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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19. January 2016 | State Aid Uncovered by Phedon Nicolaides

Is there an Advantage when the State Pays for Compulsory Milk Tests?

Undertakings obtain an advantage when the state pays for their normal costs. Normal costs are costs which are inherent in the operations of undertakings. The costs of meeting legal obligations are normal. Introduction The case law on advantage in the meaning of Article 107(1) TFEU says that aid confers an advantage to undertakings when they obtain a benefit that […]

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12. January 2016 | State Aid Uncovered by Phedon Nicolaides

Valuation of Assets Disposed by the State

The value of an asset can be determined according to different methods. The main methods examine future income or comparable transactions or stock market valuation. Agreements between sellers and buyers that contain indemnification clauses or settle past claims do not reflect the true market value of the sold asset. Introduction 9 December 2015, the General Court rendered its judgment […]

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5. January 2016 | State Aid Uncovered by Phedon Nicolaides

An Exception Is Not Necessarily Selective: The Case of the Spanish Tax Lease [1]

An exception from a tax system is not selective if it is a priori open to any tax payer. Checks by tax authorities to ensure that a measure is applied correctly do not constitute exercise of administrative discretion that may render a measure de facto selective. The impact of a measure on trade and competition cannot be merely presumed just […]

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1. January 2016 | Guest State Aid Blog by Lexxion Publisher

Court’s Diary – January 2016

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. Thursday 28/01/2016 Judgment in T-507/12 -Slovenia v Commission (General Court – Fifth Chamber) Do you know we also publish […]

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29. December 2015 | State Aid Uncovered by Phedon Nicolaides

Regional Aid to Car Manufacturers – Part II

This is the second part of the article that was published last week. Regional aid, like all State aid, must be necessary and proportional. Regional aid is necessary when investment in an assisted region is more costly. Regional aid is proportional when it does not exceed the amount which can make the investment sufficiently profitable or offset the cost disadvantage […]

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23. December 2015 | State Aid Uncovered by Lexxion Publisher

Regional Aid to Car Manufacturers

Regional aid, like all State aid, must be necessary and proportional. Regional aid is necessary when investment in an assisted region is more costly. Regional aid is proportional when it does not exceed the amount which can make the investment sufficiently profitable or offset the cost disadvantage of investment in an assisted region. Introduction In July 2014, the European […]

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14. December 2015 | State Aid Uncovered by Phedon Nicolaides

Altmark, again!

Sectoral regulation is not the same as definition of public service obligation. Aid that favours a certain technology is incompatible with the internal market, unless it can be objectively justified. Introduction “Altmark” has become a permanent feature in the landscape of State aid. Its application was again one of the main issues of contention in six judgments rendered by […]

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12. December 2015 | Guest State Aid Blog by Lexxion Publisher

i) New v Existing State Aid ii) Exemption from VAT and Attribution to Member States iii) The Duty of National Courts to Protect Competitors from Illegal State aid

Aid that pre-exists the entry of a Member State into the EU is “existing” and does not have to be recovered. VAT exemptions authorised by the EU are not State aid. National courts must disregard national legal provisions that prevent them from acting against illegal aid. Introduction This article examines a variety of issues: when State aid is existing […]

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9. December 2014 | State Aid Uncovered by Phedon Nicolaides

A Surprising Interpretation of the Concept of Selectivity

Tax measures are selective when they constitute an exception or deviation from the normal or common system of taxation. In addition, the exception must be open only to a pre-defined category of undertakings. IntroductionOften, the decisive element in whether a tax measure constitutes State aid is the existence of selectivity. On 7 November 2014, the General Court ruled on two […]

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1. December 2014 | State Aid Uncovered by Phedon Nicolaides

The First Application of the New GBER to Sport Infrastructure

Public funding of local sport infrastructure may constitute State aid. The granting of a concession contract for the construction and/or operation of the infrastructure may not exclude State aid for the concessionaire. Measures based on the new GBER have to satisfy both its general and specific provisions. The funding gap method can be used in the context of the GBER. […]

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24. November 2014 | State Aid Uncovered by Phedon Nicolaides

Land Transactions: Commercial Deals v Regulatory Acts

Regulation on land use or changes in such regulations do not constitute State aid. Administrative methods for calculating the value of public land do not necessarily prevent the granting of State aid if they do not reflect the evolution in market valuations. IntroductionMany local authorities own land or regulate the use of land. They also sell or buy land. […]

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18. November 2014 | State Aid Uncovered by Phedon Nicolaides

