The competence of the EC to review State aid measures

State aid in the European Union has become one of the most important areas of competition law, although it is based only on a few provisions of primary EU law. These are Articles 107 and 108 of the Treaty on the Functioning of the European Union, which define the scope of the competence, substance and procedure in this area of law, as well as the institutions responsible for its implementation, including the review of granted state aid. The article focuses on the issues relating to the application of the rules on competence and procedure in order to determine the extent of the powers of the European Commission as regards the freedom to grant state aid and review the competences of EU Member States in that area. The provisions refer rather laconically to the conditions and the scope of granting of state aid, and although they were already included in the founding Treaties of the European Union, their influence remained underestimated. Lately, their importance has grown almost to the level of the constitutional principles of EU law, together with the enhanced activities of the Member States in the field of economic intervention and the Commission’s fight for transparency and enforcement of competition rules in the EU internal market. Thereby, as a result of developments in the case-law and the practice in this field, those provisions significantly restricted the sovereignty of the Member States in the freedom of action pursued in the context of the economic policy of the State, while producing the most far-reaching economic effects. It should be noted that these Treaty provisions apply to any spectrum of state action and that the conditions laid down therein must, in practice, be taken into account during any State intervention.