EU State Aid Law and the Northern Ireland Protocol: Extension of the Acquis and the ‘Effect on Trade’

Abstract

EU state aid rules and controls – the EU state aid acquis – and the enforcement of it, are an important part of preserving the EU’s internal market between states in Europe. It is one of the most important means of ensuring equal conditions for traders in the internal market, by preventing states from giving undue advantage to domiciled undertakings, to the ultimate detriment of out-of-state competition, and in turn, depriving local consumers or other choices and opportunities. Moreover, it is about the prevention of anti-competitive behaviour in the marketplace, and reducing distortions (if not eliminating them altogether).

Article 10 of the Northern Ireland Protocol seeks to apply the EU state aid acquis to Northern Ireland with some specificity, in that it points to particulars of both EU primary law and EU secondary law as the applicable legal framework. As uncovered through closer inspection, Article 10 of the Protocol is not just relevant for actors in Northern Ireland, but rather, the United Kingdom and the wider EU as a whole. It is a comprehensive extension of the EU state aid acquis to Northern Ireland following the withdrawal of the United Kingdom from the EU. There is now, for the first time, a part of a former Member State that has kept, in special ways, part of the EU legal order as if it were a Member State.

This Working Paper examines the fundamentals of EU state aid law and the state aid acquis, before turning its attention to Northern Ireland. Such inclusion of Northern Ireland within the state aid acquis was necessary for preserving the integrity of the EU’s internal market. As will be illustrated, the Protocol mandates the full inclusion of the EU state aid acquis, and analyses the ‘effect on trade’ issues involving aid and Northern Ireland.

Keywords: Acquis Communautaire, Effect on Trade, International Agreements, Northern Ireland, State Aid