{"id":64449,"date":"2021-03-08T03:00:36","date_gmt":"2021-03-08T02:00:36","guid":{"rendered":"https:\/\/www.cde.ual.es\/?p=64449"},"modified":"2021-09-15T11:07:09","modified_gmt":"2021-09-15T09:07:09","slug":"ruling-against-spanish-football-for-alleged-illegal-aid-scheme","status":"publish","type":"post","link":"https:\/\/www.cde.ual.es\/en\/ruling-against-spanish-football-for-alleged-illegal-aid-scheme\/","title":{"rendered":"Ruling against Spanish football for alleged illegal aid scheme"},"content":{"rendered":"
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A Spanish law adopted in 1990 obliged all Spanish professional sports clubs to convert into public limited sports companies<\/strong>, with the exception of professional sports clubs that had achieved a positive financial balance during the financial years preceding adoption of that law.<\/p>\n

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F\u00fatbol Club Barcelona<\/strong>, and three other professional football clubs which came within that exception \u2013 Club Atl\u00e9tico Osasuna, Athletic Club and the Real Madrid Club de F\u00fatbol \u2013 had thus chosen to continue operating in the form of non-profit legal persons and enjoyed, in that capacity, a special rate of income tax.<\/p>\n

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As that specific tax rate remained, until 2016, below the rate applicable to public limited sports companies, the Commission took the view, by decision of 4 July 2016, that that legislation, in introducing a preferential corporate tax rate for the four clubs concerned, constituted unlawful and incompatible State aid<\/strong>, and ordered Spain to discontinue it and to recover the individual aid provided to the beneficiaries of that scheme.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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The action which had been brought by F\u00fatbol Club Barcelona against that decision is definitively rejected<\/strong><\/h3>\n
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Hearing an action brought by FCB against the decision at issue, the General Court of the European Union, by judgment of 26 February 2019, 2 annulled that decision on the ground that the Commission had not proved to the requisite legal standard the existence of an economic advantage<\/strong> conferred on the beneficiaries of the measure at issue.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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In its judgment of 4 March 2021, the Court of Justice, granting the form of order sought in the appeal brought by the Commission, sets aside the judgment under appeal. In support of its appeal, the Commission<\/strong> raised a single ground alleging infringement of Article 107(1) TFEU, so far as concerns, first, the concept of an \u2018advantage capable of constituting State aid\u2019, within the meaning of that provision, and, second, the Commission\u2019s duty of diligence in the context of the examination of the existence of aid, in particular from the point of view of the existence of an advantage.<\/p>\n

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The General Court found that the Commission had not sufficiently assessed whether the advantage resulting from the reduced tax rate could be offset<\/strong><\/h3>\n
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The Court finds, in the first place, that the General Court erred in law<\/strong> when it found that the decision at issue was to be construed as a decision relating both to an aid scheme 3 and to individual aid, since the Commission also expressed its view, in its decision, on the aid individually granted to the four clubs named as beneficiaries.<\/p>\n

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In the present case, the Court observes that the measure at issue concerns such an aid scheme<\/strong>, since the specific tax provisions applicable to non-profit entities<\/strong>, in particular the reduced tax rate, are capable of benefitting, by virtue of that measure alone, each of the eligible football clubs, defined in a general and abstract manner, for an indefinite period of time and an indefinite amount, without further implementing measures being required and without those provisions being linked to the realisation of a specific project. In those circumstances, therefore, the General Court was wrong to find such a fact to be relevant.<\/p>\n<\/div>\n<\/div>\n<\/div>\n

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The Court finds that the error in law<\/strong> thus committed by the General Court<\/strong> vitiates the conclusions which the General Court draws from it as to the extent of the obligations incumbent on the Commission as regards proof of the existence of an advantage.<\/p>\n

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The aid scheme at issue was, from the time of its adoption, liable to favour clubs operating as non-profit entities over clubs operating in the form of public limited sports companies, thereby conferring on them an advantage capable of falling within the scope of Article 107(1) TFEU.<\/p>\n

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Consequently, the Court dismisses the action brought by FCB<\/strong>.<\/p>\n

Further information:<\/h3>\n

Press release-CURIA<\/a><\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

A Spanish law adopted in 1990 obliged all Spanish professional sports clubs to convert into public limited sports companies, with the exception of professional sports clubs that had achieved a positive financial balance during the financial years preceding adoption of that law. 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