Commission v World Duty Free SA & Others-Another Threat to Members States' Fiscal Competences?
Date | 01 January 2017 |
Author | Valeria Dardano and Federica Iorio |
115
Commission v World Duty Free SA & Others
—Another reat to Members States’ Fiscal
Competences?
VALERIA DARDANO FEDERICA IORIO
Article 107(1) of the Treaty on the Functioning of the European Union (“TFEU”)
prohibits State Aid in the following terms:
[s]ave as otherwise provided in the Treaties, any aid granted by a Member
State or through State resources in any form whatsoever which distorts or
threatens to distort competition by favouring certain undertakings or the
production of certain goods shall, in so far as it aects trade between Member
States, be incompatible with the internal market.
Article 108 TFEU gives the European Commission (“the Commission”) almost
exclusive authority to control State Aid. e aim of these provisions is to ensure
that all businesses are placed on a level playing eld, by preventing Member States
from conferring an undue advantage on some (selected) economic operators.1
Despite the necessity of control over State Aid for the proper functioning of the
internal market, the Treaties do not dene the concept. In this respect, both the Court
of Justice of the European Union (“CJEU”)2 and the Commission3 have clearly stated
that the notion of State Aid is an objective legal concept, to establish the existence of
which one “should look at the eects and not at the intentions of the Member State”.4
is concept encompasses not only public subsidies, but also any measures which
would tend to reduce the burden borne by an economic operator “under normal
market conditions”,5 such as targeted scal measures,6 or tax exemptions .7
1 On the aim of State Aid control and its shi from the avoidance of subsidy races to prevention of
distorted competition see K. Bacon, European Union Law of State Aid, 2nd edn (Oxford: Oxford
University Press, 2013), pp. 9–11, paras 1.16–1.20
2 Italian Republic v Commission (Italian textile case)(173/73) [1974] E.C.R. 709, para. 13
3 Commission notice on the application of the State aid rules to measures relating to direct business
taxation (98/C 384/03) [1998] O.J. C 384, 10 December 1998, pp. 3–9, para. 15, quoting the
Italian textile case, supra, note 2,
4 Commission v Romania (Decision SA.38517) [2014] O.J. C 393, 7 November 2014, pp. 27–40, para. 28.
5 Syndicat ançais de l’Express international (SFEI) and others v La Poste and others (Case C-39/94)
[1996] E.C.R. I-3547, para. 60; Spain v Commission, (Case C-342/96) [1999] E.C.R. I-2459, para. 41.
6 Supra, note 2, para. 5 where the Court states “such as a temporary reduction in contributions payable
by the textile industry in respect of family allowances”. For an overview see Phedon Nicolaides
“Fiscal Aid in the EU: the Limits of Tax Autonomy” (2004) 27(3) World Comp. 365–396
7 Belgium and Forum 187 ASBL v Commission (Joined Cases C-182/03 and C-217/03) [2006]
E.C.R. I-05479, paras 105 and 121
07 Dardano.indd 115 30/05/2017 16:35
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