State aid & Public procurement

State Aid

The EU Council announces its fifth round of sanctions on Russia following aggression in Ukraine, including a prohibition on State aid to firms where there is at least 50% Russian public ownership and the firm continues to operate in Russia
DalDeWolf (Brussels)
,
Arendt & Medernach (Luxembourg)
Restrictive measures against individuals The Council adopted restrictive measures against an additional 217 individuals. These include Russian high-net-worth individuals, high-ranking Kremlin officials, individuals responsible for disinformation and information manipulation, as well as family (...)

The EU Commission approves an Austrian scheme worth €2B under the Recovery and Resilience Facility to support the roll-out of broadband networks
European Commission - DG COMP (Brussels)
State aid: Commission approves €2 billion Austrian scheme under Recovery and Resilience Facility to support roll out of broadband networks* The European Commission has approved, under EU State aid rules, a €2 billion Austrian aid scheme made available through the Recovery and Resilience Facility (...)

The EU Commission in two separate decisions clears Italian public support for a ferry service and closes the investigation on another ferry service that has since been put into liquidation (Laziomar) (Saremar)
European Commission - DG COMP (Brussels)
State aid: Commission clears Italian public support for Laziomar ferry service; closes investigation concerning support to Saremar* The European Commission has concluded that the public service compensation granted since 2011 to Laziomar S.p.A. (‘Laziomar’) for the operation of ferry services in (...)

The EU Commission clears public support for several ferry services in Italy but finds other measures to be incompatible with State aid rules (Siremar / Società Navigazione Siciliana)
European Commission - DG COMP (Brussels)
State aid: Commission clears public support for several ferry services in Italy; finds other measures to Siremar and SNS to be incompatible aid* The European Commission has concluded that the public service compensation granted since 2009 to Sicilia Regionale Marittima S.p.A. (‘Siremar’) and (...)

The EU Court of Justice dismisses the appeal against the General Court’s judgment highlighting that essential national interests may justify deviation from the normal public procurement procedure (Achemos & Achema)
Maastricht University
State Aid and Essential National Interest* Introduction State aid should support outcomes that the market by itself cannot achieve. This implies that State aid that is restricted to only one or a few undertakings is unlikely to be capable of delivering the desired outcome. Yet, sometimes (...)

The EU Commission decides that incompatible aid was granted by the Estonian Ministry of Rural Affairs to a private company that produces milk, meat, and cereals (Tartu Agro)
Maastricht University
Lease Contracts and Competitive Selection* Introduction After receiving a complaint, the Commission opened a formal investigation into alleged State aid granted by the Estonian Ministry of Rural Affairs to AS Tartu Agro, a private limited company, which produced milk, meat and cereals. (...)

The EU Commission decides that a State guarantee can bridge the funding gap of an infrastructure project in the energy sector (ETYFA)
Maastricht University
State Guarantee to an Energy Project* A state guarantee can bridge the funding gap of an infrastructure project. Introduction State aid rules allow energy infrastructure projects to be supported by as much aid as is necessary to bridge their “funding gap”; i.e. the difference between the (...)

The EU Commission approves a competitive tender mechanism to compensate for the early closure of hard coal-fired power plants in Germany
European Commission - DG COMP (Brussels)
State aid: Commission approves competitive tender mechanism to compensate for early closure of hard coal-fired power plants in Germany* The European Commission found that a competitive tender mechanism introduced by Germany to compensate hard coal-fired power plants for phasing out earlier (...)

The EU General Court reaffirms the Commission’s decision declaring illegal the aid from Italy to several airlines serving Sardinia (Volotea / Germanwings / EasyJet)
General Court of the European Union (Luxembourg)
The General Court dismisses the actions against the Commission decision declaring illegal the aid from Italy to several airlines serving Sardinia* The operators of the Sardinian airports were not the beneficiaries of the aid but merely intermediaries between the Autonomous Region and the (...)

The Ukrainian Supreme Court upholds the decision of the Competition Authority and rules that in State aid cases the Authority does not have to analyze the effect of aid on trade within the EU (Vinnytsya Transport Company)
Baker McKenzie (Kyiv)
,
Redcliffe Partners (Kyiv)
The Ukrainian Supreme Court concludes that in state aid cases the Antimonopoly Committee of Ukraine does not have to analyse the effect of aid on trade between Ukraine and the EU* On 31 March 2020, the Ukrainian Supreme Court (the “Supreme Court“) upheld the first decision of the Antimonopoly (...)

