A recent study carried out for DG COMP of the European Commission provides a comprehensive overview of the enforcement of State aid rules by national courts from 2007 until 2017. This report is available on a dedicated website that also hosts a database with summaries of selected national State aid enforcement rulings throughout the EU.
In line with the settled case-law of the Court of Justice, national courts and the European Commission have complementary but separate roles in implementing the system of State aid control. Whilst the assessment of the compatibility of aid measures falls within the exclusive competence of the Commission, subject to review by the Courts of the European Union, it is for the national courts to safeguard the rights of individuals in the context of the implementation of recovery decisions (i.e. so-called public enforcement) or in cases where a Member State has granted aid without respecting the standstill obligation (i.e. so-called private enforcement).
The study has looked into both types of enforcement by national courts and comes with some quantitative and qualitative trends based on the judgments handed down by national courts.
The first trend identified concerns the overall increase in the number of judgments with 766 relevant rulings throughout the study period. In this context, it is highlighted that private enforcement now largely exceeds public enforcement. This upward trend in the number of State aid rulings is also apparent throughout the study period, since the number of cases has somehow tripled between 2007 and 2017. According to the study, this trend can to a certain extent be explained by the fact that companies and their advisors are more and more aware about State aid potentially being used as a ‘sword’ or as a ‘shield’ in a competition-related litigation.
The study nonetheless reports that, despite the increase of court litigation, national courts have rarely concluded that unlawful aid has been granted. Moreover, only in very few cases the courts awarded compensation due to the harm caused by a breach of the standstill obligation by a Member State. The study and the accompanying country reports reveal a number of reasons which may explain this reluctance. One reason is that not all national courts are familiar with State aid rules. In particular, the study reveals that national courts still face difficulties in applying the Market Economy Operator Principle and the Altmark criteria. In addition, State aid claims often require national courts to assess the legality of the measure under different areas of law (e.g. tax, administrative, contract law) which renders the evaluation of the measure under State aid rules even more complex. Another important reason is that a State aid claim generally implies a high burden of proof for the claimant. In particular, it may be difficult for the claimant to prove a direct and univocal correlation between the breach of the standstill obligation and the harm suffered.
In view of these somehow ambiguous findings as regards the number of cases and the number of remedies awarded, the study also suggests some best practices to render the enforcement of the State aid rules more effective and underlines the possibilities for national courts to use the cooperation tools laid down in Article 29 of the State Aid Procedural Regulation.
Please contact Pierre de Bandt or Jeroen Dewispelaere for general legal advice relating to State aid