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Massimo Merola and Filippo Caliento

This chapter examines the evolution of the notion of aid under Art. 107(1) TFEU, as interpreted by the EU Court of Justice and applied by the European Commission in its decisions. In particular, the chapter discusses whether the EU Courts’ case law has either ‘broadened’ or ‘shrunk’ the definition of aid, as well as the impact of State Aid Modernisation on such notion. Although Art. 107(1) TFEU has not been amended since the Treaty of Rome, the concept of aid has evolved during the past decade. This is due to the fact that Member States develop new forms of aid to escape the Commission’s compatibility assessment and thus the Court of Justice is constantly required to review the definition of aid in relation to very specific measures, thus undermining the overall consistency of the concept of aid in its case law. In particular, while the General Court has tried to develop new formulae in relation to the notion of aid, in order to adapt it to the new forms of aid measures, the Court of Justice has usually refused such innovative approaches, instead stretching existing legal concepts. Consequently, the rulings of the General Court have often been overruled on appeal, creating legal uncertainty on the notion of aid. The chapter thus concludes that the EU Courts have not consistently either ‘broadened’ or ‘shrunk’ the notion of aid; the case law of the EU Courts has been influenced by the factual circumstances of each case, generating inconsistency and legal uncertainty in the case law.

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Massimo Merola and Marie Debieuvre

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Massimo Merola and Leonardo Armati