EU

Recent Developments February 2017

News Update EU State Aid Special
07 February 2017

The Absence of Economic Data in State Aid Investigations

In 2011, the Greek company OPAP was granted an exclusive license to operate 35.000 Video Lottery Terminals ("VLT Agreement") in Greece. Several companies filed a complaint with the Commission in which they submitted that the grant involved incompatible state aid. In 2012, the Commission concluded that the VLT Agreement was free of state aid. The complaining companies brought an action for annulment of the decision, which the General Court dismissed in 2013. In the appeal case before the Court of Justice of the EU ("CJEU") the complaining companies argued that the absence of certain economic data in the Commission decision resulted in an infringement of their right to effective judicial protection because they were prevented from arguing that there was a manifest error of the assessment on the part of the Commission due to this absence. The CJEU now rejects this appeal, concluding that the companies did not specify to what extent the data would have been relevant for the purpose of providing evidence that the Commission had encountered serious difficulties as regards the classification of the VLT Agreement as aid.

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Court of Justice Dismisses Commission Appeal in Lübeck Airport Case

In 2007, the Commission adopted a decision to initiate the formal investigation procedure in relation to a contract concluded between Flughafen Lübeck GmbH ("FL") and Ryanair that set airport charges for Ryanair lower than those laid down in the 1998 schedule of charges. FL brought an action for annulment of this decision. FL was wholly owned by the City of Lübeck and the airport was sold in 2013. The General Court concluded that FL was directly and individually concerned by the decision and therefore had standing when the action was brought. It concluded that FL had retained a legal interest in bringing proceedings after the airport was sold. The CJEU dismisses the appeal of the Commission and concludes that after the privatisation of the airport the City of Lübeck remained at least exposed to the risk that a national court might order the recovery of any aid granted when FL owned the airport. In the absence of a final decision of the Commission closing the formal investigation procedure, the City of Lübeck therefore retained an interest in bringing proceedings seeking for the annulment of the decision a dispute.

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Belgium Passes Law to Recover Illegal Aid in Excess Profit Ruling Case

In the final days of 2016, Belgian lawmakers approved a law which allows the Belgian government to recover more than € 700 million in corporate tax breaks. In January 2016, the Commission decided that selective tax advantages granted under the Belgian 'excess profit' tax scheme constitute illegal state aid. The scheme reduced the corporate tax base of the companies by between 50% and 90% to discount for so-called 'excess profits' that allegedly result from being part of a multinational group. At least 35 multinationals benefitted from the scheme. Belgium and several of the beneficiaries lodged an appeal against the Commission decision at the General Court. Meanwhile, Belgium is under the obligation to start the recovery of the illegal state aid while the appeal is pending. The Belgian law of 25 December 2016 provides the government with the legal mechanism to recover the illegal aid from the concerned multinationals.

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New Dutch Guidance Document on State Aid

The Dutch Ministry of the Interior and Kingdom Relations published a guidance document on state aid for the Dutch levels of government ("Handreiking Staatssteun voor de Overheid"). The document is a tool for policy officers and financial or judicial staff of ministries and other aid granting authorities. The document bundles the available information on state aid after the modernization of the state aid rules. The modernization resulted in more opportunities for national authorities to grant aid without a prior notification.

Read more (Dutch only).

The Houthoff Buruma EU team is available at eu-office@houthoff.com or +32 (0)2 507 98 00.

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