Krämer, Rike; Krajewski, Markus --- "State Aid (Subsidies) in International Trade Law" [2011] ELECD 714; in Szyszczak, Erika (ed), "Research Handbook on European State Aid Law" (Edward Elgar Publishing, 2011)

Book Title: Research Handbook on European State Aid Law

Editor(s): Szyszczak, Erika

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781849802741

Section: Chapter 18

Section Title: State Aid (Subsidies) in International Trade Law

Author(s): Krämer, Rike; Krajewski, Markus

Number of pages: 21

Extract:

18 State aid (subsidies) in international
trade law
Rike Krämer and Markus Krajewski


No question in international trade law is as contentious, and as complicated, as
the question of subsidies. Andreas F. Lowenfeld1



I. INTRODUCTION

European Union law on State aid cannot be seen in clinical isolation
from other transnational regimes applicable to governmental support for
domestic economic actors. In particular, as a Member of the World Trade
Organization (WTO), the EU must adhere to the rules of the multilateral
trading system which apply to subsidies, the term of art for State aid in
the WTO context. State aid in the European context is embedded in a
multilevel system of disciplines and exceptions determining the legality
of governmental support measures and the reactions of States, interna-
tional institutions and economic actors to these measures. This has three
important practical consequences.
First, support measures of EU Member States must not only adhere
to EU State aid law, but are also subject to the WTO provisions on sub-
sidies. WTO law is an integral part of EU law and therefore binding on
the Member States of the EU (Article 216(2) TFEU). It has the same
legal supremacy over domestic law as primary and secondary EU law.
Furthermore, all EU Member States are also Members of the WTO and
are therefore bound by these rules also in their own right. As a conse-
quence, the legality of a support measure or the possible consequences
of that measure may not only depend ...