European Competition Law provides a wide-ranging review of the European rules relating to competition: restrictive agreements, abuse of a dominant position, impact of intellectual property rights, procedure, merger control, State aid.

European Competition Law

An aid to make good the damages caused by natural disasters or exceptional occurrences is compatible ipso jure with the internal market where the causal event is exceptionally serious  and the aid paid is directly connected with the damage caused.
Regardless of the significance of damages, earthquakes, floods, avalanches and landslides constitute natural disasters, and war, internal disturbances a …

Natural disasters and other exceptional occurrences

An aid to make good the damages caused by natural disasters or exceptional occurrences is compatible ipso jure with the internal market where the causal event is exceptionally serious  and the aid paid is directly connected with the damage caused.

Regardless of the significance of damages, earthquakes, floods, avalanches and landslides constitute natural disasters, and war, internal disturbances and strikes  and, with certain reservations, nuclear accidents  and fires, constitute exceptional occurrences. Adverse weather events, such as hail, ice, frost, rain or drought, may be assimilated to natural disasters where damages affect for each of the recipients of the aid at least 30% of normal production - outside less-favored areas - calculated by reference to the preceding three years .

The EU authorities require a direct causal link between the aid granted and the damages connected with the disaster . The Commission must verify whether the event giving rise to the damage is really the determining cause of the damage caused to the beneficiary of the aid in question or whether, on the contrary, part of this damage was due to the beneficiary's pre-existing difficulties . Consequently, only economic disadvantages directly caused by natural disasters or exceptional events may be compensated under Article 107(2)(b) . Accordingly, aid measures consisting of a reduction in taxes normally due in the context of income tax on capital gains implemented on the sale of agricultural land, which are essentially favorable to farmers, cannot be justified by the rise in fuel prices in the absence of a direct causal link with the damage caused by this supposedly exceptional event .

The mere fact that aid under Article 107(2)(b) TFEU is granted to only one of several undertakings potentially affected by the exceptional occurrence in question does not necessarily mean that the aid is aimed at objectives other than those pursued by that provision, or that it is granted arbitrarily . Moreover, nothing obliges a Member State to remedy all the damage caused by an exceptional occurrence, and thus to grant aid to all the victims of such damage . Consequently, the aid scheme for the benefit of airlines having their principal place of business in the Member State granting the aid, which establishes a difference in treatment to the detriment of airlines whose place of business is in another Member State but which operate in or to the territory of the Member State in question under the freedom to provide services and the freedom of establishment, is not contrary to Article 107(2)(b) TFEU insofar as the purpose of the scheme is to remedy, in the aviation sector, the damage resulting from the exceptional occurrence resulting from the transport restriction and containment measures adopted by the Member State in question to deal with the COVID-19 pandemic   . Aid based on Article 107(2) may also be granted to an undertaking classified as a firm in difficulty within the meaning of the guidelines on State aid for rescuing and restructuring firms in difficulty, other than financial institutions, provided that this status does not in itself give rise to any overcompensation which would prevent it .

Lastly, the amount of the compensation must be precisely and objectively assessed since the aid must not exceed the strict amount of damages actually suffered .

In order to increase legal certainty for Member States, Regulation No 651/2014 , which lays down the rules for block exemption for State aid, defines the types of events constituting natural disasters falling within its scope of application. Article 50 thus provides that “aid schemes to make good the damage caused by earthquakes, avalanches, landslides, floods, tornadoes, hurricanes, volcanic eruptions and wild fires of natural origin shall be compatible with the internal market within the meaning of Article 107(2)(b) of the Treaty and shall be exempted from the notification requirement of Article 108(3) of the Treaty”. The grant of aid is subject to two conditions: the competent public authorities of a Member State must have formally recognized the character of the event as a natural disaster and there must be a direct causal link between the natural disaster and the damages suffered by the affected undertaking. Aid schemes must be introduced within three years following the occurrence of the event. 

