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Contents
- Preliminary Material
- The Editor and Contributors
- Preface to the Third Edition
- Note on Citation
- Contents
- Table of Cases and Decisions
- Alphabetical Table of EU Cases
- Numerical Table of ECJ/CJEU Cases
- Numerical Table of General Court Cases
- Alphabetical Table of EFTA Court Cases
- Alphabetical Table of Commission State Aid Decisions
- Numerical Table of Commission State Aid Decisions
- Decisions of the EFTA Surveillance Authority
- Decisions of the European Ombudsman
- Table of WTO Cases
- Table of ICSID Cases
- Table of National Cases
- Tables of Treaties and Legislation
- List of Abbreviations
- Main Text
- Part I General Rules
- 1 Introduction to State Aid Law and Policy
- Preliminary Material
- A General Themes of State Aid Control
- B Why Governments Grant State Aid
- C The Aims of EU State Aid Control
- D Implementing State Aid Policy
- 2 The Definition of State Aid
- Preliminary Material
- A Introduction
- B Economic Advantage
- Introduction.
- 1 The beneficiary of aid
- 2 Identifying the advantage: general principles
- Normal market conditions.
- Role of the State.
- State performing mixed functions.
- The EDF case.
- Comparator in same Member State.
- Contemporaneous comparison.
- Consideration of transaction as a whole.
- Ascertainability of advantage.
- Contingent advantage.
- Contingent advantage and general aid schemes.
- Exemption from unlawful charge.
- Contribution to aid.
- Relative advantages.
- Compensation for specific costs or disadvantages.
- Costs not justifying compensation.
- Compensation for damage caused by the State.
- Indemnities.
- Imposition of special charges.
- Burden and standard of proof.
- 3 Market economy operator principle
- Origins of principle.
- Basic principle.
- Burden of proof.
- Applications of the principle.
- State investments.
- Evidence of actual or comparable private investors.
- Financial indicators.
- Long-term profitability.
- State as existing shareholder.
- Developments in the market.
- Other factors to take into account.
- Expert evidence.
- 4 Loans and guarantees
- 5 Debt reduction
- 6 Land sales
- 7 Sale or supply of assets or services
- 8 Purchase of goods and services
- 9 Payments for public services
- The early debate.
- Altmark.
- Relationship with Article 106(2).
- First Altmark condition: clearly defined public service obligations.
- Market regulation.
- Examples.
- Second Altmark condition: objective parameters.
- Third Altmark condition: avoidance of overcompensation.
- Fourth Altmark condition: efficient undertaking comparator.
- 10 Challenges to tax charges
- C State Resources and Imputability
- Introduction.
- 1 Grants through ‘State resources’
- The historic debate.
- PreussenElektra.
- Cumulative interpretation of Article 107(1).
- Definition of State.
- Government funds and assets.
- Public and private undertakings.
- Parafiscal charges and similar levies.
- Private deposits.
- Direct or indirect grants.
- Tax exemptions and other waivers of tax revenue.
- Forgoing other revenues.
- Potential burdens on State resources.
- Payments by third parties.
- EU resources.
- 2 Imputable to the State
- D Selectivity
- Favouring certain undertakings or sectors.
- Problem areas.
- 1 The reference framework
- 2 Prima facie selective measures
- General test.
- Types of selectivity.
- Benefit to particular sectors.
- Selection by size or resources.
- Particular geographic regions.
- Public undertakings and public services.
- Selection by other criteria.
- Combination of measures.
- Discretionary administrative practices.
- Tax rulings and settlements.
- Favouring undertakings outside target group.
- General measures.
- Other examples.
- Non-comparability.
- 3 Measures justified by the nature or scheme of the system
- 4 Regional selectivity
- E Distortion of Competition and Effect on Trade
- F De minimis Aid
- 3 Compatibility of Aid—General Principles
- Preliminary Material
- A Introduction
- B Article 107(2)—Automatic Compatibility
- C Article 107(3)—Discretionary Compatibility
- Application of Article 107(3) in practice.
- Structure of this section.
- 1 General principles
- 2 Block exemptions
- 3 Guidelines
- 4 Article 107(3)(a)—regional aid
- 5 Article 107(3)(b)—aids to important projects and to remedy serious disturbances
- 6 Article 107(3)(c)—aid to promote the development of certain economic activities or of certain economic areas
- 7 Article 107(3)(d)—aid to promote culture and heritage conservation
- D Article 106(2) and Services of General Economic Interest
- 1 Overview
- 2 SGEI Decision
- 3 Cases falling outside the Decision
- SGEI Framework and other guidance.
