The EU Court of Justice clarifies the concept of "existing aid" in a private enforcement case and holds that unlawful aid cannot be retroactively legalised under a limitation period that has lapsed (Fallimento Traghetti del Mediterraneo)

On January 23, 2019, the European Court of Justice (hereinafter the “Court” or the “ECJ”) handed down a preliminary ruling on the notion of “existing aid”. [1] The Court held, in particular, that the circumstance where a new aid that becomes existing aid by virtue of the 10 years limitation period has lapsed (Articles 1(b)(iv) and 15 in Regulation No 659/1999 [2] – now Articles 1(b)(iv) and 17 of Regulation No 2015/1589, [3] hereinafter the ‘Procedural Regulation’), cannot have the effect of retroactively legalizing State aid granted in breach of Article 108(3) TFEU. Any other interpretation would deprive of legal basis an action for damages brought by competitors of the State aid beneficiaries. The reasoning of the Court is logical and provides welcome clarifications on two provisions

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