硕士论文英文 Examining The Incentive Effect Of State Aid
Phedon Nicolaides: Re-introducing the Market in the “Market Economy Investor” Principle, European State Aid Law Quarterly 2003, 5p.
COM invented this principle almost 20 years ago (1983) to deal with injections of public capital, which cannot be prohibited by virtue of Article 295 EC (Art. 345 TFEU) to determine whether public investments contain state aid.
The author considers 3 observations:
the term “market economy investor” is a misnomer;
ex-post assessment may undermine the principle itself;
it is necessary to “re-introduce” market.
Firstly, the COM compares the actions of the public authority with those of a “typical” private investor in a similar situation (in terms of the size, risk and terms of investment) – see landmark cases C-234/84 Belgium v. COM, C-40/85 Belgium v. COM, C-305/89 Italy v. COM, C-278/92 Spain v. COM, T-228/99 WestLB v. COM). In some cases (recovery of debt, rescheduling of debt OR closure of factories) the ECJ invented term “private creditor” (T-152/99, C-334/99 C-342/99, C-256/97). In these conditions there are no comparable market benchmarks (every case is different): Creativity and ingenuity are as important as toughness and persistence in negotiations. That is why successful corporate bankers command huge salaries. Since public authorities are not known for their foresight and investments skills, it is hard to believe that public officials can negotiate as well as private investors. It is not a case of comparing agreed rates with market rates.
Secondly, as the landmark WestLB judgement clarifies, a private investor will demand a return on his investment that reflects all the benefits obtained by the recipient of his funds and will take into account all foreseeable future contingencies. Private investor always looks forward: “bygones are bygones”. The author criticizes the judgement T-98/00 Linde v. COM, because a reasonable investor would never obliged himself to provide the privatised company with certain (chemical) product for a period of ten years at market prices. The German authorities argued, that when the agreement was made it was hoped that a second user of that chemical would build a plant in the area (PN: how reasonable was that expectation?). But the CFI found further payments to prevent much larger cost justified. The author agrees with the judgement C-334/99 Germany v. COM: “public authorities may not create costs for themselves which can justify the granting of additional state aid later on”, because ECJ correctly observed that Germany has included in the cost of closure the repayment of state aid that had been granted earlier.
Thirdly, private money is not the same as public money. Private investor is willing to tolerate less. There are 3 solutions:
the MS should have independent investor advisor to assess the deal;
the MS should use private intermediary for negotiations;
to adjust upwards the rate of return demanded for public funding (in comparison to private investor).
The proposed measures are not discriminatory (Art. 345 TFEU), because public investment is not the same as private investment. The officials are not dealing with their own money, so the due diligence is not the same.
The “market economy investor” principle has been narrowed to only “private investor” principle. Once the “market” drops out, it is difficult to identify any hidden state aid.
R. Meiklejohn (ed.): State aid and the single market, 1999, European Commission, 206 p. [4] (in the syllabus from the first semester only Synopsis and Chapter 1: The Economics of State Aid were present: p.7-32)
http://www.tu-dresden.de/wwbwleeg/publications/hirschhausen_roeller_european_economy_state_aids_0399en.pdf
This publication contains 7 studies by several authors on several issues. Because the documents is quite old, I will summarize only briefly the synopsis:
Economics of State Aid (Meiklejohn)
State aid should prevent market failures. Perfect competition is based on radical assumptions (perfect information and foresight, perfect factor mobility, no economies of scale, no externalities). In real world government intervention may increase total welfare.
We consider 8 market failures: public goods; merit goods; increasing returns to scale; externalities (positive and negative); imperfect or asymmetric information (SMEs and innovative firms looking for capital on capital markets); institutional rigidities (e.g. labour market); imperfect factor mobility; subsidisation of foreign competitors. Income redistribution constitutes an additional reason for government intervention.
Intervention must be carefully considered to minimise distortions of competition, evasion, abuse OR the creation of perverse incentives. Government expenditure has to be financed, which is likely to lead to some loss of efficiency in other parts of the economy.
The instrument can be chosen from wide panoply including: regulation; direct government provision of certain goods or services; taxation OR state aids. (effectiveness)