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Case T-131/16 RENV Belgium v Commission · Annotation by Julie Leroy journal article

Annotation of the Judgment of the General Court (Second Chamber, Extended Composition) of 20 September 2023 in Case T-131/16 RENV Belgium v Commission

Julie Leroy

European State Aid Law Quarterly, Volume 23 (2024), Issue 2, Page 206 - 211

The Excess Profit Ruling-saga goes all the way back to 2016, when the European Commission opened its formal investigation into the alleged aid scheme. More than seven years and several judgments later, the General Court concludes that the Commission correctly decided that the Belgian State granted unlawful (and incompatible) State aid through the Excess Profit Ruling-scheme. In the annotated judgment, the General Court focuses extensively on the selectivity analysis. The core of its analysis lies in the argument that the Advance Ruling Commission, when granting an Excess Profit Ruling, did not apply the rules on profit adjustments contained in the corporate income tax system (more precisely Article 185(2)(1)(b) of the 1992 Code on Income Taxation). This deviation from the reference system led, according to the Commission and the General Court, to a selective advantage. After discussing the judgment, an outlook on the continuation of the saga is given, focusing both on the appeal against the annotated judgment and on the faith of the individual investigations into Excess Profit Rulings.


The Fiat Case and a Judicial Epilogue in the Tax Rulings Saga · Joined Cases C-885/19 P, C-898/19 P Fiat Chrysler Finance Europe v Commission · Annotation by Theodoros G. Iliopoulos journal article

Annotation on the Judgment of the Court of Justice of 8 November 2022 in Joined Cases C-885/19 P and C-898/19 P Fiat Chrysler Finance Europe v Commission

Theodoros G. Iliopoulos

European State Aid Law Quarterly, Volume 22 (2023), Issue 2, Page 188 - 192

On 8 November 2022, the Court of Justice (appellate body) published its judgment in Joined Cases C‑885/19 P and C‑898/19 P that dealt with the tax ruling that Luxembourg had granted to the group Fiat Chrysler Finance Europe. The judgment annulled the Commission’s 2015 decision that found that the granting of this tax ruling constitutes illegal State aid and required Luxembourg to recover the incompatible and unlawful aid. With this judgment, the concept of ‘selectivity’ in State aid, at least with regards to tax measures, is delineated, and it is revealed to be narrower than it seemed. The arm’s length principle does not form part of State aid law, unless national law gives a concrete expression to it, and the Commission can only rely upon the principle of non-discrimination to assess the national rules that establish and determine the application of the arm’s length principle. This is the judicial epilogue of the Fiat case and of the saga of the tax rulings – unless the exact delineation of the powers of the Commission opens a new chapter in the future.




How Much Could the US Inflation Reduction Act Cost Europe? journal article

Eszter Hargita, Filip Puzder, Péter Staviczky

European State Aid Law Quarterly, Volume 22 (2023), Issue 3, Page 242 - 266

The Inflation Reduction Act (IRA) was introduced in the US in August 2022, aiming to promote investments into clean energy production. The IRA provides huge amount of aid, which can have a draining effect of green investments vital for the green transition of the European economy. In response, the Commission adopted Temporary Crisis and Transition Framework (TCTF) in March 2023. As well as explaining the historical context and content of these subsidy-rules, this article makes an attempt to compare the subsidies available under the IRA and the TCTF, considering the maximum aid amount available under the regional aid guidelines. Keywords: Inflation Reduction Act; IRA; subsidy competition; incentive effect; operating aid; battery manufacturing; tax credit


The Analogous Application of State Aid Law to Asymmetric Taxes journal article

Can the Imposition of a Special Charge Be State Aid Within the Meaning of Article 107(1) TFEU?

Lars Mörmel

European State Aid Law Quarterly, Volume 22 (2023), Issue 3, Page 267 - 275

Narrow-scoped special charges imposed by Member States on certain undertakings can have an effect that is as distorting on competition as tax exemptions. However, the wording of Article 107(1) of the Treaty on the Functioning of the European Union (TFEU) does not allow for a direct application of State aid rules in these cases; neither is it possible to treat special charges as a form of far-reaching tax exemption for unaffected undertakings. Despite its practical significance, the Court of Justice of the European Union (CJEU) has failed so far to address the issue appropriately. This article critically examines the relevant case-law and calls for a methodological re-orientation. In the absence of other legal instruments to deal with the problem and in light of the potential for Member States to circumvent State aid rules through special charges, Article 107(1) TFEU should, in extension of its literal scope of application, be applied to special charges by way of analogy. This would lead to more legal clarity and certainty for both lawmakers and affected undertakings. Keywords: special charges; asymmetrical taxes; negative State aid; analogous application


Spanish Goodwill – A Textbook on Material Selectivity Awaiting a Second Edition journal article

Andreas Bartosch

European State Aid Law Quarterly, Volume 21 (2022), Issue 1, Page 65 - 71

The Spanish Goodwill saga which has covered more than a decade of fluctuating litigation before the EU Courts has certainly made many of the different shades of the notion of material selectivity visible, some of which it moulded, some of which it re-affirmed. In this it will certainly go down in State aid history as a remarkable piece of jurisprudence. What it has not managed, glady so, is to end the magical mystery material selectivity surrounds itself with. And the latter is very much a blessing to our future debates and discussions.Keywords: Spanish Goodwill; material selectivity; taxMilestones Preview: this article is based on a chapter in the upcoming second edition of the book 'Milestones in State Aid Case Law' (Lexxion 2022).


Magnetrol v Commission: When Do Advance Tax Rulings Become an Aid Scheme under Article 1(d) Regulation (EU) 2015/1589 · Case C-337/19 P Magnetrol v Commission · Annotation by Benedikt Freund and Moritz Seiler journal article

Annotation on the Judgment of the Court (Fourth Chamber) of 16 September 2021 in Case C-337/19 P Commission v Belgium and Magnetrol

Benedikt Freund, Moritz Seiler

European State Aid Law Quarterly, Volume 21 (2022), Issue 3, Page 302 - 309

In its decision of 14 February 2019, the General Court declared that the Commission had wrongly classified the Belgian ‘excess profit exemption system’ as an aid scheme according to Article 1(d) of Regulation 2015/1589. Allowing the Commission’s appeal, the Court of Justice found that the concept of an aid scheme according to Article 1(d) of Regulation (EU) 2015/1589 also encompassed a consistent administrative practice of a Member State tax authority. As a result, even where a Member State’s tax legislation itself is in compliance with State aid rules, the Commission is now in a position to establish the existence of an aid scheme, rather than having to prosecute every case individually, if a Member State tax authority has issued a significant number of (advance) tax rulings that deviate from its compliant legislation. After a series of mixed results in tax-related State aid cases, Magnetrol represents an important win for the Commission. We anticipate that its impact will be most pronounced in Member States where a single central authority is in charge of issuing tax rulings and tax collection (centralised model of tax administration).