7.4 Market Economy Investor Principle (MEIP)

Section 2.3 discussed the cumulative conditions that have to be met for a measure to fall under the definition of State aid. One of these conditions is that the measure must confer an ‘advantage’ to the recipient. In order to be able to assess whether an aid measure entails an advantage, the Commission applies the Private Investor Test – also referred to as Private Investor Principle, Market Economy Investor Principle (MEIP) or Market Economy Operator Principle (MEOP).1 The essence of the private investor test is that the behaviour of the State is compared to that of a hypothetical private investor. If the State acts like a private investor would do (under similar circumstances), then the measure contains no aid-element. In other words: the hypothetical private investor serves as the benchmark against which the economic rationality of a State intervention is assessed.