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Eesti Pagar: A Formalistic Approach to Incentive Effect and Recovery Procedures

Caroline Buts, Péter Staviczky

DOI https://doi.org/10.21552/estal/2021/4/9

Keywords: incentive effect, complaints, recovery, (recovery) interest rate/reference rate, limitation period, GBER, illegal aid, obligation of national granting entities

Eesti Pagar constitutes a milestone in State aid law. This article provides an overview of the judgment and discusses, in chronological order, the topics of the five questions dealt with by the Court. First, we review the importance of the criterium incentive effect and more specifically the timing of the aid application in relation to the start of the project. Second, we analyse the obligation of a national authority to recover unlawful aid, also in the absence of a Commission decision. Third, we investigate whether actions by national authorities (in breach of EU law) can cause legitimate expectations for an aid beneficiary. Fourth, regarding recovery procedures without a Commission decision, we reflect on the pertinent limitation period. Finally, we examine the applicable recovery interest rate.
Keywords: incentive effect; complaints; recovery; (recovery) interest rate/reference rate; limitation period, GBER, illegal aid, obligation of national granting entities
Milestones Preview: this article is based on a chapter of the upcoming second edition of the book 'Milestones in State Aid Case Law' (Lexxion 2022).

Caroline Buts is professor at the Department of Applied Economics of the Vrije Universiteit Brussel. Péter Staviczky is Attaché responsible for State aid at the Hungarian Permanent Representation to the EU.Suggestions made by José Luis Buendía are gratefully acknowledged.


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