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Transport Companies Are Entitled to Compensation for Public Service Obligations Imposed by General Rules · Case C‑614/20 Lux Express Estonia · Annotation by Benjamin Linke journal article

Annotation on the Judgment of the Court (First Chamber) of 8 September 2022 in Case C‑614/20 Lux Express Estonia

Benjamin Linke

European State Aid Law Quarterly, Volume 21 (2022), Issue 4, Page 419 - 424

It has been controversial for years whether transport companies were entitled to compensation for the burden of tariff obligations imposed by competent authorities. The ECJ has now granted the transport companies a claim derived from Regulation (EC) No 1370/2007. In view of the political discussions about compensation obligations in the legislative process for the Regulation, this comes as a surprise. Henceforth, however, companies will be entitled to compensation for all negative effects (less all positive effects) of maximum tariffs imposed outside public service contracts through so called general rules.

New Methodology to No Avail? journal article

A Review of the European Commission’s Case Practice Regarding the Net Avoided Cost Methodology Following the 2012 SGEI Package

Mikael K. Lund

European State Aid Law Quarterly, Volume 20 (2021), Issue 2, Page 229 - 239

Seeking to improve cost estimates for services of general economic interest (SGEI), the European Commission in the 2012 SGEI package introduced the new net avoided cost (NAC) methodology for calculating the cost of such services. This article conducts a comprehensive review of the Commission’s case practice with respect to the application of the NAC methodology. The review shows that the Commission has a low threshold for what is considered a ‘duly justified’ reason for not using the NAC methodology. First, the Commission has held that the undertaking performing the SGEI must be known in advance. This effectively means that it cannot be used in conjunction with tenders or public procurement. In practice, the NAC methodology can only be applied where the undertaking is already engaged in the activity in question. Second, the Commission has implicitly established two criteria for when a relevant counterfactual scenario can be defined. These criteria are interpreted strictly, effectively restricting the application of the NAC methodology to very few cases not already covered by sector specific regulation. The implication of these findings is that the introduction of the NAC methodology did not contribute anything substantial to SGEI regulation. Keywords: services of general economic interest; SGEI compensation; public service compensation; net avoided cost; NAC methodology.

Public Aid to Airports as a Compensation for the Provision of Services of General Economic Interest journal article

Michele Giannino, Federich Romby

European State Aid Law Quarterly, Volume 17 (2018), Issue 3, Page 338 - 352

The purpose of this article is to provide a comprehensive review of the European Commission’s approach in assessing whether compensation awarded to airports for the provision of Services of General Economic Interest (SGEIs) complies with the EU State aid rules. The article analyses the defensive strategies open for national authorities to claim that airports public service compensation packages are compatible with the internal market. In that regard, the article considers the Altmark doctrine and the compatibility conditions for the application of the SGEI exception in Article 106 TFEU. Then it critically compares the strong and weak points of each of these strategies and also dwells on which factors national authorities have to adduce to prove the compatibility of airport aid. Bearing in mind the difficulties for national authorities to satisfy all the conditions for the application of the Altmark doctrine, the article suggests that the SGEI exception should be the optimal strategy to obtain regulatory clearance of public service compensation to airport.

ARTICLES - STATE AID AND NATIONAL JURISDICTIONS ∙ The Altmark Case Revisited: Local and Regional Subsidies to Public Services journal article

Erika Szyszczak

European State Aid Law Quarterly, Volume 16 (2017), Issue 3, Page 395 - 407

The evolution of the State aid rules has made incursions into the sovereignty of the Member States to identify, fund and operate public services (SGEI). This sensitive issue tends to be managed by the European Commission with few cases brought before the national courts or referred to the CJEU. Nevertheless, national courts may be faced with a growing number of challenges in understanding and applying the European Commission policy and the European Courts’ case law in this area. The article provides an overview of some of the recent policy developments and case law to highlight the legal complexities of applying State aid to public services. Keywords: SGEI; Altmark; Public Services; National Courts.

France/SNCM v European Commision  ∙ Cases T-366/13 and T-454/13 ∙ Annotation by Adrien Giraud journal article

Adrien Giraud

European State Aid Law Quarterly, Volume 16 (2017), Issue 3, Page 482 - 486

On 1 March 2017, the General Court confirmed a decision by which the European Commission ordered France to recover €220 million from SNCM. In practice, the judgment has little consequences because of SNCM’s bankruptcy. From a legal standpoint however, the judgment is significant because it refuses to endorse the Commission’s thesis according to which Member States must in all cases evidence a market failure in order to correctly define a SGEI. In other words, the Commission attempted to increase the scope of the control it performs on the definition of SGEIs and the GC – as it has sometimes in the past – refused to condone this approach. Keywords: Altmark; SGEI; Market Failure; Public Service.

Is There a Role for Economic Analysis When Deciding on State Aid to Public Broadcasters? journal article

Caroline Buts, Mychal Langenus, Karen Donders

European State Aid Law Quarterly, Volume 16 (2017), Issue 4, Page 537 - 558

By means of text analysis, this article examines the use of economic concepts and tools in State aid decisions regarding public broadcasters. We find that broad and general concepts are most frequently used and that more specific economic terms that can be found in the Broadcasting Communication surface rather seldomly in the public version of decision texts. Furthermore, we do not observe a substantial difference between the use of these terms before and after the adoption of the v2009 Broadcasting Communication suggesting that economic concepts are not more frequently used in recent years. We believe that economic analysis could bring additional clarity and support in several of the studied decisions, especially in cases where, for example, it is quite debatable which tasks fall under a public service obligation and which do not. Economic analysis would foster the evolution to a stricter and more rational State aid control in this exceptional sector preventing potential spillover-effects of aid into new activities. Keywords: State Aid; Media; Public Service Broadcasting; Economic Analysis.

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