Commission Decision No 91/175/EEC of 25 July 1990, Aid provided for in Italian law No 120-87, LawLex200500004572JBJ: an aid taking place several years after a disaster, which is intended to favor the industrial development of certain regional areas affected, cannot benefit from the exemption laid down in Article 107(2)(b) TFEU where the problems of the affected areas no longer have the seriousness, urgency or specificity to justify the adoption of further extraordinary measures such as those already provided for.

Commission Decision No 96/148/EC of 26 July 1995, French road network, LawLex201000001195JBJ.

Case T-259/20 Ryanair DAC, Judgment of 17 February 2021, LawLex202100004881JBJ: which states that this scheme, which seeks to compensate victims' harm not on the basis of their nationality but on the basis of the institutional link with the place where the damage caused by the transport restriction and confinement measures occurred, i.e. the place of the main establishment, enables the Member State concerned to ensure a lasting link between itself and the beneficiary airlines, confirmed in Case C-210/21 P Nippon Chemi-Con Corporation, Judgment of 13 July 2023 , LawLex202400004665JBJ.

Case T-111/21 Ryanair DAC, Judgment of 9 November 2022, LawLex202200009636JBJ, which states that the fact that the aid was granted in breach of the obligation of prior notification does not constitute an indication of overcompensation since the authorities justify having granted the disputed aid without waiting for the Commission's approval because of the urgent nature of the beneficiary undertaking's needs during the Covid-19 pandemic; Case T-332/21 Wizz Air Hungary Légiközlekedési Zrt., Judgment of 18 October 2023, LawLex202400004746JBJ.

See Case C-73/03 Spain v Commission, Judgment of 11 November 2004 (Unpublished) [2004]; Case C-320/21 P Ryanair DAC, Judgment of 28 September 2023, : in order to determine whether there has been overcompensation for the damage suffered as a result of the exceptional occurrence in question by an airline which has benefited from aid in the form of a guarantee, account must be taken of the amount which corresponds, in principle, to the difference in rate granted with or without the measure in question at the date of adoption of the judgment.

Regulation No 651/2014 of 17 June 2014 declaring certain categories of aid compatible with the internal market in application of Articles 107 and 108 of the Treaty.

In countries which have not been directly affected, the dioxin crisis does not constitute an exceptional occurrence justifying the payment of an aid to poultry undertakings where the only unforeseeable factor that created disruption on the market was the spreading of alarm among consumers and their reaction: Commission Decision No 2007/52/EC of 19 May 2004, Poultry Farms, LawLex200700000301JBJ.

Commission Decision No 2004/89/EC of 9 July 2003, Aid scheme implemented by Italy for natural disasters, LawLex200500004586JBJ. See also Community Guidelines No 2000/C 28/02 of 1 February 2000 for State aid in the agriculture sector.

See Case C-278/00 Greece v Commission [2004] ECR 3997, LawLex200500004503JBJ; Case C-73/03 Spain v Commission (Unpublished) [2004]; Case T-268/06 Olympiaki Aeroporia Ypiresies v Commission [2008] ECR II-1091, LawLex200900000063JBJ.

Case T-225/21 Ryanair DAC, Judgment of 18 October 2023, LawLex202400004747JBJ.

Case T-332/21 Wizz Air Hungary Légiközlekedési Zrt, Judgment of 18 October 2023, LawLex202400004746JBJ.

Commission decision No 2003/293 of 11 December 2002, Increase in fuel prices  LawLex200500005334JBJ; Case C-73/03 Spain v Commission, (Unpublished) [2004].

Case C-320/21 P Ryanair DAC, Judgment of 28 September 2023,  , which specifies that several aid measures may be adopted by a Member State on the basis of the various derogations provided for in Article 107(2) and (3) TFEU, in respect of the same event, such as the Covid-19 pandemic, which may be qualified as both an exceptional occurrence and an event giving rise to a serious disturbance in the economy.

Case T-142/21 Wizz Air Hungary Légiközlekedési Zrt. (Wizz Air Hungary Zrt.), Judgment of 29 March 2023, LawLex202300004515JBJ.

European Competition Law

398. Natural disasters and other exceptional occurrences

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398. Natural disasters and other exceptional occurrences

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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au contenu exclusif Livv – juristes d’entreprise