114 COMPETITION LAW IN TOURISM 2.1. What State aid is and what it is not The EU courts have developed, over the decades, the concept or notion of State. Although it is an objective and legal notion, this interpretative work is never finished. There is always room for finetuning and the further enlightenment of some of its aspects. One thing is certain, the elements mentioned in Article 107(1) TFEU are cumulative10 and all of them have to be present. Therefore, if a single one is missing, in relation to a state measure, it does not constitute State aid. These elements are the following: 1) the beneficiary is an undertaking, 2) the measure is financed from state resources or by the state, and it should provide 3) a selective 4) advantage to certain undertakings, 5) it should distort, or threaten to distort, the competition insofar as 6) it affects the trade between the Member States. During the analysis, whether a measure constitutes State aid, all these elements have to be assessed individually. Given that it is a very complex concept, being each of its elements subject to detailed assessment, the European Commission, as a part of the State aid Modernisation initiative11, presented, in 2016, a communication about the notion of State aid to provide guidance for stakeholders12. The aim of this paper is not to duplicate the detailed description of the different constituent elements of the notion of State aid, but to highlight some cases in which the interpretation of these constituent elements was somehow linked to the tourism sector. 2.2. When is State aid compatible with the internal market? The prohibition to grant State aid is not absolute, Article 107(1) TFEU uses the term “[S]ave as provided otherwise in the Treaties”, meaning that there might be exemptions defined in the primary EU Law. These can be found in different TFEU articles. Articles 42 and 93 define special treatment for agriculture and certain transport activities and Article 107(2) and (3) list the more horizontal exemptions. As regards the exemptions listed in Article 107(2), their main characteristic is that these are compatible with the internal market, where the Commission has no real freedom of assessment, needing only to verify whether the TFEU conditions are met. Meanwhile, the exemptions listed in Article 107(3) “may be considered as 10 See the judgment in case C-20/15 P Commission v World Duty Free Group and Others, (EU:C:2016:981), paragraph 53. 11 Source: https://ec.europa.eu/competition/state_aid/modernisation/index_en.html. 12 Commission Notice on the notion of State aid as referred to in Article 107(1) of the Treaty on the Functioning of the European Union (OJ C 262, 19.7.2016, pp. 1-50), hereinafter “NoA”.
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