Checks and balances in EU State aid procedures: should more be done to protect the rights of aid recipients and third pa
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Checks and balances in EU State aid procedures: should more be done to protect the rights of aid recipients and third parties? Kristina Nordlander · David Went
Published online: 21 August 2010 © ERA 2010
Abstract A recent Advocate General’s Opinion in the long-running Scott Paper saga has again called into question the procedural fairness of the European Commission’s State aid procedures. This paper examines issues of due process in State aid cases and suggests that it may now be time to consider fundamental procedural reform. Issues discussed include the limited rights afforded to aid recipients and interested third parties, the often excessive length of State aid procedures, and the inadequacy of the appeals process. We submit that modern State aid enforcement calls for procedural reform. Keywords State aid · Rights of third parties · Beneficiaries · Commission procedure 1 Introduction The Commission has over the past few years been reassessing the State aid regime, including the extent of rights afforded to aid recipients and interested third parties.1 1 The State aid regime is now conducted pursuant to Articles 107 and 108 of the Treaty on the Functioning
of the European Union (“TFEU”) (ex. Arts. 87 and 88 EC). Entry into force of the TFEU or so-called Lisbon Treaty has led to a renumbering of the Treaty articles. This paper is partly based on a presentation given at the ‘Annual Forum on European State Aid Law’ organised by ERA in Trier on 12–13 November 2009. The views expressed by the authors in this article are their own and do not necessarily reflect the views of Sidley Austin LLP or any of its clients. The authors are grateful to Rosanna Connolly and Max Dannheisser for their assistance. K. Nordlander, Partner () Sidley Austin LLP, Square de Meeus 35, 1000 Brussels, Belgium e-mail: [email protected] D. Went, Counsel Sidley Austin LLP, Woolgate Exchange 25, Basinghall Street, London, EC2V 5HA, GB e-mail: [email protected]
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K. Nordlander, D. Went
In its 2005 State Aid Action Plan,2 the Commission proposed a comprehensive reform package, which included the need for more effective procedures, better enforcement, higher predictability, and enhanced transparency. Publication of the State Aid Action Plan drew comments from a large number of interested parties, including EU national competition authorities, the business community, and law firms. This consultation highlighted a number of ways in which the existing regime should be reformed, including shorter review periods, more predictable timeframes, and increased rights of aid recipients and interested third parties. Following the State Aid Action Plan, the Commission introduced revised or new legislation and guidance documents relating to State aid, including a Code of Best Practice.3 Although this has certainly led to an improvement in State aid procedures, it is questionable whether the reforms have been sufficient to address the shortcomings and inefficiencies in the procedures flowing from the marginal role given to aid recipients and intereste
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