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Competition Policy

Recovery of unlawful aid

Article 108(3) of the Treaty on the Functioning of the European Union (TFEU) requires Member States not only to notify State aid measures to the Commission before their implementation, but also to await the outcome of the Commission's investigation before implementing notified measures. If, following a formal investigation procedure, the Commission considers the State aid measure incompatible with the internal market, it will require the Member State to recover the aid from the beneficiary (recovery decision). The Member State has to implement the decision in accordance with national law, but leave national provisions unapplied if they stand in the way of effective and immediate implementation of the Commission decision. Actions for annulment against the recovery decision before the European Court of Justice (ECJ) do not have suspensory effect (Article 278 Treaty on the Functioning of the European Union – TFEU). Only the ECJ may, upon application by any party to annulment proceedings, decide to suspend implementation of recovery while court proceedings are pending.

The ECJ has held on several occasions that the purpose of recovery is to re-establish the situation that existed on the market prior to the granting of the aid. This is necessary to ensure that the level-playing field in the internal market is maintained. In this regard, reference is made to Article 16 of Council Regulation (EC) No 2015/1589 of 13 July 2015 laying down detailed rules for the application of Article 108 of the Treaty on the Functioning of the European Union (codification) – the Procedural Regulation - (Codification of Council Regulation (EC) 659/1999 as amended), which governs the procedure on recovery of aid.

See also the Commission Notice on the recovery of unlawful and incompatible State aid C/2091 5396 OJC 247 23.7.2019 p. 1-23

The aid to be recovered pursuant to a recovery decision includes interest and is payable from the date on which the unlawful aid was at the disposal of the beneficiary until the date of its recovery. Article 9 of the Commission Regulation (EC) 271/2008 lays down detailed rules with respect to the method for fixing the recovery interest rate. The method for calculating the reference and discount rates is provided by the Commission Notice on the revision of the method for setting the reference and discount rates. The actual reference rates are publicly available. Member States can obtain a calculator for the recovery interest upon request to COMP-H4@ec.europa.eu.

Finally, the Commission published a Notice on the enforcement of State aid law by national Courts which inter alia clarifies the role of national courts with respect to recovery of unlawful aid. In this respect, reference is also made to the Cooperation with National Courts.

To give information about the Commission's activity in the recovery of unlawful aid, DG Competition updates on a regular basis the information on recovery, download the Excel file below:

State aid recovery statistics
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(219.57 KB - XLSX)
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