Recovery of State Aid and Penalty for Failing to Recover Incompatible Aid

Extension of an existing aid measure results in the granting of new aid. Only conditions of absolute impossibility can justify non-recovery of incompatible aid. Member States have to exhaust all possible options to recover incompatible aid and, if necessary, have to force the closure of the recipient of the aid. IntroductionIn this article I examine two recent judgments both of […]

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11. November 2014 | State Aid Uncovered by Phedon Nicolaides

Reduction of Property Taxes and Electricity Tariffs

Relief from property tax is State aid even when the user of the property is involved in defence contracts. Providing cheaper electricity to a few manufacturers cannot be considered to be an appropriate measure for regional development. Introduction This article summarises several judgments which were delivered in October 2014. They concern a tax exemption in Spain and reduction of electricity […]

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2. November 2014 | State Aid Uncovered by Phedon Nicolaides

The Market Economy Investor Test Applied to a Financially Troubled Company

Public funding of an undertaking is free of State aid when it is accompanied at the same time and on equivalent terms by similar private funding. If public funding is provided at the insistence of the private investors, it cannot be considered to be “pari passu” with the private participation. Public funding into a financially troubled company can still be […]

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27. October 2014 | State Aid Uncovered by Phedon Nicolaides

A Measure is Selective if its Application is Narrower than the Scope of the Objective it Seeks to Achieve

A measure is attributed to a decision of a Member State if it is allowed but not mandated by an EU directive. A measure is selective when in practice it is open to fewer undertakings than the ones to which it can potentially apply by its own defined objectives. Introduction This article examines Commission Decision 2014/686 on a guarantee […]

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20. October 2014 | State Aid Uncovered by Phedon Nicolaides

i) State Aid Can Be Attributed to the State even when Granted via Faulty Procedures ii) Who Can Challenge a Commission Decision Authorising State Aid?

For a measure to constitute State aid, it must, among other things, be attributed to a decision of the state. When a State aid granting decision is made in contravention of the procedural rules of an organisation controlled by the state, the decision can still be attributed to the state, unless it can be shown that the state would have […]

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13. October 2014 | State Aid Uncovered by Phedon Nicolaides

Advantage from High Entry Prices: Can It Be That Both the Commission and the General Court Have Misunderstood Simple Economics?

Price regulation can constitute State aid if the state forgoes potential revenue. However, for price regulation to constitute State aid it must satisfy all of the criteria in Article 107(1). Price regulation that affects all competitors proportionately does not confer an advantage and therefore does not constitute State aid. Introduction On 11 September 2014, the General Court, in case […]

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6. October 2014 | State Aid Uncovered by Phedon Nicolaides

i) Domestic Legal Problems Do Not Make the Recovery of Incompatible Aid Absolutely Impossible ii) Role of National Courts in Cases of Non-notified Aid

The only defence for non-recovery of incompatible State aid is absolute impossibility. Obstacles in domestic legal proceedings may result in absolute impossibility, but Member States have an obligation to inform the Commission and national courts have to seek guidance from the Court of Justice of the European Union. Introduction This article deals with two aspects of the recovery of […]

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State Aid Uncovered Blog

Is there an Advantage when the State Pays for Compulsory Milk Tests?

Valuation of Assets Disposed by the State

An Exception Is Not Necessarily Selective: The Case of the Spanish Tax Lease [1]

Court’s Diary – January 2016

Regional Aid to Car Manufacturers – Part II

Top 5 Most Read State Aid Uncovered Posts of the Year

Regional Aid to Car Manufacturers

Altmark, again!

Top 3 State Aid Blog Posts from 2015

i) New v Existing State Aid ii) Exemption from VAT and Attribution to Member States iii) The Duty of National Courts to Protect Competitors from Illegal State aid

A Surprising Interpretation of the Concept of Selectivity

The First Application of the New GBER to Sport Infrastructure

Land Transactions: Commercial Deals v Regulatory Acts

Recovery of State Aid and Penalty for Failing to Recover Incompatible Aid

Reduction of Property Taxes and Electricity Tariffs

The Market Economy Investor Test Applied to a Financially Troubled Company

A Measure is Selective if its Application is Narrower than the Scope of the Objective it Seeks to Achieve

i) State Aid Can Be Attributed to the State even when Granted via Faulty Procedures ii) Who Can Challenge a Commission Decision Authorising State Aid?

Advantage from High Entry Prices: Can It Be That Both the Commission and the General Court Have Misunderstood Simple Economics?

i) Domestic Legal Problems Do Not Make the Recovery of Incompatible Aid Absolutely Impossible ii) Role of National Courts in Cases of Non-notified Aid

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