Recently, the Commission published a guideline concerning the concept of state aid, which is the last part of the initiative to modernise the state aid scheme. The guideline provides information on the general principles concerning state aid, but also on how to interpret the rules within specific sectors, for instance infrastructure, health and social welfare, education and research, cultural heritage and protection of natural resources and the tax area.
The guideline also contains a section with central specification of the infrastructure area. The guideline contains, inter alia, the following three specifications:
1. Infrastructure projects can obtain aid without prior notification if the market is not subject to competition, or if the infrastructure is used as part of the state's own assignments, for instance public roads or water or waste water infrastructure. However, aid for airports, broadband and energy infrastructure generally still requires notification because these markets are subject to competition and the aid may result in the recipient obtaining a selective advantage.
2. Infrastructure for public funds is not state aid, when private operators of the infrastructure pay the market price and do therefore not obtain a financial advantage. The public authorities must ensure that the aid to infrastructure is not transferred to the operator. If the right to use the infrastructure is obtained based on a transparent and market-related procedure, for instance by way of a tender procedure, the aid will generally be in accordance with the rules on state aid.
3. Aid to infrastructure has no appreciable effect on trade if the infrastructure is a natural monopoly without any direct competitors, if the market is characterised by very few private investments, and if the aid does not provide any selective advantages to a specific player, but is generally beneficial to society. Financial aid to this kind of infrastructure projects therefore falls outside the scope of the EU state aid rules.
In the guideline, the Commission provides information on the concept of state aid in article 107 (1). However, the guideline does not contain any information as to when state aid covered by the rules is consistent with the single market and thereby legitimate.
Horten provides advice on state aid to municipalities and public and private authorities.
We help municipalities and other public and private authorities to assess whether an arrangement constitutes state aid, to which extent notification to the Commission is required, and whether a state aid arrangement may be expected to be approved.