Study On EU State Aid Law

The EU state aid law is a high-profile,ambitious legal system designed to achieve EU's reasonable control over state aid measures of member states.Its aim is to prevent the government from distorting market competition through aid measures while maintaining the entire process of EU integration.The EU state aid law is based on Articles 107,108 and 109 of the Treaty on the Functioning of the European Union.After more than six decades of development,it has become a solid,well-regulated and complete legal system,and to a certain extent,presents the characteristics of "the rule of soft law."The EU state aid law started with the EU(European Union)pioneering ideals: peace,prosperity and supranationalism,and thus laid its foundation and tone.From an academic perspective point of view,we can find that the divergence between liberalism and interventionism constitutes the theoretical basis of the state aid law.The double-edged sword effect of aid constitutes the root cause of the existence of state aid law,the competition law which controls state aid constitutes the essential attribute of state aid law,and the reasonable regulation of state aid is the main content of state aid law.EU state aid law is intrinsically linked to EU competition policy: the essence of state aid law is to prevent state aid from damaging market competition and the review of state aid depends on the basic analytical paradigm of competition law.Therefore,the EU regards it as competition policy,paralleling anti-monopoly policy.The EU state aid law applies only to businesses,and assistance to non-enterprises is outside the scope of EU state aid law.Therefore,the identification of enterprises is the premise of understanding and applying the state aid law.Enterprises in EU's context mainly refer to every entity engaged in economic activities regardless of their legal status and source of funds.At present,the EU generally believes that state aid contains four components: the transfer of national resources,the advantages,the selectivity of measures and the impact on competition and trade among member states.In the identification of the transfer of national resources,the EU tends to “accumulate theory”,and the two conditions of “giving national resources” and “attributable to the state” are accumulated to determine whether it constitutes a transfer of national resources or not.The advantages in state aid mainly refers to the improvement of the financial status of a company due to state intervention rather than normal market conditions.For the time being,the European Commission generally judges whether the state support measures give the supported object an advantage through the test of the market economy operator,that is,if the economic interests of the market entity are not available under normal operating conditions,it is considered to have obtained the advantage from the state aid.The advantages.In terms of selectivity,the European Commission has effectively reduced the difficulty of selective identification by distinguishing between its geographical selectivity and object selectivity.The final step in the identification of state aid is the identification of distortions in competition and restrictions on trade.In this step,the EU generally adopts low standards to identify distortions in competition and influence trade.It can be said that distorting competition and influencing trade are basically the inevitable results of giving market participants an advantage.Not all state aid will be banned by the European Commission.Under certain conditions,the relevant assistance can be exempted by the European Commission.The European Commission currently adopts the “common assessment principle”,and aid measures can only be considered compatible with the Treaty on the Functioning of the European Union if all the conditions under the principle of joint assessment are met.These assessment criteria include: assistance must contribute to a clear common interest goal,solve the problem that the market is not self-fulfilling,appropriate policy instruments to achieve common interest goals,incentives,minimum aid limits,and the overall impact of aid is positive and meets transparency requirements.The administrative enforcement of the EU state aid law is carried out by the European Commission with supranational status.The European Commission not only has the right to assess the compatibility of aids of member states,but also to recover unlawful aid measures that do not comply with the EU Operating Treaty.At the same time,the European Commission is also responsible for the day-to-day supervision of state aid.Among them,there is a clear division of powers and responsibilities between the European Commission and member states.The European Court of Justice(including the national courts of member states)is also responsible for the implementation of state aid within its mandate,that is,the right to judicial review of state aid of member states.Article 108,paragraph 3,of the Treaty on the Operation of the European Union constitutes the legal basis for the private implementation of state aid,and more and more member states have strengthened the judicial protection of parties affected by state aid based on the provisions of their domestic laws as well.According to the internal classification criteria within the EU,state aid can be divided into two types: lateral aid and departmental aid.Lateral aid is primarily state aid for non-specific industries,which is generally considered not to be as distorted as departmental aid and is therefore valued by the Commission and used to achieve the Commission's market correction or redistribution policy objectives.The departmental aid is mainly aid for specific departments and industries.The EU's control over state aid doesn't aim at denying state aid completely,but rather at achieving the greatest aid effect with the least amount of fiscal expenditure.The continuous innovation of EU state aid law has always been around this theme.Compared with the EU state aid law,we can find some problems of China's fiscal subsidy policy,such as neglecting the effective analysis of financial subsidies,especially ignoring its negative impact on market competition;neglecting the incentive role of fiscal subsidies;Transparency;lacking access to relief the market participants that are affected by subsidies,etc.Therefore,it is of great significance to strengthen the competition law control over China's financial subsidies.The main measures include:(1)Reconstruction concept: firmly establish the concept of maintaining market competition,coordinating industrial policies and competition policies,and ensuring competition neutrality;(2)Perfecting the system: determining the main body that takes the responsibility of controlling financial subsidies,strengthening the analysis of necessity,appropriateness,effectiveness and initiative of subsidies,and on this basis,improving the exemption mechanism of financial subsidies.(3)Supporting measures: Strengthen supervision mechanism,commitment mechanism,information disclosure mechanism,responsibility mechanism and collaborative governance of judicial review.