40 LEGAL IMPACTS OF COVID-19 IN THE TOURISM INDUSTRY need for an ex-ante notification. This is obviously a good solution to save capacity for the more complex cases, but it also has its pitfalls, since the Member States have to be very careful and prudent when applying the provisions of block exemption regulations. Otherwise, beneficiaries can face the risk of repayment (called recovery) of incompatible aid paid to them. State aid law and its application is essentially based on two main questions, i.e. whether a measure is State aid in the sense of Article 107(1) TFEU, and if yes, whether it is compatible under any of the options provided by the EU regulations, decisions or the soft law designed by the Commission. 2.2. What Is and What Is Not State Aid? The EU courts have developed, over the decades, the concept or notion of State aid. Although it is an objective and legal notion, the process of its interpretation is never finished. There is always room for fine-tuning and the further clarification of some of its aspects. One thing is certain: the elements mentioned in Article 107(1) of the TFEU are cumulative23 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 (it carries out economic activities), 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 competition insofar as 6) it affects trade between the Member States. During the analysis of whether a measure constitutes State aid, all these elements have to be assessed individually. Given that it is a very complex concept, with each of its elements subject to detailed assessment, the European Commission, as a part of the State aid Modernisation initiative24, published a communication in 2016 about the notion of State aid to provide guidance for stakeholders25. The concept of aid shows that sectoral State measures are selective, and the European Commission usually does not treat these measures as having positive impact on the whole Eesti Pagar AS v Ettevõtluse Arendamise Sihtasutus and Majandus- ja Kommunikatsiooniministeerium (ECLI:EU:C:2019:172), C-654/17 P Bayerische Motoren Werke AG v European Commission (ECLI:EU:C:2019:634). 23 See the judgment in case C-20/15 P Commission v World Duty Free Group and Others, (EU:C:2016:981), paragraph 53. 24 Source: https://ec.europa.eu/competition/state_aid/modernisation/index_en.html (accessed on 10 March 2021). 25 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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