Special Charges – a Gap in European Competition Law?

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Whilst the prohibition of tax relief in favour of “certain undertakings or the production of certain goods” as stipulated in Art.87(1) EC Treaty has attracted considerable institutional attention, the treatment of fiscal special charges to the disadvantage of “certain undertakings or the production of certain goods” has neither been regulated in the EC Treaty, nor has it been in the focus of the European Commission and the European Court of Justice. The recent Court of Justice’s judicature revealed first signs of a tendency to regard special charges as the logical counter piece of state aids and to expand the constituent elements of this norm to include a comprehensive control of “differences in burden”. However, following the jurisprudence on Art.4 lit.c ECSC from 1951, which expressly acknowledged the common features of subsidies and aids on the one hand and special charges on the other hand, it seems methodically more coherent to differentiate between state aids and special charges and to define these as advantageous or disadvantageous divergences from the “standard measure” of taxation. Against this background, the article examines whether and to which extent the existing EC-prescriptions are opposed to such disadvantageous fiscal charges. As the analysis reveals, special charges can neither be seen as a distortion of the Common Market under Art.96 et seq. EC, nor does the methodical differentiation between state aids and special charges leave room for an immediate application of Art.87(1) EC. However, there are good reasons to draw an analogy: An interpretation of Art.87(1) EC in the light of the fundamental concepts of Community Law as laid down in Art.2 et seq. EC, which aim at ensuring that “competition in the internal market is not distorted within the single market”, suggests that a “judicial extension is of the law” is possible as long as one is sympathetic to the “effet utile” of the contractual norms and their dynamic interpretation.