Altmark conditions. In the Altmark judgment, the European Court of Justice held that provided that the following conditions are cumulatively fulfilled, a measure does not confer an advantage on the beneficiary and, thus, does not qualify as state aid in the meaning of Article 87(1) of the EC Treaty, corresponding to the provision of Article 61(1) of the EEA Agreement: – first, the recipient undertaking must actually have public service obligations to discharge, and the obliga- tions must be clearly defined, – second, the parameters on the basis of which the compensation is calculated must be established in advance in an objective and transparent manner, to avoid conferring an economic advantage which may favour the recipient undertaking over competing undertakings, – third, the compensation cannot exceed what is necessary to cover all or part of the costs incurred in the discharge of public service obligations, taking into account the relevant receipts and a reasonable profit for discharging those obligations, – fourth, where the undertaking which is to discharge public service obligations in a specific case, is not chosen pursuant to a public procurement procedure which would allow for the selection of the tenderer capable of providing those services at the least cost to the community, the level of compensation needed must be determined on the basis of an analysis of the costs which a typical undertaking, well run and adequately provided with means so as to be able to meet the necessary public service requirements, would have incurred in discharging those obligations, taking into account the relevant receipts and a reasonable profit for discharging the obligations (2). With regard to the first condition, i.e. the definition of public service obligations discharged to the HFF, it is highly doubtful, in light of the EFTA Court's judgment, that the general loans system of the HFF as defined today fulfils the criteria for qualifying as a service of general economic interest (3). Concerning the second condition, the Court of First Instance of the European Communities (hereinafter ‘the CFI’) recalled in BUPA (4) that the Member States have wide discretion not only when defining a public service mission but also when determining the compensation for the costs, which calls for an assessment of complex economic facts. In the same ruling, the CFI also held that the second Altmark condition requires that the Community institutions must be in a position to verify the existence of object...
