Short Reads

General Court confirmed that German law on renewable energy amounts to State aid

General Court confirmed that German law on renewable energy amounts to State aid

General Court confirmed that German law on renewable energy amounts to State aid

02.06.2016 EU law

On 10 May 2016, the General Court ("GC") dismissed Germany's appeal against the decision of the European Commission concerning the German law on renewable energy, which came into effect in 2012 ("EEG 2012"). Germany disputed the Commission's finding that the EEG 2012 amounted to State aid despite the fact that the Commission largely approved the aid.

The proceedings started after the German Association of Energy Consumers lodged a complaint with the Commission about the EEG 2012. The EEG 2012 aims to increase the development of renewable energy by laying down a scheme to support undertakings that produce such energy. These undertakings receive a price from network operators for the renewable electricity which is higher than the market price ("first beneficiaries"). In order to finance this measure the suppliers of the renewable energy have to pay an "EEG surcharge" to the network operators responsible for its collection and administration. In practice, the costs of this surcharge are passed on by the suppliers to the final consumers in the form of a higher price for the transferred energy. The scheme stipulates that the amount of the EEG surcharge that may be passed on by electricity suppliers to final consumers is subject to a cap when it concerns 'electricity-intensive undertakings in the manufacturing sector' ("second beneficiaries"). The cap serves to reduce the energy costs of these undertakings so as to maintain their international competitiveness.

The Commission decided in 2014 that the aid to the first beneficiaries constituted State aid which was compatible with the internal market. However, the Commission decided that the State aid to the second beneficiaries was considered only partially compatible with the internal market. The other part of the aid therefore had to be recovered by Germany. Germany appealed this decision, arguing that the entire scheme provided for by EEG 2012 does not amount to State aid.

The GC dismissed the appeal. First of all, it held that the funds generated by the EEG surcharge qualify as State resources because the State controls the way in which the network operators collect and administer the funds. In the otherwise comparable PreussenElektra case, the funds were transferred directly from private parties to the producers of renewable energy, i.e. without the involvement of a State-controlled intermediary. In that case the measures did not qualify as State aid. Secondly, the GC rejected the argument that the second beneficiaries did not receive an advantage but were rather compensated for a competitive disadvantage due to the fact that energy charges are lower in other countries of the European Union. It pointed out that attempts to mitigate the differences in economic conditions with other Member States do not deprive a measure of its character as State aid.

In conclusion, this judgement illustrates (i) that competitive disadvantages in comparison to undertakings in other Member States do not prevent a measure from being regarded as State aid and (ii) that the way in which a scheme is shaped is important. In particular, schemes which bring funds under State control will generally be regarded as State aid.

This article was published in the Competition Law Newsletter of June 2016. Other articles in this newsletter:

  1. General Court rejects Trioplast's action for annulment of a Commission notice to pay interest
  2. Commission blocked Hutchison's proposed acquisition of Telefónica UK
  3. European Commission publishes guidance on the notion of State aid
  4. District Court of Rotterdam upheld the ACM's unconditional clearance decision in telecoms merger KPN/Reggefiber
  5. Rotterdam District Court considered "franchise agreements" in breach of competition law in launderette cartel case
  6. UK High Court held that territorial limits apply to EU cartel damages claims

Team

Related news

10.07.2018 EU law
Hof van Justitie EU oordeelt over reikwijdte 'beroepsgeheim' financiële toezichthouders voor bedrijfsgegevens

Articles - In een arrest van 19 juni 2018 oordeelt de Grote kamer van het Hof van Justitie EU over de reikwijdte van het 'beroepsgeheim' van financiële toezichthouders voor bedrijfsgegevens. Het hof oordeelt dat de informatie die zich in het toezichtsdossier bevindt niet onvoorwaardelijk vertrouwelijk van aard is en bijgevolg onder het beroepsgeheim van de toezichthouder valt. Gegevens die mogelijk commerciële geheimen zijn geweest, worden in beginsel geacht niet meer actueel en dus niet langer geheim te zijn, wanneer die gegevens ten minste vijf jaar oud zijn.

Read more

02.07.2018 EU law
General Court delivers judgments on the scope of dawn raid decisions

Short Reads - On 20 June 2018, the General Court rendered its judgment in two connected appeals submitted by České dráhy, the Czech Railways Operator, challenging two dawn raid decisions by the European Commission. Based on arguments concerning the scope of the investigation, the Court annulled in part the first dawn raid decision and fully upheld the second dawn raid decision.

Read more

29.06.2018 EU law
Un dossier de soumission imparfait peut-il être rectifié par le paiement d’une amende ?

Articles - Dans l’arrêt du 28 février 2018, la Cour de justice donne son avis sur la possibilité pour un soumissionnaire de rectifier, pendant la phase de sélection et moyennant paiement d’une amende, son dossier de soumission imparfait par un ajout et/ou commentaire. La Cour précise que cette mesure n’est, en principe, valable que si la nature de l’irrégularité constatée permet une rectification ultérieure et que le montant de l’amende est proportionnel à l’importance de l’irrégularité constatée. 

Read more

29.06.2018 EU law
Kan een gebrekkige inschrijving worden rechtgezet tegen betaling van een boete?

Articles - Het Hof van Justitie verduidelijkt in een arrest van 28 februari 2018 dat een regeling waarbij een inschrijver in de selectiefase verzocht wordt om tegen betaling van een boete diens gebrekkige inschrijving via een aanvulling en / of toelichting recht te zetten in beginsel aanvaardbaar is – voor zover (i) de aard van de vastgestelde onregelmatigheid een a posteriori rechtzetting toelaat en (ii) de omvang van de geldboete evenredig is met de zwaarwichtigheid van de vastgestelde onregelmatigheid.

Read more

Our website uses cookies: third party analytics cookies to best adapt our website to your needs & cookies to enable social media functionalities. For more information on the use of cookies, please check our Privacy and Cookie Policy. Please note that you can change your cookie opt-ins at any time via your browser settings.

Privacy – en cookieverklaring