- Burden of proof.
- Outline of conditions.
- First condition: existence of SGEI.
- Jurisdiction to define.
- Examples of SGEIs.
- Activities not accepted as SGEIs.
- Second condition: entrustment.
- Content of entrusting act.
- Third condition: necessity.
- Fourth condition: proportionality.
- Existence of overcompensation.
- Control of overcompensation.
- Fifth condition: development of trade.
- Compliance with EU procurement rules and Directive 2006/111.
- E Authorisation of State Aid by the Council
- 4 International Agreements
- Preliminary Material
- A Introduction
- B EEA Agreement
- C Accession to the European Union
- 1 Agreements prior to the 2004 and 2007 accessions to the EU
- 2 Stabilisation and Association Process
- 3 Other EU candidate countries
- D World Trade Organization
- 1 Background to GATT/WTO Subsidies Framework
- 2 General Framework of the SCM Agreement
- Scope.
- Definition of subsidy.
- Form of financial contribution.
- Concepts of government and public body.
- Government revenue ‘otherwise due’.
- Provision of goods/services, or purchase of goods.
- ‘Entrust or direct a private body’.
- Normal governmental conduct.
- Income or price support.
- Benefit.
- Market benchmarks.
- Privatisations.
- Requirement of specificity.
- De jure and de facto specificity.
- ‘Traffic light’ system.
- ‘Red light’ prohibited subsidies.
- ‘Yellow light’ actionable subsidies.
- ‘Green light’ permitted subsidies.
- WTO dispute resolution.
- Countervailing duties.
- Notification and transparency.
- 3 Agreement on Agriculture
- 4 WTO subsidy law and EU State aid law
- 5 WTO subsidy law and free trade agreements
- E EU State Aid Law and International Investment Treaties
- 1 Introduction to State Aid Law and Policy
- Part II Specific Types of Aid
- 5 The General Block Exemption Regulation
- 6 Regional Aid
- Preliminary Material
- A Introduction
- B Demarcation of Regions Under 2014–2020 Regional Aid Guidelines
- C General Block Exemption Regulation
- D 2014–2020 Regional Aid Guidelines
- 1 General principles
- 2 Compatibility assessment
- Contribution to a common objective.
- Common objective: investment aid schemes.
- Common objective: individual investment aid.
- Common objective: operating aid.
- Need for State intervention.
- Appropriateness of regional aid.
- Appropriateness: investment aid schemes/individual aid.
- Appropriateness: operating aid.
- Incentive effect.
- Incentive effect: investment aid schemes.
- Incentive effect: individual investment aid.
- Incentive effect: operating aid.
- Proportionality.
- Proportionality: investment aid.
- Proportionality: operating aid.
- Avoidance of undue negative effects on competition and trade.
- 3 Evaluation, reporting and monitoring
- 7 SME and Risk Finance Aid
- Preliminary Material
- A Introduction
- B Existence of Aid
- C General Block Exemption Regulation
- D Risk Finance Guidelines
- E Authorisation Directly Under Article 107(2) and (3)
- F Short-term Export-credit Insurance
- 8 Research, Development and Innovation
- Preliminary Material
- A Introduction
- B Existence of Aid
- C General Block Exemption Regulation
- D R&D&I Framework
- 9 Training and Employment Aid
- Preliminary Material
- A Introduction
- B Existence of Aid
- C General Block Exemption Regulation
- D Authorisation Under Article 107(3)
- 1 Training and Employment Communications
- 2 Authorisation under Article 107(3)(c) directly
- 10 Energy and Environmental Protection
- Preliminary Material
- A Introduction
- B Existence of Aid
- C General Block Exemption Regulation
- 1 General scope
- 2 Environmental and energy aid exemptions
- Aid for environmental protection beyond EU standards.
- Aid for early adaptation to future EU standards.
- Aid for energy efficiency measures.
- Aid for energy efficiency projects in buildings.
- Aid for high-efficiency cogeneration.
- Investment aid for renewable energy.
- Operating aid for renewable source electricity.
- Aid in the form of tax reductions.
- Investment aid for remediation of contaminated sites.
- Investment aid for energy efficient district heating and cooling.
