The Austrian Higher Regional Court of Vienna remands a State aid case to back the lower court after ruling that where a recipient of a State-backed loan does not meet the criteria for that loan the aid may be illegal and the State may legitimately renege on its contractual obligations (Alpine)

Background & Facts of the case In order to mitigate the effects of the financial and economic crisis of 2008, the Austrian legislator adopted the so-called Unternehmensliquidationsstärkungsgesetz (Law on strengthening the liquidity of companies, hereafter the “ULSG“). [1] It authorised the Federal Minister of Finance to assume guarantees for loans taken out by Austrian companies of certain importance for the national economy. The aim was to ensure the maintenance of their business activities and the bridging of temporary liquidity shortages. [2] One of the conditions for granting the guarantees was that the companies concerned had to have a sound economic basis before the reference date of 1 July 2008, combined with the requirement that there had to be a positive prospect of the

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  • University of Vienna (Vienna)

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Julia Zöchling, The Austrian Higher Regional Court of Vienna remands a State aid case to back the lower court after ruling that where a recipient of a State-backed loan does not meet the criteria for that loan the aid may be illegal and the State may legitimately renege on its contractual obligations (Alpine), 26 February 2018, e-Competitions March 2018, Art. N° 106604

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