The EU Commission opens an in-depth investigation into public service delegation contracts for maritime services which potentially constitute State aid in Corsica (Corsica Linea)
European Commission - DG COMP (Brussels)
State aid: Commission launches in-depth investigation into public service delegation contracts for maritime services to Corsica* The European Commission has launched an in-depth investigation to determine whether the public service delegation contracts for maritime services to Corsica awarded (...)

The EU Commission decides that the scheme used for the construction of a sustainable irrigation system does not constitute State aid (Bavaria)
Maastricht University
Public Funding of Infrastructure without State Aid* Introduction Public funding of infrastructure does not constitute State aid if access to the infrastructure is free for all users on non-discriminatory terms. If, by contrast, access to the infrastructure is restricted or it is designed for (...)

The EU Court of Justice provides further guidance on how economic activities linked to non-economic functions must be treated in a State aid context (Aanbestedingskalender)
Maastricht University
SEPARABILITY OF ECONOMIC FROM NON-ECONOMIC ACTIVITIES* Introduction Pure research whose results are widely disseminated is undoubtedly a non-economic activity. Research reports are often published on the internet. But the design and management of a research organisation’s website can be an (...)

The EU Court of Justice upholds the Commission’s decision finding that e-procurement is a service of general interest which can be commercially exploited insofar as the State does not offer the service itself (TenderNed)
University of Bristol - Law School
In its Judgment of 7 November 2019 in Aanbestedingskalender and Others v Commission, C-687/17 P, EU:C:2019:932 (the ‘TenderNed’ case), the Court of Justice of the European Union (CJEU) rejected the appeal against the earlier Judgment of the General Court (GC) of 28 September 2017 (T-138/15, (...)

The EU Commission concludes that State aid in the Italian postal service market is compatible with Article 106 TFEU (Poste Italiane)
Maastricht University
How to Compensate for the Extra Cost of Public Service Obligations: Step-by-Step Guidance on a Complex Calculation* Introduction The two most difficult issues in the design of State aid measures to support services of general economic interest [SGEI] are the proper definition of the public (...)

The EU Commission decides that bus transportation provided by public authorities constitutes economic activity (Helsingin Bussiliikenne)
Maastricht University
Helsinki Busses, Loans, Article 93 and Indemnification* Bus transportation provided by public authorities constitutes economic activity. Loans given by a public authority to its transport unit have to be priced at market rates. The market value of public assets sold to third parties has to (...)

The EU Court of Justice preliminarily determines that a Lithuanian aid scheme for the provision of public interest services in the electricity sector breaches State aid rules (Achema / Orlen Lietuva / Lifosa / VKEKK)
DG ENERGY (Luxembourg)
The judgment of the Court of 15 May 2019 in case C-706/17, delivered upon a request for a preliminary ruling from the Supreme Administrative Court of Lithuania (“Achema”), replicates the analysis which was previously established in Association Vent de Colère!. The judgment in Achema thus follows (...)

The EU General Court confirms the compatibility of Polish State aid granted to its postal operator (Inpost Paczkomaty)
Arendt & Medernach (Luxembourg)
The source of this dispute is a Commission decision not to raise objections to the measure notified by Polish authorities concerning the aid granted to Poczta Polska ("PP") in the form of compensation for the net cost of fulfilling its universal postal service obligations for the period between (...)

The EU Commission authorizes Greece under State aid rules to extend by 20 years concession for the operation of a national airport (Athens International Airport)
European Commission - DG COMP (Brussels)
State aid: Commission finds no aid in €1.1 billion extension of Athens International Airport concession* The European Commission has authorised Greece, under EU State aid rules, to extend by 20 years the concession granted to AIA to operate Athens International Airport. The fee AIA will pay for (...)

The EU Commission confirms public funding for five ferry connections between Croatian islands and the mainland in line with EU State aid rules
European Commission - DG COMP (Brussels)
State aid: Commission approves public funding for five ferry connections between Croatian islands and mainland* The European Commission has found Croatian plans to grant HRK 250 million (€34 million) to ensure regular ferry connections on five routes between Croatian islands and the mainland to (...)

The EU Commission approves under EU State aid rules a Croatian plan to prolong the Istrian Y motorway (Bina-Istra)
European Commission - DG COMP (Brussels)
State aid: Commission approves €165 million of investments by Croatia for the extension of the Istrian Y motorway* The European Commission has approved under EU State aid rules a Croatian plan to prolong the Istrian Y motorway concession agreement between Croatia and the company Bina-Istra. (...)

