7.2 Existence of State aid within the meaning of Article 107 (1)TFEU?

When the Commission assesses State aid measures, the first step is the question whether the aid measures constitute State aid within the meaning of Article 107 (1) TFEU. This step does not concern the compatibility of State aid, but the existence of State aid. It is – from the viewpoint of this PhD-study – a preliminary step, since the question of the compatibility only becomes relevant when the aid measures fall within the scope of Article 107(1) TFEU.

The question whether a particular measure constitutes ‘State aid’ within the meaning of Article 107(1) TFEU is sometimes a difficult question which requires a thorough assessment. As discussed in chapter 2, there is an entire body of case-law about the notion of ‘State aid’, which indicates that the question whether a particular measure constitutes State aid is a difficult one. However, with respect to State aid to banks, this question is usually easy to answer. Indeed, it is often quite clear that the measures taken by Member States to rescue ailing banks constitute State aid. Moreover, when Member States notify aid measures in favour of banks to the Commission, they usually agree that these measures constitute State aid, but they consider this aid to be com-patible. The point at issue is thus often the compatibility of aid, rather than the existence of aid.1

Nevertheless, there are sometimes questions about the existence of State aid. In that respect, the main issues that arise, are the question whether the aid is imputable to the State and the question whether the State acted as a market economy investor. These questions will be discussed in section 7.3 and 7.4. Another question concerns the identification of beneficiaries of State aid. This will be discussed in section 7.5.