Courts overturn one-fifth of all state aid decisions
The European Court of Justice regularly overturns a significant number of decisions made by EU competition authorities. One in nine antitrust decisions, and one in five state aid decisions, made by the EU Commission that are taken to the Luxembourg courts prove to be legally unsound.
„Internal statistics show that from 2014 to 2023, the EU Commission was wholly or partially successful in approximately 89% of antitrust and merger cases and around 80% of state aid cases“, outgoing EU Competition Commissioner Margrethe Vestager wrote in a letter to MEP Markus Ferber. Vestager translates these percentages into nominal figures: „In the area of antitrust and mergers, the EU Commission won 456 out of 516 cases during this period.“ For state aid, it was 706 out of 879 cases.
Despite these figures, a look at the rulings shows a mixed picture, particularly regarding aggressive tax avoidance: several decisions against „tax rulings“ – favourable tax deals between companies and tax authorities – challenged by EU competition authorities did not hold up. These include the cases of Fiat in Luxembourg and Starbucks in The Netherlands. Additionally, allegations from Brussels of market abuse against Google Ads were later declared null and void by the Luxembourg judges.
On the other hand, two of the most significant decisions during Vestager's tenure were ultimately upheld by the EU Court in early September: the 2.4 billion euro fine against Google for favouring its own price comparison services, and the 13 billion euros repayment demand from Apple due to the tax ruling in Ireland.
Differing assessments
„I am personally very satisfied with these figures“, Vestager writes. The legal issues in these court cases were often very complex, and the complexity of the topics has increased over the past ten years, „as the enforcement of competition law has penetrated new industries at the technological frontier of our time.“ The Danish commissioner notes that case law ten years ago was not as developed as it is today and adds: „We have gained valuable insights for our enforcement work from the rulings made during this period.“
In contrast, CSU financial expert Ferber has a different assessment. „The Commission's balance sheet only looks good at first glance“, he says. One cannot be satisfied when up to one-fifth of all cases are lost in court. Even a few lost cases can quickly become very costly for taxpayers. „The new Competition Commissioner would do well to be more careful in selecting her cases“, Ferber advises incoming EU Competition Commissioner Teresa Ribera.