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State Aid Junkies, Viruses and the Aviation Industry: journal article

Ryanair’s Litigation against Approved Aid Measures for Airlines During the Pandemic

Christopher McMahon

European State Aid Law Quarterly, Volume 20 (2021), Issue 2, Page 249 - 257

During the pandemic, many Member States have engaged in more interventionist policies to sustain their economies through tough public health restrictions. This has manifested itself in the provision of large quantities of State aid to elements of the aviation industry by Member States, facilitated by the relatively permissive policies of the European Commission. The Irish low-cost airline Ryanair has been a notable and outspoken critic of these measures, describing them as ‘state aid crack cocaine’ and their beneficiaries as ‘state aid junkies’ and has launched an aggressive programme of litigation to annul the decisions approving the aid. This article reviews the first nine of the judgments of the General Court that this litigation has produced to date, three of which have led to the annulment of the Commission’s approval of the aid. This article will go on to assess the impact of these decisions and examine the contribution they make towards understanding the State aid response of the EU and its Member States to the pandemic. It will be suggested that the General Court has generally taken a tolerant attitude towards pandemic-related aid for aviation, upholding the approval of individual aid and allowing Member States to confine the aid to recipients with a close connection to their own economies. Keywords: COVID-19; Temporary Framework; aviation; non-discrimination.








Marcora for Europe: journal article

How Worker-Buyouts Might Help Save Jobs and Build Resilient Businesses

Tej Gonza, David Ellerman, Gregor Berkopec, Tea Žgank, Timotej Široka

European State Aid Law Quarterly, Volume 20 (2021), Issue 1, Page 61 - 73

The sector of small and medium-sized enterprises is lately under immense pressure due to restrictive governmental response to the COVID-19 pandemic. One of the dominant issues is concerned with financial liquidity – the threat is large-scale insolvency, job losses in thousands, and disappearance of businesses from local communities. There is a time-tested solution in Spain and Italy that provides liquidity to such enterprises in a democratic manner by establishing employee ownership schemes. In addition to saving businesses, employee-owned firms proved to provide more resilient business structures that better withstand crises. Despite the concerns that such an aid scheme meets the indications of a general prohibition of State aid and is thus illegal, the doubts were scattered by the Commission's decision which offered guidance and clarification. Based on good practice, we propose a universal model that could be legislated in most EU Member States. Keywords: COVID-19; SMEs; liquidity constraints; employee ownership; Marcora law; Unico law; economic policy proposal



The Corona Virus Can Infect Banks Too journal article open-access

The Applicability of the EU Banking and State Aid Regimes

Phedon Nicolaides

European State Aid Law Quarterly, Volume 19 (2020), Issue 1, Page 29 - 38

This paper examines possible options for Member States to redress the impact of the corona virus (SARS-CoV2) on financial institutions in the context of the directive on bank recovery and resolution, the regulation on the Single Resolution Mechanism and the State aid rules on banks. The EU banking regime requires, in principle, that the granting of State aid to a bank should lead to its resolution or liquidation. The paper considers how Member States may support banks outside the scope of Article 107(1) TFEU and how State aid may be granted without triggering resolution or liquidation. The current measures which are rolled out by European governments to support the real economy will indirectly benefit banks too. The paper reviews the recently announced ‘Temporary Framework’ according to which any ‘indirect aid’ to banks will not infringe the provisions of the directive or regulation. The paper identifies gaps in the current rules concerning solvent, but not systemic banks, ambiguities in the interpretation of the concept of ‘serious disturbance’ and unclear guidance as to how indirect aid may be minimised. Keywords: Bank resolution; Liquidation; Temporary Framework; COVID-19.