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COMPETITION • EUROPEAN LAW • STATE AID
The Commission may open a formal investigation procedure when, after a preliminary examination, it finds that the notified measure raises doubts as to its compatibility with the internal market ( Regulation No 2015/1589, Art. 4), when it intends to revoke a decision for inaccurate information (Art. 11), in the event of misuse of aid (Art. 21) or when the European courts annul its decision. Withdrawal of a decision for insufficient reasoning and its replacement by a new decision does not require the formal procedure to be reopened once the interested parties have been heard and involved in the procedure when the initial decision was adopted.
The concept of "serious difficulties" in determining whether an aid is compatible with the internal market has an objective character. Their existence must be sought from the circumstances of the adoption of the State measure and in its content "comparing the grounds of the decision with the information available to the Commission when it took a decision on the compatibility of the disputed aid". The evidence of the existence of serious difficulties may be established by "reference to a body of consistent evidence" assessed on the basis of elements of fact and of law existing at the time when the measure was adopted. The excessively long duration of the preliminary stage, the absence of precise data on the overcapacity of the sector concerned or the competition context, the fact that the contemplated measure was preceded by measures classified as unlawful aid, or the existence of letters between the Member State concerned and the Commission showing that the latter had at first classified the measure as aid are indications of serious difficulties. By contrast, this is not the case of previous correspondence between the Commission and the Member State concerned or commitments given by a Member State to dispel certain doubts relating to the classification of the aid. The Commission can in effect conclude, during the preliminary investigation, that the aid measure conferred an advantage on its beneficiary without being required to initiate the formal investigation procedure provided for in Article 108(2) TFEU, as it remains possible to overcome the difficulties encountered during talks with the notifying State and in particular by means of commitments entered into by that State.
The Commission is not required to comply with a minimum period during its formal investigation procedure, but should as far as possible endeavor to adopt a decision within a period of 18 months from the opening of the formal investigation procedure (Article 9(6)). The decision to initiate the procedure must summarize all relevant issues of fact or law, include a preliminary assessment of the proposed measure and set out the reasons resulting in the Commission having doubts as to the compatibility of the measure with the internal market (Art. 6). While the Commission is required to clearly express its doubts as to the compatibility of the aid when it opens a formal investigation procedure, the applicant of the aid is responsible for dispelling those doubts. The decision to open the formal procedure is published, except for confidential information, within two months from its adoption. The formal investigation procedure may be suspended in exceptional circumstances, in particular if the State formally requests so in order to bring its project in line with State aid rules.
Like during the preliminary examination stage, the Commission may require the immediate suspension of the measure, after giving the Member State concerned the opportunity to submit its comments (Art. 13). Where the Member State fails to comply with the injunction, the EU authority has the possibility to initiate proceedings before the Court of Justice pursuant to Article 107(3) TFEU while pursuing the substantive examination. The injunction to suspend the implementation of an existing measure, classified by the Commission as new aid, may take place at the same time as the decision to open the formal investigation procedure or may be subsequent thereto. The opening of a formal investigation procedure does not automatically result in suspending payment of the State aid where the dispute relates to its nature as new or existing aid. However, the opening of the formal procedure affects the validity of measures giving effect to aid that a subsequent decision of compatibility cannot regularize ex post facto. The Commission may also require the Member State provisionally to recover any payment made in effect of an unlawful aid provided that there are no doubts about the aid being classified as aid, urgency is established, and there is a serious risk of substantial and irreparable damage to a competitor (Art. 13).
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