedings of the […]

Sale of Public Land and Conditions for Credible Expert Valuation

The value of land corresponds to its market price that can be determined through open and unconditional bidding. If a price cannot be determined through bidding, then expert valuation is an alternative method for establishing the value of land. Expert valuation has to be carried out ex ante, by a recognised independent surveyor, on the basis of reasonable assumptions and […]

Court’s Diary – November 2015

Find below the court’s diary for all State aid cases. Would you like to write a comment on one of them? Please don’t hesitate and get in touch with us ([email protected]), we are happy to publish your comment on the blog.   Wednesday 11/11/2015 Judgment in Case C-505/14 – Klausner Holz Niedersachsen (Court of Justice – Second Chamber) Thursday 12/11/2015 Judgment in […]

Economic Continuity and Recovery of Incompatible State Aid

Incompatible State aid must be recovered from “successor” companies which acquire previously aided companies and enable the latter to continue their operations without any change.     Introduction In this article I review two decisions in which the Commission determined that incompatible aid had to be recovered from “successor” companies. Those were companies which had obtained the assets of the […]

The Perennial Altmark Questions

A SGEI provider does not have to be efficient by industry standards in order to receive compensation for its next extra costs. Although the conditions for compatibility of public service compensation under Article 106(2) TFEU appear to be similar to the Altmark criteria, they have very different objectives.   Introduction Even since the Altmark judgment of July 2003, public authorities […]

A new misnomer in State aid law: single economic unit with separate legal personality (C 357/14 P, Dunamenti Erőmű/Commission)

The following blog post is a contributory piece by Emanuela Matei, Associate Researcher at the Centre of European Legal Studies, Bucharest. Matei holds a Juris Master in European Business Law (Lund University, June 2012), a Magister legum (Lund University, June 2010) and a BSc in Economics & Business Administration (Lund University, June 2009). We are very glad to welcome her […]

Should State Aid that Is Passed on to Consumers Not be Recovered?

Should the amount of recoverable aid be similarly reduced by the amount that is allegedly passed on to consumers? I will argue the case against it.   Introduction On 5 February 2015, the General Court, in cases T-473/12, Aer Lingus v Commission[1] and T-500/12, Ryanair v Commission[2], annulled Article 4 of Commission Decision 2013/199. In that decision the Commission found that a […]

A Primer on Compensation for the Extra Costs of Public Service Obligations Taking into Account Efficiency Gains

When Member States impose PSOs they are never allowed to grant even a single euro in excess of the net extra costs of the PSO. That is prohibited for the simple reason that it results in over-compensation.     Introduction The Lexxion seminar on state aid for transport and transport infrastructure that took place in Brussels on 21-22 September (view […]

Courts’s Diary – October 2015

Any comments on #Stateaid? Get in touch: Stateaidhub[at]lexxion.eu   Thursday 01/10/2015 Judgment in Case C-357/14 P – Electrabel and Dunamenti Erőmű v Commission (Court of Justice – Third Chamber)   Tuesday 06/10/2015 Judgment in Case C-303/13 P – Andersen v Commission (Court of Justice – Grand Chamber)   Thursday 08/10/2015 Hearing in Joined Cases T-479/11 & T-157/12 – France v Commission, […]

The State Acting as a Private Creditor & State Aid Enforcement and Procedural Rights

In this article I review Commission decision SA.37100 on JSC Liepajas Metalurgs [LM], once Latvia’s largest steel company and major employer. The decision examines whether Latvia acted promptly to recover a debt owed to it by a company that faced financial difficulties. The question was whether Latvia acted as a private creditor when it allowed the debtor to continue operations. […]

Compensatory Payments Can be State Aid

Article 107(1) also applies to payments that offset the damage caused by natural disasters. It is irrelevant that the compensation is partial or that competitors did not suffer similar damage. A measure can be State aid even if it is partially or wholly funded by private resources. It is sufficient that the resources come under state control. A measure is […]

Levying Taxes to Fund Public Broadcasters

Taxes may not be examined by the Commission in the context of Article 107 even if they finance State aid measures. By contrast, the Commission may examine a tax in the context of its assessment of the compatibility of aid with the internal market when the tax is inseparable from an aid measure. A tax is inseparable from an aid […]

A Textbook Case of i) How to Sell Public Assets without Passing on Incompatible State Aid to the Buyer, and ii) How to Work together with the Commission

An undertaking that has received incompatible State aid must pay it back or, if it cannot, it must be liquidated. Before a recipient of possibly incompatible State aid is liquidated, its assets can be sold off to the highest bidder. The buyer of previously subsidised assets does not benefit from State aid if i) it pays a market price and […]

Management of Port Infrastructure through a very long Concession Contract: Is the Funding Gap Method Meaningful?

Competitive selection of the operator of an infrastructural facility normally eliminates State aid. However, modifications to the contract after the operator is selected may confer an advantage that constitutes State aid. Public funding that is calculated on the basis of the “funding gap” method ensures that the aid is necessary and proportional. Introduction   Several recent articles in the blog […]

The Profitability of an Investment Must be Determined Ex Ante

Internal transfer of capital which is not used to fund new economic activities is not State aid. Injection of fresh capital to satisfy solvency and liquidity requirements still has to comply with State aid rules. A private investor always has the option of not injecting new capital and may opt instead to close down the business. A private investor always […]

Benchmarks of Profitability for Private Investors

A public authority that injects capital in an undertaking [or provides any other kind of finance] must ensure that the funding can achieve the rate of return that can, in principle, satisfy a private investor. The rate that can satisfy a private investor and ensure that the funding is free of State aid is the rate that covers the cost of […]

Sale of Public Assets, SGEI and Electricity Levies

Revenue from levies on electricity users is most likely to constitute State resources. Public service obligations can be transferred from one electricity-generating company to another. Compensation for public service obligations may distinguish between controllable and uncontrollable costs. Performance benchmarking can be used as a means for inducing efficiency. Electricity levies may not directly or indirectly discriminate against imported electricity. Introduction   This is a […]

Capital Injection that Turns out to be Incompatible State Aid

Public authorities and the entities they control need to ensure that injection of public money in an undertaking must satisfy the market economy investor principle, otherwise it will be considered to be State aid. Public funding of an undertaking in difficulty has to be preceded by an ex ante assessment that can show that either the recipient will be turned around […]

The New General Block Exemption Regulation: The Cornerstone of the State Aid Regime, 2014-2020

The new GBER at a glance Common Provisions: aid must be transparent, must have incentive effect, rules on cumulation, and aid measures and awards must be published. Specific Provisions: Thirteen categories and many types of aid. Exclusions: no export aid, no mandated use of domestic products, no aid to firms in difficulty, no provisions that violate EU law, and no aid to […]

Land Development without State Aid

Activities which are part of the performance of public duties are non-economic in nature [e.g. spatial development]. Public funding of these activities does not constitute State aid. The transfer of resources from one level of government to another is transfer between public authorities and does not constitute State aid. Competitive selected developers obtain no advantage. Purchasers of subsidised assets who pay market prices […]

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’.

Here’s how you can publish a post on the Blog as a guest author:

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

Step 2: We at Lexxion will review your draft to make sure its content and quality fit the blog. If needed, they will suggest what improvements you should make.

Step 3: Once your draft has been finalised and accepted, we will publish your post.

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