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Inextricably Linked? The Limits of a State Aid Inquiry · Case T-101/18 Republic of Austria v European Commission (Paks II) · Annotation by Tamás Kende and Gábor Puskás journal article

Annotation on the Judgment of the General Court of 30 November 2023 in Case T-101/18 Republic of Austria v European Commission (Paks II)

Tamás Kende, Gábor Puskás

European State Aid Law Quarterly, Volume 22 (2023), Issue 2, Page 205 - 211

Article 107(3)(c) TFEU requires a delicate balancing of the positive effects of the aid aiming the development of certain economic activities and the negative effects thereof. The Paks II judgment provides clarifications as to the limits of this balancing process and the European Commission’s obligations to take into account primary and secondary EU laws other than those related to State aid, as well as fundamental goals of the EU Treaties like the protection of environment. The Paks II judgment also confirms that State aid rules are also applicable concerning activities falling under the EURATOM Treaty and clarifies the relationship between State aid and public procurement and an infringement procedure and a State aid procedure. The Paks II judgment also shows that Member States have a hard time with challenging the Commission’s State aid decisions if they rely on an alleged err in law or they attack the Commission’s discretionary powers and the proper application thereof.

Article 346(1) TFEU and Strategic Autonomy: journal article

A Possible Loophole to Grant State Aid in the Context of Geopolitical Struggles?

Wout De Cock, Gregory Kegels, Caroline Buts, Cind Du Bois

European State Aid Law Quarterly, Volume 22 (2023), Issue 2, Page 150 - 160

The current geopolitical situation has led to various calls for investment in Europe’s strategic autonomy, for example with regard to the defence and security sector. However, the possibility for Member States to grant financial support is restricted by EU State aid law, leading some stakeholders to argue that there is a friction between the geopolitical need to invest in Europe’s strategic autonomy on the one hand, and EU State aid law on the other. In this contribution, we examine whether Member States could avoid and/or alleviate this friction by invoking Article 346(1)(b) TFEU. This Treaty provision, often overlooked by legal scholars, stipulates that Member States may, in principle, take all measures they consider necessary for the protection of their essential security interests, without having to consider EU State aid law. By analysing relevant case-law of the EU Courts, however, we argue that the aforementioned Treaty provision has a limited scope, and that, therefore, Member States, in principle, must comply with the EU State aid rules when they contribute to Europe’s strategic autonomy. Keywords: Article 346(1)(b) TFEU; (open) strategic autonomy; investments; essential security interests; dual-use goods; R&D; defence sector

Procedural Rights of Aid Beneficiaries in State Aid Proceedings: The Case of Helsingin Bussiliikenne Oy · Cases T-597/19 and T-603/19 Helsingin Bussiliikenne Oy · Annotation by Ilkka Aalto-Setälä, Henrik J. Koivuniemi and Leo Rantanen journal article

Annotation on the Judgments of the General Court of 14 September 2022 in Case T-597/19 Helsingin kaupunki v Commission and Case T-603/19 Helsingin Bussiliikenne v Commission

Ilkka Aalto-Setälä, Henrik J. Koivuniemi

European State Aid Law Quarterly, Volume 21 (2022), Issue 4, Page 449 - 452

The Finnish State aid saga in the bus transport sector has become to a provisional end, as the General Court found in Cases T-597/19 and T-603/19 that certain measures taken by the City of Helsinki constituted unlawful State aid. The judgement showcases various interesting aspects of State aid law, particularly procedural rights of interested parties in the context of economic continuity. This annotation introduces the procedural matters at issue in Case T-603/19 and walks through the Court’s reasoning.

When State Aid Goes Wrong: journal article

Member State’s Liability Towards the Aid Beneficiary – A Belgian Case Study

Julie Leroy

European State Aid Law Quarterly, Volume 21 (2022), Issue 4, Page 384 - 396

A Member State which violates the standstill-obligation under Article 108(3) TFEU is not directly held responsible for his failure to comply with his obligations under EU law, as it is the aid beneficiary who will be obliged to repay the unlawful (and incompatible) State aid. This contribution evaluates if the aid beneficiary can nevertheless hold the Member State somehow responsible, through a damage claim based on the latter’s extra-contractual liability for the violation of EU law. The Belgian case study shows that such a claim can be successful, as the conditions of Articles 1382-1383 Old Civil Code might be fulfilled. However, the aid beneficiary is in a difficult position. One the one hand, this undertaking bears the ‘risk of proof’. On the other hand, a full compensation will be rare as, amongst others, the aid beneficiary’s own fault might lead to a liability apportionment. Finally, the obligation to repay the unlawful State aid (with interest) as such will never qualify as a damage that is eligible for a compensation, as this would undermine the effectiveness of EU law. Keywords: Article 108(3) TFEU; standstill-obligation; recovery of unlawful (and incompatible) State aid; liability of Member States; Belgium

Not Quite Final: journal article

Principle of Res Judicata in National Judicial Proceedings in the Area of State Aid

