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The Evolving Interpretation of Article 107(3)(b) TFEU

Phedon Nicolaides


Keywords: Article 107(3)(b), appropriateness, necessity, proportionality, common European interest

This article reviews the evolving case law on Article 107(3)(b) TFEU. It is now established that State aid must be appropriate, necessary and proportional. However, this article finds that it is still not clear in the case law how they are to be applied in conjunction with each other. Several judgments of the General Court delivered in 2021 also indicate that the principle of proportionality can refer to both the amount of aid as well as to the scope of the aid measure. The 2021 judgments of the General Court represent a departure from previous case law in so far as they dispense with any assessment of the impact of State aid on trade and competition. Since aid on the basis of Article 107(3)(b) aims to remedy a serious economic disturbance, it is also presumed to be in the interest of all Member States. Pending cases before the Court of Justice may still reverse this new interpretation of the application of Article 107(3)(b).
Keywords: Article 107(3)(b); appropriateness; necessity; proportionality; common European interest

Phedon Nicolaides, Professor at the University of Maastricht and the University of Nicosia. I am grateful to an anonymous referee for comments on an earlier version.


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