General Principles of EC Law and Rights of Private Parties in State Aid Proceedings (original) (raw)
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CFE Tax advisers europe, 2024
This is an Opinion Statement prepared by the CFE ECJ Task Force1 on the Engie case, in which the Court of Justice of the EU (Grand Chamber) delivered its decision on 5 December 2023. The Engie case concerns the question whether tax rulings issued by Luxembourg to companies part of the French energy group Engie, are compatible with primary EU law, notably rules on State aid; and, whether, and to what extent, the Commission can invoke the concept of “abuse of law” for a State aid challenge of ex ante tax assessment issued by a tax authority of a Member state in the form of a tax ruling. The Court set aside the General Court judgment of 12 May 2021, which initially upheld the European Commission findings of State aid. The CJEU’s Grand Chamber found that the European Commission did not establish to the appropriate legal standard that the tax rulings related to the zero-interest convertible loan (ZORA) provided selective advantage for the Engie entities. It did not establish the correct reference framework for assessment of State aid by way of excluding the legal basis for the tax ruling practice from the reference framework itself (Articles 164 and 166 LIR). By establishing an erroneous reference framework, the Commission relied on a wrongfully based selectivity analysis, a key step in establishing State aid for purposes of Article 107(1) TFEU. Finally, the Court established that the Commission cannot invoke national anti-abuse rules to establish selectivity in a situation where the non-application of the “abuse of law” concept by tax authorities unless the non-application of the antiabuse provisions is based on derogation from national law or administrative practice on anti-abuse provisions comparable to the case at issue (in concreto). Thus, the Grand Chamber judgment follows the Opinion of AG Kokott delivered on 4 May 2023. The Court, however, opened the door for establishing selectivity of tax rulings such as those in the Engie case, where the basis for taxation consists of pre-agreed margin (mark-up), approved by the tax administration, and not under the rules of ordinary tax law, under specific conditions. This Opinion Statement focuses on questions of law and the relevance for the development of the European Union State Aid law doctrine applicable to tax measures. The factual and corporate law aspects are analysed to the extent relevant for the State aid analysis.
EC Law on State Aid; Legal Framework, Case Law and The Story in The Alitalia State Loan Case
Masaryk University journal of law and technology, 2009
The EC Treaty does not include any definition of State aid. Nevertheless, the Commission and the European Courts have construed the definition so that we should regard State aid as any advantage granted directly or indirectly through State resources. The ECJ has e.g. in Belgium v Commission stated that aid is ‘defined in regards to its effect, and not its aim or form’. Four cumulative elements must be shown to satisfy the test for State aid which mean that the measure must be specific, it must grant an advantage to an undertaking, the aid must come from State resources, the advantage must distort competition and have an effect on Trade between Member States. Under the first criterion (the measure must be specific) we should understand general economic policy norms (growth- and stability-oriented macroeconomic policies which should sustain economic growth in the short term, create the possibility for growth in the medium-term and the capacity for structural changes in longer-term). A...
Autumn Conference on European State Aid Law 2017
The conference adressed specific issues on State aid Law: Interplay of State aid and Strcutural Funds regimes; the notion of "aid´and `no effect on trade´, the impact of State aid control on fiscal law; State aid in environmental and energy sectors - tax specific considerations and the lates jurisprudence on EU State aid matters.
Crisis-driven austerity measures adopted by some Eurozone Member States to satisfy the conditions for receiving financial assistance have raised concerns over the level of protection of fundamental rights afforded to individuals, and have thrown into sharp relief the problems surrounding the efficiency and the lack of transparency of crisis management mechanisms at the national and EU level. This contribution provides an overview of some of the most prominent litigation arising in the context of financial assistance given to Portugal, Greece, and Cyprus. Growing literature has examined the macroeconomic adjustment programmes of these countries from a constitutional (viz. the legal competence of the EU bailouts/bail-ins) and a social policy perspective (viz. the impact of the programmes on labour and employment social rights). Taking stock of these accounts, this article seeks to provide an updated picture of the most relevant case law, focusing on the position of the individual as a litigant. The article does not purport to provide an all-encompassing or comparative analysis of the litigation concerning the Eurozone bailouts. Such a challenging task would require extensive analysis not only of cases brought before numerous national courts, but also of the specifics of the national judicial systems of the three Eurozone Member States. Instead, this contribution aims to bring together the main attempts that have taken place so far to challenge measures adopted by the three Eurozone Member States in order to fulfill the conditions for receiving financial assistance. To this effect, the article first explains the concept of conditionality in the context of financial assistance (i). It then outlines some of the most pertinent cases at the national level (ii) and discusses the litigation before the Court of Justice of the EU (CJEU), focusing on recent developments in the case law concerning financial assistance by the European Stability Mechanism (ESM) (iii). It concludes with an outlook on future developments in this saga of litigation. As a concise account of relevant case law, the article could be of interest to anyone who wishes to follow the development of the judicial responses to the Eurozone bailouts.
The article analyzes the impact of the financial crisis on the decision-making and content of State aid control. The urgency and the extraordinary size of the subsidies committed by Member States to save national banks in 2008 let the Commission modify its ordinary decision-making practices and adopt a new set of soft law, which represented an important change in the goals of this sub-policy in comparison to the pre-crisis period. On the other hand, once the urgency of the crisis disappeared in mid-2009, the Commission returned to its ordinary decision-making and forced the financial institutions to be restructured, as under the pre-crisis rules. Therefore, by accommodating the initial requests of the Member States which demanded the Commission to ´speed-up´ its review approach and to enforce State aid rules in a more lenient way, the Commission managed to safeguard its exclusive competence in State aid control.