Łukasz Stępkowski

European State Aid Law Quarterly, Volume 21 (2022), Issue 4, Page 397 - 411

This article addresses the principle of res judicata in the context of rules on State aid, including the case-law of the Court of Justice and the 2021 Commission Notice on the enforcement of State aid rules by national courts. The limits of the principle at issue required by Article 108(3) TFEU and the powers of national courts to recover unlawful aid (with or without a recovery decision from the Commission) are discussed. The law is stated as it stood on 1 January 2022 (with some later developments). The case-law on res judicata referred to here includes the decisions of the Court in Lucchini, Klausner Holz, and CSTP/Buonotourist, with commentary on the practical effect of the Court’s approach. Keywords: Lucchini; Klausner Holz; res judicata; Article 108(3) TFEU; national courts

Shedding Light into the ‘Black Box’ of State Aid: journal article

The Impact of Hinkley Point C on the Assessment of the Compatibility of State Aid

Phedon Nicolaides

European State Aid Law Quarterly, Volume 20 (2021), Issue 1, Page 4 - 14

The article argues that the judgment of the Court of Justice in case C-594/18 P Austria v Commission, which appeared to limit the criteria that the Commission uses to determine the compatibility of State aid, may have a positive impact on State aid control if it makes the assessment of the Commission more transparent. There is a need for greater transparency in the ‘weighing’ of the positive and negative effects of State aid and the ‘balancing’ of those effects. The weighing and balancing of the effects of State aid are not easy tasks. But it will be necessary for the Commission to be more explicit about the model it relies on to conclude that aid is compatible or not. Keywords: Article 107(3)(c) TFEU; compatibility with internal market; common interest; affectation of trade; distortion of competition; Hinkley Point C

Environmental Protection: Contributions Channeled by Eco-Body Should not Involve the Transfer of State Resources · Case C-556/19 ECO TLC · Annotation by Sylvain Petit journal article

Annotation on the Judgment of the Court of Justice of the European Union (First Chamber) of 21 October 2020 in Case C-556/19 ECO TLC contre Ministre d’État, ministre de la Transition écologique et solidaire, Ministre de l’Économie et des Finances

Sylvain Petit

European State Aid Law Quarterly, Volume 20 (2021), Issue 1, Page 139 - 143

On 21 October 2020, the Court of Justice of the European Union (CJEU) handed down a preliminary ruling on the notion of ‘State resources’ regarding the French increased responsibility scheme for producers of waste from textile products, household linen and footwear products (TLC products). The CJEU ruled that a system set up by the State whereby producers of TLC products pay financial contributions to an eco-body which then enters into an agreement with sorting operators and provide them financial support for the recycling and treatment operations of the waste, may not constitute an intervention through State resources. This ruling emphasizes that the notion of ‘public control’ lies in the details: a range of circumstantial evidences is required to determine the extent of the public oversight over the funds channelled between private operators.

Implementation of the Green Deal: journal article

Integrating Environmental Protection Requirements into the Design and Assessment of State Aid

Simone Lünenbürger, Clemens Holtmann, Juliette Delarue

European State Aid Law Quarterly, Volume 19 (2020), Issue 4, Page 418 - 429

The Commission has announced its intention to revise a series of State aid rules (GBER and a number of guidelines) in light of the Green Deal by the end of 2021. At the same time, the Commission is examining how competition policy can be more effective to combat climate change and contribute to the protection of the environment. This article demonstrates that environmental protection requirements can and must be integrated into the definition and implementation of the Union's State aid policy, not only when it comes to environmental aid. Article 11 TFEU provides for a legal obligation on the Commission to integrate environmental protection requirements into the definition and implementation of Union policies, including State aid policy. It is shown how this obligation can be integrated into the traditional assessment scheme, notably under Article 107 (3)(c) TFEU and how it can be broken down into concrete compatibility assessment criteria. Keywords: Green Deal; environmental protection; Article 11 TFEU; State aid policy; guidelines

Commission’s Decisional Practice on State Aid to Railway Companies for Transport Coordination journal article

Germano Guglielmi, Stefania Bello

European State Aid Law Quarterly, Volume 19 (2020), Issue 3, Page 297 - 313

The concept of coordination of transport set forth by Article 93 TFEU is actually very vague. The Railway Guidelines provide guidance and criteria for the interpretation of this concept and the direct application to railway undertakings of Article 93 TFEU. This article focuses on the Commission Decisions concerning transport coordination, which directly or indirectly concern railway transport. In particular, the research aims at reconstructing State aid measures adopted between 2008 and 2019, assessed by the Commission pursuant either to Article 93 TFEU or to both Article 93 TFEU and the Railway Guidelines. The main purposes of this article are, firstly, to analyse how the Commission applied and interpreted this specific exception and, secondly, to assess whether the Railway Guidelines are sufficiently exhaustive or, on the contrary, they should be updated and/or extended in light of a potential revision under evaluation by the Commission. Keywords: transport coordination, Article 93 TFEU, Railway Guidelines