The EU Commission approves the State aid granted to the incumbent postal operator in Denmark to meet the costs of its universal service obligations (Post Danmark)
Maastricht University
Public Service Compensation Compensation for the provision of public services may not exceed the avoidable cost minus any forgone revenue from not having to provide those services. The VAT exemption for postal services is not State aid because it is laid down in the EU VAT directive and (...)

The EU Commission approves public aid in the form of services of general economic interest compensation (Sumburgh Airport)
Giannino SI (Monserrato)
Introduction The European Commission has closed by a compatibility decision a State aid enquiry in the Sumburgh Airport case concerning public financial support granted in the form of SGEI compensation to the Scotland-based airport of Sumburgh . After establishing that the UK authorities has (...)

The EU Commission limits broadband network State aid authorizations only to areas where market based instruments are unlikely to be made without aid measures (The Netherlands)
Maastricht University
State Aid for the Deployment of Broadband Networks Most State aid for the development of broadband networks is approved by the Commission. But the aid must be limited only to areas where market-based investments are unlikely to be made without aid. Introduction This article reviews a recent (...)

The EU Court of Justice holds that it is not acceptable for assets to be transferred to a bidder that had initially participated in the process as a member of a consortium when analyzing a measure of State aid for restructuring and recapitalisation involving a bidding process (SNCF Mobilités)
University of Bristol - Law School
Do EU procurement & State aid rules conflict on possibility for consortium members to ’go it alone’? (C-127/16 P)* In its Judgment of 7 March 2018 in SNCF Mobilités v Commission, C-127/16 P, EU:C:2018:165, in the context of the analysis of a measure of State aid for restructuring and (...)

The EU Commission approves compensation provided by the UK to the incumbent postal operator for the extra costs of the public services provided for the 2018 - 2021 period (Post Office)
Maastricht University
Compensation for Public Service Obligations Introduction Every three years the UK determines the compensation it provides to the Post Office Limited (POL) for the extra costs of the public services it provides. Commission decision SA.48224 approved the compensation for the next three-year (...)

The EU Commission approves public aid in the form of services of general economic interest compensation (Bornholm Airport)
Giannino SI (Monserrato)
Introduction In Bornholm Airport the European Commission has declared the PSO compensation granted by the Danish authorities to the Bornholm Airport compatible with the internal market on the ground of the SGEI exception. Agreeing with Denmark, the Commission viewed the Bornholm Airport as a (...)

The EU General Court confirms that public funding of an e-platform for procurement purposes does not constitute State aid (Aanbestedingskalender)
Maastricht University
Activities linked to State prerogatives Economic activities which cannot be separated from the exercise of public powers cease to be economic in nature. Introduction The dividing line between economic and non-economic activities is in a permanent state of flux. Although it is now clear that (...)

The EU General Court confirms that the Netherlands is not breaching State aid rules by funding an in-house e-procurement platform (Aanbestedingskalender)
University of Bristol - Law School
Funding of in-house entities, CPBs and risks of state aid, some thoughts re Aanbestedingskalender (T-138/15)* In its Judgment of 28 September 2017, Aanbestedingskalender & Others v Commission, T-138/15, EU:T:2017:675, the General Court (GC) rejected a complaint against a previous (...)

The EU Commission qualifies an airport as a service of general economic interest and rules that the related compensation is a compatible State aid (Inverness Airport)
Giannino SI (Monserrato)
Introduction In the Inverness Airport case, the Commission ruled that the UK authorities has correctly qualified the Inverness Airport as a genuine service of general economic interest (SGEI). The Commission also ruled that the compensation awarded to the Inverness Airport for the discharge of (...)

The EU Court of Justice finds that the transfer of public assets between State-owned companies for the purpose of extinguishing a debt may constitute State aid (Fondul Proprietatea / Complexul Energetic Oltenia)
Maastricht University
Transfer of State Assets between State-Owned Companies* Transfers of public assets for the purpose of extinguishing debt have to be valued according to private creditor principle. Transfers of public assets that involve State aid must be notified to the Commission. Introduction Sale or (...)

The Austrian Supreme Court finds that the protective scope of standstill obligations does not include the prevention of damages incurred by a competitor who has been unlawfully passed over in a public tender (Bank Burgenland III)
University of Vienna (Vienna)
Background & Facts of the case One of the most prominent lines of recent Austrian State aid case law is probably the one pertaining to Bank Burgenland (“BB”), which, until its privatisation, was a regional bank taking the form of a company limited by shares under Austrian law with its (...)

