State Aid

Since its inception, EU competition law has proscribed the granting of aid in any form, by an EU Member State or through State resources, that favours certain companies or industries, distorts or threatens to distort competition and affects trade. The term “aid” is broadly construed, and may cover benefits ranging from direct injections of capital to tax relief to favourable lending terms. However, what might appear to be “aid” may instead be classified as a reasonable – and legal – investment by a government shareholder. Moreover, there are a number of automatic exceptions to the general prohibition on state aid (for example, certain aid of a social character) as well as a number of situations in which the European Commission has discretion on whether or not to approve a given aid (for example, aid to promote regional development or a project of European interest). As putting a stop to illegal state aid remains a priority for the European Commission, it is important that recipients of government assistance and competitors of such recipients alike are familiar with the intricacies of the EU state aid rules.

Van Bael & Bellis has experience advising on a wide variety of complex state aid issues. In various cases before the Commission and/or the EU Courts, the firm’s lawyers have represented alleged aid recipients, complainants, intervening third parties and Member State government entities accused of granting illegal aid in sectors as diverse as steel, zinc, cement, consumer electronics, aerospace and defence equipment. We have also assessed proposed aid schemes and advised clients on the potential risk of these schemes under the EU state aid rules. Furthermore, Van Bael & Bellis has counselled non-EU Member States on state aid issues and has also advised companies in countries soon to join the EU on the compatibility with the EU state aid rules of government assistance they have received.