Black cab only bus lanes a State aid?!

The BIS Guide to State aid says that there are “surprising examples” of things considered by the EC Commission to be a State aid for the purposes of Article 107(1) TFEU. The Court of Appeal have asked the European Court whether the policy of allowing only black cabs, and not also other private hire vehicles  (”PHVs”), into bus lanes at certain times of the day is a State aid: R (Eventech Ltd) v The Parking Adjudicator Case C-518/13. Advocate-General Wahl has said not, thus avoiding any addition to the list of “surprising examples”. His opinion delivered on 24 September 2014 makes clear his view that it is not the case that “the State aid rules are generally concerned with State measures such as the bus lane policy, provided that equal treatment is ensured in respect of comparable undertakings” (see para. 3).

The following discussion on access to infrastructure is illuminating:

“29.      I am of the opinion that — generally speaking — the State aid rules do not specifically require that Member States demand payment for access to such infrastructure, but leave it to their discretion whether or not to grant access free of charge. (12) As an asset in the public domain intended to facilitate transport and mobility for end-users, such infrastructure by its very nature requires that rules be set for its use, including access to it — most evidently in relation to traffic control and maintaining order. That is a regulatory, rather than a commercial, matter of the kind that does not justify the application of the rules on competition set out in Chapter 1 of Title VII of the FEU Treaty, including those on State aid. (13) As the Polish Government points out, Member States may have enacted specific rules for the organisation of traffic. This does not mean that by regulating access to public infrastructure, a resource has been transferred (or indeed forgone).

30.      If, for the sake of argument, the State aid rules were interpreted as generally requiring Member States to charge for access to public infrastructure or State-controlled resources, this might deter States from creating or opening up areas to which there has previously been no, or only limited access. Equally, it might deter undertakings from participating in that process. For example, in the matter under consideration, if black cabs were required to pay for access to bus lanes, that might deter certain of them from requesting access, which might result in access being given only to the economically most resourceful, thus defeating the purpose of the policy.

31.      However, I should stress that the scenario described above in point 29 is the default scenario, which may vary according to the circumstances, and a number of caveats therefore apply. For one thing, specific EU legislation may lay down detailed rules in relation to a particular area. (14)

32.      In addition, when regulating access to infrastructure, the State must evidently act in a genuinely regulatory capacity. That includes regulating comparable situations in the same way so that competition is not distorted. (15) Indeed, where infrastructure is made available to all users on an equal and non-discriminatory basis, that is an indication that no aid has been given to those users. (16) By contrast, if, for example, the State generally requests payment for access to public infrastructure (such as a toll fee for using a public motorway) or other resources in the public domain, but grants various undertakings access free of charge on a discretionary basis, revenue may well be forgone in respect of those undertakings. The NOx case is illustrative in that regard. (17) There, the Netherlands authorities had made certain emission allowances tradable only in respect of large undertakings with a total installed thermal capacity of more than 20 thermal megawatts, as a group, rather than to all emitting undertakings. The Court, finding first that distinction not to be justified by the object and general purpose of a scheme intended to reduce industrial pollution, held that those authorities had forgone resources, as no payment had been made in return for the emission allowances concerned.

33.      Thus, when the State acts in a regulatory capacity, as described above, in respect of access to resources in the public domain, I essentially concur with the Commission and ESA that, provided it treats all comparable undertakings concerned in the same way by establishing the award criteria in advance in a transparent and non-discriminatory manner, the State may legitimately decide not to maximise the revenues which could otherwise have been achieved, without falling foul of the State aid rules.”

The Advocate-General took the view that if TfL was able to show that black cabs and PHVs were not factually and legally comparable then allowing one but not the other access to bus lanes at certain times involved no transfer of state resources (see para. 75). The Advocate-General notes the link between the issue of whether state resources had been transferred and whether equal treatment has been ensures (see para. 35).

The Advocate-General’s discussion of the issue of impact on inter-state trade is also interesting, suggesting that he saw some force in the view that this test had been applied too widely.