Monthly Archives: October 2015

The EU’s Response to the Refugee Crisis: Ideas from the G20 Youth Summit

Nicola Del Medico, 8 October 2015

The flow of refugees to the shores and borders of the EU member states is putting to the test their ability to show solidarity and protect the rights of thousands of human beings. This challenge recently made its way on the UN agenda, and it is growing in relevance also within the G20, which does not formally deal with peace and security and maintains an economic and financial focus.

On 16-21 August 2015, the Syrian refugee crisis was discussed by the G20 Youth Summit (the so-called Y20) on the initiative of the Turkish presidency, which is particularly sensitive to an emergency that is impacting heavily not just on European countries but also on Syria’s neighbours, including Turkey. Continue reading

Should State Aid that Is Passed on to Consumers Not be Recovered?

Phedon Nicolaides, 6 October 2015

On 5 February 2015, the General Court, in cases T-473/12, Aer Lingus v Commission and T-500/12, Ryanair v Commission, partly annulled Commission Decision 2013/199. In that decision the Commission found that a lower tax on air travel in Ireland that applied to flights that were essentially domestic was state aid. The Commission concluded that the aid was incompatible with the internal market and had to be recovered. The amount that had to be recovered was the difference between the lower and the standard rate of tax for all other flights from Ireland [which was EUR 8 per passenger] multiplied by the number of passengers who bought tickets taxed at the lower rate.

The two airlines argued that the Commission was wrong to demand recovery of the full amount of the tax difference because they had passed it on to passengers in the form of cheaper tickets. Surprisingly, the Court agreed with that point of view. It censured the Commission because “116 … inasmuch as the economic advantage resulting from the application of that reduced rate could have been, even only partially, passed on to the passengers, the Commission was not entitled to consider that the advantage enjoyed by the airlines amounted automatically, in all cases, to EUR 8 per passenger.”

When the judgment was issued I wrote an article criticising it for misinterpreting the concept of advantage and for misunderstanding how airlines could exploit the reduced tax even they could pass it on to passengers.[1] If the two airlines were passing all aid to passengers why did they bother to receive it in the first place? Surely they were not acting selflessly. Continue reading