ECJ holds that Aid Unlawfully Refused Within Valid Period of Granting Must Be Treated as Existing Aid Despite Later Payment
The Court of Justice (ECJ) has issued its judgment in the case TOODE (C-653/23), clarifying the interpretation of EU state aid rules in a case where Latvian tax authorities had refused COVID-19 crisis aid to a company.
TOODE was denied COVID-19 aid in 2021 for not meeting revenue criteria and later appealed, prompting the referring court to ask whether, under EU law, aid can still be granted after the scheme’s expiry if the right arose earlier, affecting its classification as ‘existing’ or ‘new’ aid.
The ECJ found that Latvian law violates Article 47 of the Charter of Fundamental Rights by preventing aid from being considered “granted” if the administrative act is issued after the aid deadline, even when the refusal was unlawful. It ruled that national courts must disregard such rules and treat aid as granted at the time of the wrongful refusal. The ECJ clarified that aid is considered ‘existing’ if the right to it arose while the scheme was valid, even if paid later by court order after an unlawful refusal.
For more information, see the ECJ’s judgment.