Aditional Guidance on the Concept of ‘Inextricable Link’ for the Second Time This Week
Today, Advocate General Rantos delivered his Opinion in Tiberis Holding (C- 514/23) concerning a request for a preliminary ruling from the Consiglio di Stato (Council of State, Italy) regarding the interpretation of Article 3 of Directive 2009/28/EC and Article 4 of Directive (EU) 2018/2001 on renewable energy promotion.
The case concerns a negative incentive mechanism within the renewable energy support scheme. Tiberis, a hydroelectric producer, contested a EUR 1.2 million reimbursement demand from Gestore dei servizi energetici (GSE), arguing that the mechanism violates EU law by restricting market price responsiveness.
The referring court is seeking to ascertain whether Articles 107 and 108 TFEU must be interpreted as precluding a national court from assessing the compatibility of the negative incentive mechanism with Article 3 of Directive 2009/28 and Article 4 of Directive 2018/2001, where that mechanism forms part of a State support scheme previously authorised by the Commission.
The Advocate General considered that the referring court lacks jurisdiction to assess the negative incentive mechanism’s compatibility as it is an integral part of Italy’s State aid scheme, previously approved by the Commission. Since the mechanism is indissolubly linked to the aid’s intensity and proportionality, and necessary for its objective or functioning, any ruling on its incompatibility with EU directives could alter the approved scheme and encroach on the Commission’s exclusive competence under Articles 107 and 108 TFEU.
This opinion provides additional guidance on the notion of inextricable link, a complex legal issue which was also discussed by the Court of Justice in the judgment T‑743/21 rendered yesterday (for further details please see our PR).
For more information, see the AG’s opinion.