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)

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 therefore cannot be attributed to Member States. Introduction This article reviews Commission decision on measure SA.47707 concerning compensation for public services entrusted to Post Danmark, the incumbent postal operator in Denmark. The case is rather unusual for several reasons. First, the compensation would be paid to PostNord which then would pass it to Post Danmark. Post Danmark is a wholly owned subsidiary of PostNord. Second, PostNord is owned jointly by Denmark and Sweden. Third, the public

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