The EU Commission finds that German financial instruments supporting the renovation of a congress centre are State aid compatible with the internal market (Revitalisation of the Hamburg Congress Centre)
Maastricht University
Calculating the Amount of State Aid in a 100% Public Guarantee* The proxy rates in the Commission Notice on Guarantees cannot be used in cases of state guarantees that cover 100% of the underlying loans. Introduction Last week’s article reviewed the terms of the operation of regional airports (...)

The EU Commission finds that the sale of part of an Austrian bank is not State aid according to the market economy operator test (Kommunalkredit Austria)
Maastricht University
Sale of State-Owned Bank* The sale of a public asset is free of State aid when it is open, transparent, non-discriminatory, unconditional and the award is made to the highest binding and credible offer. Introduction The rules on State aid to financial institutions and banks have become very (...)

The EU Court of Justice assesses the relationship between the Altmark judgment and Article 106(2) TFEU (Viasat Broadcasting)
Maastricht University
Altmark requires efficiency: Article 106(2) TFEU does not.* Introduction On 8 March 2017, the Court of Justice rendered its judgment in case C‑660/15 P Viasat Broadcasting v European Commission. Viasat Broadcasting appealed against the judgment of the General Court of 24 September 2015 in (...)

The EU Commission finds that Dutch subsidies for the acquisition of land for nature conservation are compatible with State aid (Nature land)
Maastricht University
Nature Conservation as a Service of General Economic Interest* Public funding of non-economic activities does not create State aid problems when any related economic activities are clearly separated. The 2012 SGEI package can apply retroactively. Introduction Member States of the European (...)

The Italian Council of State rules that collaboration between public universities and private companies for awards of State contracts does not fall within the purview of EU State aid rules because research by universities cannot be considered an ’economic activity’ (Baldoni and others)
Bonelli Erede (Brussels)
,
Luiss Guido Carli University (Rome)
,
Bonelli Erede (Brussels)
On 21 July 2015, the Council of State delivered Decision No. 3616 in which it rejected the appeal brought by a partnership between several private limited liability companies (“SCAI”) against Decision 1288/2013 of the Regional Administrative Court of Lombardy (“TAR Lombardy”). The TAR Lombardy (...)

The EU General Court dismisses an appeal by emphasising that an infringement of EU law may be simultaneous with a violation of national law (Diputación Foral)
University of Bristol - Law School
Social housing, State aid and procurement show up again in EU Courts’ case law (T-397/12)* In its Judgment in Diputación Foral de Bizkaia v Commission, T-397/12, EU:T:2015:291 (only available in ES and FR), the General Court (GC) of the Court of Justice of the European Union (CJEU) has decided a (...)

The EU Commission holds that services provided by a public authority in the exercise of its public duties are not economic in nature, even if market operators offer similar services (TenderNed)
Maastricht University
Electronic procurement in the Netherlands* Services provided by a public authority in the exercise of its public duties are not economic in nature, even if market operators offer similar services. The decision analyse in depth the presence or not of economic activity and also respond to (...)

The EU Commission applies for the first time the General Block Exemption Regulation to sport infrastructures and holds that their public funding may constitute State aid (Kristall Bäder)
Maastricht University
The First Application of the New GBER to Sport Infrastructure* Public funding of local sport infrastructure may constitute State aid. The granting of a concession contract for the construction and/or operation of the infrastructure may not exclude State aid for the concessionaire. Measures (...)

The EU General Court refuses to find the Altmark criteria fulfilled and reminds that Member States have discretion to define what they consider as an SGEI but only after having identified market gaps (Zweckverband)
Maastricht University
Not Surprisingly, Another Member State Fails to Prove Compliance with the Altmark Criteria* Main points Maintaining capacity that is necessary for the provision of normal services cannot be classified as a service of general economic interest. State aid may not be granted towards the costs (...)

The EU General Court pushes for overcompliance with EU public procurement rules in the provision of public services (Zweckverband)
University of Bristol - Law School
The GC pushes for overcompliance with EU public procurement rules in the provision of public services (T-309/12)* In its Judgment in Zweckverband Tierkörperbeseitigung v Commission, T-309/12, EU:T:2014:676, the GC has assessed the compatibility with EU State aid rules of a system of financial (...)

State aid and public procurement: An overview of EU and national case law
Gorrissen Federspiel (Copenhagen)
This foreword compares European and national case law involving the use of public procurement processes as a tool within the state aid regime and will in addition hereto touch upon the reverse, namely the effect of state aid considerations on public procurement processes. The general purpose (...)

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