- Investment aid for waste recycling and re-utilisation.
- Investment aid for energy infrastructure.
- Aid for environmental studies.
- D Environmental and Energy Aid Guidelines
- E ETS Guidelines
- F Stranded Costs
- G Nuclear Energy
- H Coal
- 11 Disaster Aid
- 12 Transport
- Preliminary Material
- A Introduction
- B Rail Transport
- C Road Transport
- D Inland Waterways
- E Intermodal Transport
- F Air Transport
- 1 Overview
- 2 Existence of aid
- 3 Investment and operating aid for airports
- GBER.
- Aviation Guidelines: common assessment principles.
- Contribution to an objective of common interest.
- Need for State intervention.
- Appropriateness of the aid.
- Incentive effect.
- Proportionality: investment aid.
- Proportionality: operating aid.
- Avoidance of undue negative effects on competition and trade.
- Aid schemes and individual aid.
- 4 Airline start-up aid
- 5 Disaster aid
- 6 Rescue and restructuring aid
- 7 Public service compensation and social aid
- G Maritime Transport
- 13 Media and Communications
- Preliminary Material
- A Introduction
- B Broadcasting
- C Broadband
- 1 Policy and legislative framework
- 2 Existence of aid
- 3 General Block Exemption Regulation
- 4 Authorisation under Article 106(2)
- 5 Authorisation under Article 107(3)
- Overview.
- Contribution to an objective of common interest.
- Market failures/inequalities and ‘white’, ‘grey’ and ‘black’ areas.
- Appropriateness of the aid.
- Incentive effect.
- Design and proportionality: basic conditions.
- Wholesale access to NGA networks.
- Ultra-fast broadband networks.
- Overall balance.
- Transparency and reporting.
- Examples.
- D Postal Services
- E Film and Audiovisual Sector
- 1 Policy and legislative framework
- 2 Existence of aid
- 3 General Block Exemption Regulation
- 4 Authorisation under Article 107(3)
- Article 107(3)(d) and film production.
- Scope of the Cinema Communication.
- Compatibility assessment.
- General legality principle.
- Territoriality.
- Cultural content.
- Aid intensity.
- Aid supplements related to production.
- Film preservation.
- Transparency.
- Article 107(3)(d) as stand-alone provision.
- Article 107(3)(c).
- 14 Culture, Heritage, Sport and Local Infrastructure
- 15 Rescue and Restructuring Aid
- Preliminary Material
- A Introduction
- B Existence of Aid
- C Rescue and Restructuring Guidelines: Basic Concepts
- D Specific Authorisation Criteria
- General.
- Contribution to an objective of common interest.
- Return to long-term viability.
- Need for State intervention.
- Appropriateness.
- Incentive effect.
- Proportionality.
- Own contribution.
- Burden sharing.
- ‘One time, last time’ principle.
- Exceptions to ‘one time, last time’ principle.
- Limiting distortions of competition (compensatory measures).
- Transparency.
- Restructuring aid in assisted areas.
- Aid to SGEI providers in difficulty.
- E Procedural Issues
- 16 Financial Services
- Preliminary Material
- A Introduction
- B Existence and Quantification of Aid
- 1 Existence of aid
- 2 Quantification of aid
- 3 Additional State measures to assisted undertakings
- C Compatibility of Crisis Aid
- 1 Overview
- 2 Funding guarantees
- 3 Liquidity measures
- 4 Recapitalisations
- Form and objectives.
- Applicable legislation.
- Preconditions to the grant of recapitalisation aid.
- Capital raising measures by the bank.
- Burden sharing by executives.
- Burden sharing by investors.
- Ex ante behavioural restrictions.
- Rescue recapitalisations.
- Remuneration: general principles.
- Benchmark rate for remuneration.
- Incentives for State capital redemption.
- Need for a restructuring plan.
- Recapitalisation schemes and ad hoc aid.
- 5 Impaired asset relief
- D Viability and Restructuring Plans
- 1 Overview
- 2 Restoring long-term viability
- 3 Own contribution/burden sharing
- 4 Limiting distortions of competition
- 5 Liquidation cases
- E Procedure and Implementation
- 17 Agriculture and Fisheries
- Preliminary Material
- A Introduction
- Definitions.
- Special application of the competition rules.
- Objectives of the common agricultural policy.
- The two pillars of the common agricultural policy.
- First pillar: market measures and direct payments.
