Public funding of failing banks in the European Union (LBF vol. 19) 2020/3.9.3:3.9.3 Legal proceedings before national courts

Public funding of failing banks in the European Union (LBF vol. 19) 2020/3.9.3

3.9.3 Legal proceedings before national courts

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The national courts have no jurisdiction to declare State measures compatible with Article 107(2) or (3) TFEU.1 In addition, decisions from the Commission cannot be challenged before the national courts.2 The na tional courts do however play a role in interpreting the notion of State aid, in cases where a Member State has granted State aid without respecting the standstill obligation (unlawful aid) and in the enforcement of recovery decisions. The involvement of national courts in such cases usually arises from actions brought by competitors of the beneficiary.3 The national courts may ask the Commission to transmit to them information in its possession or its opinion on questions concerning the application of State aid rules.4 Where the coherent application of Article 107(1) or Article 108 TFEU so requires, the Commission, acting on its own initiative, may submit written observations to the national courts. It may, with the permission of the court in question, also make oral observations.5

Remedies available before national courts include preventing the payment of unlawful aid, recovery of unlawful aid (regardless of compatibility) and interest, damages for competitors and other third parties, and interim measures against unlawful aid.6

National courts have to preserve, until the final decision by the Commission, the rights of private parties against any violation by the State in question of the prohibition that Article 108(3) TFEU imposes (the standstill obligation).

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