By Paul Adriaanse
On 3 April 2014 the CJEU confirmed the General Court’s judgment of 2 March 2012 in the State aid dispute between the European Commission and the Kingdom of the Netherlands, ING Groep NV and the Dutch Central Bank (De Nederlandsche Bank NV). All six grounds of appeal brought by the Commission in this case were dismissed by the Court. Most notable are the Court’s considerations on the applicability of the private investor test. The Court confirmed that the Commission cannot evade its obligation to assess the economic rationality of a given measure in the light of the private investor test solely on the basis that the measure is connected to a measure which itself already constitutes State aid. Centrally, the decision raises the question as to why the Court sticks to the private investor test in the particular circumstances of the given case. Is the private investor test to be applied by default? Or are there good reasons for the applicability of this test, no matter what?
Directive 94/19/EC on deposit-guarantee schemes, which has also been transposed into EEA law, obliges EU and EEA EFTA states to create deposit-guarantee schemes. Deposit-guarantee schemes reimburse a limited amount of deposits to depositors where their bank has failed. The purpose is to protect a part of depositors’ wealth from bank failures, and thus to prevent depositors from making panic withdrawals from their bank with potentially dire economic consequences. In the present case, the EFTA Court was confronted with an action by the EFTA Surveillance Authority against Iceland. The Authority claimed that Iceland had violated the transposed Directive and thus EEA law in the aftermath of its major economic crisis and collapse of the banking sector in 2008, by failing to ensure that British and Dutch depositors using the famous ‘Icesave’ accounts offered by Icelandic banks received the minimum amount of compensation set out in Article 7(1) of the Directive. In a rather surprising decision handed down on Monday this week, the Court interpreted the Directive very narrowly, effectively finding that Iceland had not failed to comply with its obligations under EEA law. Continue reading