- Second pillar: rural development.
- Market crisis measures.
- Relevant Directorate General.
- Overall framework of State aid rules in the agriculture and fisheries sectors.
- B Application of State Aid Rules in the Agriculture Sector
- C Agriculture De Minimis Exemption
- D Agriculture Block Exemption Regulation
- 1 General provisions
- 2 Specific categories of aid
- (a) Aid for SMEs active in primary agricultural production and the processing/marketing of agricultural products
- General conditions.
- Investments in tangible or intangible assets on agricultural holdings.
- Agricultural land consolidation.
- Relocation of farm buildings.
- Investments in connection with the processing and marketing of agricultural products.
- Start-up aid for young farmers and the development of small farms.
- Start-up aid for producer groups and organisations.
- Participation of producers in quality schemes.
- Knowledge transfer and information actions.
- Advisory services.
- Farm replacement services.
- Promotion measures in favour of agricultural products.
- Damage caused by adverse climatic events.
- Animal diseases and plant pests.
- Livestock sector and fallen stock.
- Insurance premiums.
- (b) Aid for the conservation of cultural and natural heritage
- (c) Aid to make good the damage caused by natural disasters
- (d) Aid for R&D
- (e) Aid for forestry
- General conditions.
- Afforestation and creation of woodland.
- Agroforestry systems.
- Forestry damage prevention and restoration.
- Investments improving the resilience and environmental value of forest ecosystems.
- Natura 2000 forest areas.
- Forest-environmental and climate services and forest conservation.
- Knowledge transfer and information actions.
- Advisory services.
- Investments in infrastructure.
- Investments in forestry technologies.
- Conservation of genetic resources in forestry.
- Forestry land consolidation.
- (f) Aid for SMEs in rural areas
- (a) Aid for SMEs active in primary agricultural production and the processing/marketing of agricultural products
- E Agriculture Guidelines
- 1 General provisions
- 2 Specific categories of aid
- (a) Rural development measures
- Rural development investment: general.
- Investments in tangible and intangible assets on agricultural holdings.
- Conservation of cultural and natural heritage.
- Investments concerning the relocation of farm buildings.
- Processing and marketing of agricultural products.
- Start-up aid for young farmers and for the development of small farms.
- Transfer of agricultural holdings.
- Start-up aid for producer groups and organisations.
- Agri-environment-climate commitments.
- Animal welfare commitments.
- Natura 2000 and Water Framework Directive areas.
- Areas facing natural or other specific constraints.
- Organic farming.
- Participation of producers in quality schemes.
- Knowledge transfer, advisory services and farm replacement services.
- Cooperation in the agricultural sector.
- (b) Risk and crisis management
- Aid compensating for damage to agricultural production: general.
- Natural disasters or exceptional occurrences.
- Disaster aid schemes.
- Adverse climatic events.
- Animal diseases, plant pests and fallen stock.
- Damage caused by protected animals.
- Insurance premiums.
- Financial contributions to mutual fund.
- Closing production capacity.
- (c) Other types of agricultural aid
- (d) Aid for forestry
- Aids for the forestry sector.
- Investments in forest area development: general conditions.
- Afforestation and creation of woodland.
- Agroforestry systems.
- Forestry damage prevention and restoration.
- Investments improving the resilience and environmental value of forest ecosystems.
- Investments in forestry technologies and infrastructure.
- Natura 2000 forest areas.
- Forest-environment and climate services and forest conservation.
- Knowledge transfer, information actions and advisory services.
- Cooperation in forestry sector.
- Start-up aid for producer groups and organisations.
- Other aid to the forestry sector with ecological, protective and recreational objectives.
- Aid in the forestry sector aligned with agricultural measures.
- (e) Aids in rural areas
- General conditions.
- Three types of investment aid.
- Basic services and village renewal in rural areas.
- Business start-up aid.
- Agri-environmental-climate commitments.
- Natura 2000 areas.
- Knowledge transfer and information actions.
- Advisory services.
- Quality schemes for cotton and foodstuffs.
- Cooperation in rural areas.
- Mutual funds.
- (a) Rural development measures
- F Fisheries
- Definition of fisheries and aquaculture products.
- General application of State aid rules.
- Legislative framework.
- De minimis exemption.
- GBER.
- Fisheries Block Exemption Regulation: scope.
- Fisheries Block Exemption Regulation: general conditions.
- Fisheries Block Exemption Regulation: categories of aid.
