The Legal Impacts of COVID-19 in the Travel, Tourism and Hospitality Industry

14 4.2. Article 107(3)(b) Under Article 107(3) TFEU State aidmay be compatible with the internal market, meaning that the Commission as the competition authority has significant discretion 46 as regards what is allowed for Member States and what not. Point b) of this paragraph allow aid to be granted for important projects of common European interest, but also to “remedy a serious disturbance in the economy of a Member State”. Until the economic and financial crisis beginning in 2008, the Commission used this possibility only occasionally to find State aid compatible with the internal market. Then, in 2008, it adopted the first ever Temporary Framework 47 to allow State aid to be granted for quenching the fires ignited by the crisis. Moreover, the Commission adopted a series of rules for the banking sector, 48 as the excessive risk-taking in this sector was the root of the crisis, having a spill-over negative effect on the real economy. Although the Temporary Framework is not in force any more, banks can receive State aid still under the last modification of the rules applicable for the financial sector, adopted in 2013. Following these developments, it was no surprise that Article 107(3)(b) became a focal point of the State aid law in the fight against the economic impact of the COVID-19 pandemic. All these measures fall under the notification obligation set out in Article 108(3) TFEU. The Commission has to authorize each measure before they are put into effect. Just during the financial and economic crisis, the Commission handles these notifications within a couple of working days (unlike “normal” cases where the notification procedures last for months, sometimes for years). As usual, the Commission applies this exemption also restrictively, and the jurisprudence of the EU Courts supports this approach. 49 This strict application requires to take into account, in particular, the nature and the objective seriousness of the disturbance of the economy of the Member State concerned, on the one hand, and the appropriateness, necessity and proportionality of the aid to address it, on the other. In order to increase transparency and predictability, the Commission can define the detailed compatibility 46 See footnotes 23-24 and the jurisprudence cited there. 47 Source: https://ec.europa.eu/competition/state_aid/legislation/temporary_archive_en.html (accessed on 10 March 2020). 48 Source : https://ec.europa.eu/competition/state_aid/legislation/temporary.html ( accessed on 10 March 2020). 49 See the judgment in case C-431/14 P Hellenic Republic v Commission (ECLI:EU:C:2016:145).