This paper aims to provide an overview on negative state aids. The concept of negative state aid has surfaced in some recent judgments of the ECJ. To better understand negative state aids, there is additional context through regular state aids.

First, the notion of state aid is discussed through relevant literature and case-law. The treaty provisions obviously cannot include all relevant tests, principles, exceptions, and practises applied by the courts and the Commission. Some of the most important details are overviewed in this paper.

The selectivity of aid measures is one of the hottest topics in the field of state aid regulation. Cases involving negative state aid are difficult – the concept of them is difficult too. Many undertakings nowadays pursue discrimination and violation of basic freedoms of the EU as secondary claims in state aid cases. Hence, these are touched on.

Negative state aids are measures that grant advantage to undertaking to whom the aid measure is not aimed at. In other words, the negative state aids confer selective disadvantage rather than selective advantage. There are two types of negative state aids. This research concentrates on the rarer one, the existence of which has been concluded by the ECJ once. Basically, to conclude such aid, there must be an overcompensation element and an element of hypothecation on top of regular criteria. Due to the measures’ exceptionality, it must be concluded that more case-law must be created and that national courts must refer cases to the ECJ more bravely.