Summary Outline of steps - European Union Law (RR218)
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Course
European Union Law (RR218)
Institution
Erasmus Universiteit Rotterdam (EUR)
Schedule, step-by-step plan, elaboration of the relevant problems in the EUL subject. With this schedule, you can easily solve the cases. Including the judgments.
Webcast basic notions I
These notions have in common that they all define measures that violate EU internal market law.
Discrimination Unequal treatment of comparable situations for a specific reason.
Direct discrimination: if you can find the ground on which the discrimination is based
by simply reading the wording of the measure under scrutiny.
Indirect discrimination: if the measure we are looking at does not literally use the
origin.
Objective differentiation Two situations that are treated differently remain different even if we exclude all forbidden
grounds as possible elements that can define these situations as being different.
Non-discriminatory restrictions That if a measure does not treat two comparably situations differently. Neither directly in its
wording, nor indirectly by affecting one situation less favorable than the other.
Webcast basic notions II
These notions have in common that they define the way for MS when their measures violate EU internal market law.
Proportionality Something must be proportionate in relation to something else. One is the measure under
scrutiny, and the other item is the benchmark against which the proportionality of the measure
is tested. The proportionality test looks into whether there are no other possibilities to realize
the objective that the measure under review pursues. If yes, the measure under review is
disproportionate.
Is the measure suitable to achieve the objective it invokes?
Is the measure necessary to attain this objective?
Exception A measure that is covered by an exception can under no circumstances violate Eu internal
market law because it is outside its reach (uitzondering).
Exemption If exempted a measure is no violation of EU internal market law (vrijstelling).
Justification Whenever there is a violation of EU law and where the state is allowed to put forward good
reasons for its cause of action. If permitted for justification, a measure must meet the
requirements of the proportionality test (rechtvaardiging).
Explicit justification grounds: limited to the grounds mentioned in Treaties.
Mandatory requirements: unwritten justification grounds that a MS can also rely on
under special conditions.
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, STATE AID: ARTICLE 107 TFEU.
State aid is aid from MS to undertakings which might be against the normal workings of the internal and
which might affect the competition. The end goal of the EU is the protection of the internal market against
behavior that affects competition unfairly.
Art. 107(1) TFEU prohibits state aid if the case meets four cumulative conditions:
Granting an economic Positive dimension: direct flow of money: a financial advantage to some undertakings
advantage. (subsidy).
Negative dimension: measure relieves undertakings of charges normally borne by it (tax).
Market economy operator test:
o Did the state act above the normal market conditions?
o If so, would a prudent independent operator acting under normal market
conditions have acted at the moment when the aid was granted in the same
manner as the state did?
x then it must be regarded as normal market behaviour.
Financed by the state or or = and (Stardust & PreussenElektra)
through state resources. Measures adopted by local, regional, and central government.
Measures by public or private bodies designated or establishes by the state.
Direct or indirect implication of state resources (PreussenElektra).
Through private resources only if formally resources are actually under state control and if
the decision to grand is imputable to the state (Stardust).
Selectivity The measure must favor certain undertakings or the production of certain goods. In case of
a negative dimension (tax) use a three-step test:
o Identify the common tax system applicable in the MS.
o Are there certain undertakings favored which are in a legal and factual situation
that is comparable in the light of the objective pursued by the measure in question
(prima-facie selectivity)?
o Is this differential treatment between comparable undertakings justifiied in the
light of the nature or overall structure of the tax system? This can take place by
objectives that are inherent to the general tax system.
The Court used this test to see if they derogated from normal tax rules
(Adria-Wien).
(Gibraltar Tax Reform)
Distortion of the competition The existence of a competitive link between undertakings receiving the advantage and the
disadvantaged undertakings, this is linked with the selectivity and will therefore be met.
Affecting trade between MS Trade between MS is already affected when the state aid in question strengthens the
position of an undertaking as compared to any other undertakings competing in the EU
internal market.
De mimimis regulation.
Conditions are met prohibited state aid.
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, Exemptions to prohibited state aid
Art. 107(2) TFEU Hard justifications.
Commission has no discretion to decide whether a measure is justified under one of these
conditions.
Social aid
o The aid must be given to individual consumers.
o The aid must be granted without discrimination related to the origin of the
products concerned.
Disaster aid
o The Court insists on a very strict interpretation: prolonged bad weather conditions
or outbreak of animal diseases will normally not qualify.
o The Court has insisted on a direct link between the aid and damage.
German aid
Art. 107(3) TFEU Soft justifications
Commission has discretion to decide whether a measure is justified under one of these
conditions.
Regional aid
Project and crisis aid
Economic aid
Cultural aid
Other aid
Enforcement of art. 107 TFEU by art. 108 TFEU and the Regulation
Art. 108(3) TFEU Requires MS to notify aid measures to the Commission before they are implemented:
notification obligation.
Has direct effect and can therefore be applied by national courts.
This is called the standstill obligation: MS cannot implement aid measures until the
Commission authorizes them (art. 3 Regulation 2015/1589).
o Provision has direct effect.
o Provision can be enforced in national courts.
o Provision includes an obligation to recover unlawful aid (Belgium v. COM).
Art. 108(2) TFEU Commission must analyse whether aid granted by the state may be justified under 107(2)
(3). If not, the MS must abolish or alter the aid.
Before and during the investigation it is considered unlawful aid.
Art. 108(1) TFEU If aid fount compatible under the internal market, the aid is authorized and must be kept
under constant review.
Services of general economic interest (SGEI)
Art. 106(2) TFEU Compensation is no state aid if the recipient undertaking must have public serving
obligations to discharge.
The compensation cannot exceed what is necessary to cover all or part of the costs
including the discharge of the public service obligations, considering the relevant receipt
and reasonable profits.
Example: public transportation services.
CARTELS: ARTICLE 101 TFEU.
Notion of undertaking
CJEU (functional approach) Functional approach because where there is an economic entity there is economic activity.
Any single economic entity engaged in economic activities irrespective of its legal status
and regardless of the way in which it is financed is an undertaking (Höfner and Elser).
o This definition broadens the scope. It catches natural persons, professionals and
the state and its public bodies when they engage in economic activities.
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