- Fisheries Guidelines: scope.
- Fisheries Guidelines: general conditions.
- Fisheries Guidelines: main categories of aid.
- Part III Enforcement and Remedies
- 18 Supervision by the Commission
- Preliminary Material
- A Overview of Commission Procedure
- 1 Legislative framework
- 2 The different State aid procedures
- 3 Types of aid that must be notified
- 4 Distinction between new and existing aids
- New and existing aid.
- Categories of existing aid.
- Aid existing on accession: first 12 Member States.
- Aid existing on accession: next 16 Member States.
- Authorised aid schemes and individual aid.
- Deemed authorisation.
- Expiry of limitation period.
- Evolution of the internal market.
- Alteration of existing aid.
- Severability of alterations to aid scheme.
- 5 General notification requirements
- 6 Handling of State aid cases within the Commission
- B Simplified Procedure
- C Normal Preliminary Review Procedure
- 1 Scope and notification
- 2 The Commission’s investigation
- Preliminary examination of the measure.
- Standstill requirement during procedure.
- Rights of Member States.
- Rights of third parties (including beneficiaries and complainants).
- Requests for information.
- Two-month time limit.
- ‘Complete’ notification.
- Limited scope of the preliminary review procedure.
- Proving ‘serious difficulties’.
- Length of the procedure.
- Completeness of contested decision.
- Other factors.
- 3 Decisions following preliminary review
- D Formal Investigation Procedure
- 1 Opening the procedure
- 2 The Commission’s investigation
- 3 The final decision
- Overview of possible decisions.
- ‘No aid’ and positive decisions.
- Conditional decision.
- Deggendorf condition.
- Non-compliance with conditions.
- Negative decision.
- Time limit for compliance.
- Case closure where decision devoid of purpose.
- Notification and publication of decisions.
- Reopening a formal investigation.
- 4 Revocation and annulment
- E Unlawful and Misused Aid
- Overview of procedure.
- Unlawful and misused aids: procedural differences.
- 1 The investigation of unlawful or misused aids
- 2 Interim measures
- 3 Decisions in respect of unlawful or misused aid
- 4 Recovery of aid
- 5 Defences (and non-defences) to recovery
- F Existing Aid and Sector Inquiries
- G Evaluation, Monitoring and Compliance
- H European Ombudsman
- 19 Enforcement in the European Court
- Preliminary Material
- A Introduction
- B Actions Against Member States
- C Actions for Annulment of Decisions
- 1 Introduction
- 2 Challengeable acts
- 3 Standing
- (a) Privileged applicants
- (b) Non-privileged applicants: general principles
- Overview of criteria.
- Regulatory act that does not entail implementing measures.
- Multiple applicants.
- Interest in annulment.
- Continuing interest.
- Direct concern.
- Individual concern.
- Challenge to decision not to raise objections.
- Merits challenge.
- Relevant factors in applying the Plaumann test.
- Evidence of substantial effect on competitive position.
- Mixed procedural and merits challenge.
- Availability of other remedy irrelevant.
- Relevant stage of proceedings.
- (c) Specific categories of applicants
- 4 Timing of actions for annulment
- 5 Grounds of review
- (a) Overview
- (b) Error of law
- (c) Infringement of procedural rights
- (d) Manifest error of assessment
- (e) Reasoning
- (f) Misuse of powers
- 6 Consequences of annulment
- D Action for Failure to Act
- E Action for Damages
- F Appeals to the CJEU
- G Overarching Procedural Matters
- 20 Enforcement in the National Courts
- Preliminary Material
- A Introduction
- B Interpretation and Effect of Article 108(3)
- C Domestic Remedies and Enforcement Action
- 1 Challenging the validity of national measures
- 2 Recovery of aid
- Recovery as the normal consequence of breach of Article 108(3).
- Recovery prior to Commission decision.
- Recovery following negative decision.
- Recovery following approval decision.
- Approval subsequently annulled by the Court.
- CELF I.
- CELF II.
- Defences to recovery.
- Recovery and aid schemes.
- Method of recovery.
- Recovery procedure in the UK.
- Procedural errors in national recovery orders.
- 3 Reimbursement of taxes or charges
- 4 Damages claims
- 5 Other domestic actions
- 6 National court procedure
- D Interaction with European Court and Commission
- 18 Supervision by the Commission
- Part I General Rules
- Further Material