The Durham Company Ltd (t/a Max Recycle) v Durham County Council [2020] EWHC 3200 (Ch)

“(1) It shall be the duty of each waste collection authority— (a) to arrange for the collection of household waste in its area except waste— (i) which is situated at a place which in the opinion of the authority is so isolated or inaccessible that the cost of collecting it would be unreasonably high, and (ii) as to which the authority is satisfied that adequate arrangements for its disposal have been or can reasonably be expected to be made by a person who controls the waste; (b) if requested by the occupier of premises in its area to collect any commercial waste from the premises, to arrange for the collection of the waste; … … (3) No charge shall be made for the collection of household waste except in cases prescribed in regulations made by the (a) to arrange for the collection of household waste in its area except waste— (i) which is situated at a place which in the opinion of the authority is so isolated or inaccessible that the cost of collecting it would be unreasonably high, and (ii) as to which the authority is satisfied that adequate arrangements for its disposal have been or can reasonably be expected to be made by a person who controls the waste; (b) if requested by the occupier of premises in its area to collect any commercial waste from the premises, to arrange for the collection of the waste; … … Secretary of State; and in any of those cases— (a). the duty to arrange for the collection of the waste shall not arise until a person who controls the waste requests the authority to collect it; and (b). the authority may recover a reasonable charge for the collection of the waste from the person who made the request. (4). A person at whose request waste other than household waste is collected under this section shall be liable to pay a reasonable charge for the collection and disposal of the waste to the authority which arranged for its collection; and it shall be the duty of that authority to recover the charge unless in the case of a charge in respect of commercial waste the authority considers it inappropriate to do so.”

“The Claimant has informed me that the prices offered by the Defendant are simply unsustainable for a private company given the costs and overheads involved in waste collection and disposal. The Claimant is not able to compete with the Defendant on price, despite having attempted to do so on countless occasions. The Claimant believes that the reason that the Defendant is able to offer such low prices and therefore win business is due to the fact that it utilises the same infrastructure and resources for collection of commercial waste as it does for household waste; infrastructure and resources which are at least in part, if not entirely, funded by the tax payer. In addition to the infrastructure, the Defendant also benefits from a further tax advantage which is attractive to certain categories of customers, which is the VAT exemption granted to the provision of its services by HMRC.”

“(1) In this rule …, reference to a statement of case includes reference to part of a statement of case. (2) The court may strike out a statement of case if it appears to the court— (a) that the statement of case discloses no reasonable grounds for bringing … the claim; (b) that the statement of case is an abuse of the court’s process or is otherwise likely to obstruct the just disposal of the proceedings; … (3) When the court strikes out a statement of case it may make any consequential order it considers appropriate.”

“The court may give summary judgment against a claimant … on the whole of a claim or on a particular issue if— (a) it considers that—(i) that claimant has no real prospect of succeeding on the claim or issue; … and (b) there is no other compelling reason why the case or issue should be disposed of at a trial.”

“As Ms Anderson QC rightly reminded me, the court must be careful before giving summary judgment on a claim. The correct approach on applications by defendants is, in my judgment, as follows: i) The court must consider whether the claimant has a ‘realistic’ as opposed to a ‘fanciful’ prospect of success: Swain v Hillman [2001] 2 All ER 91; ii) A ‘realistic’ claim is one that carries some degree of conviction. This means a claim that is more than merely arguable: ED & F Man Liquid Products v Patel [2003] EWCA Civ 472 at [8]; iii) In reaching its conclusion the court must not conduct a ‘mini-trial’: Swain v Hillman; iv) This does not mean that the court must take at face value and without analysis everything that a claimant says in his statements before the court. In some cases it may be clear that there is no real substance in factual assertions made, particularly if contradicted by contemporaneous documents: ED & F Man Liquid Products v Patel at [10]; v) However, in reaching its conclusion the court must take into account not only the evidence actually placed before it on the application for summary judgment, but also the evidence that can reasonably be expected to be available at trial: Royal Brompton Hospital NHS Trust v Hammond (No 5) [2001] EWCA Civ 550; vi) Although a case may turn out at trial not to be really complicated, it does not follow that it should be decided without the fuller investigation into the facts at trial than is possible or permissible on summary judgment. Thus the court should hesitate about making a final decision without a trial, even where there is no obvious conflict of fact at the time of the application, where reasonable grounds exist for believing that a fuller investigation into the facts of the case would add to or alter the evidence available to a trial judge and so affect the outcome of the case: Doncaster Pharmaceuticals Group Ltd v Bolton Pharmaceutical Co 100 Ltd [2007] FSR 63; vii) On the other hand it is not uncommon for an application under Part 24 to give rise to a short point of law or construction and, if the court is satisfied that it has before it all the evidence necessary for the proper determination of the question and that the parties have had an adequate opportunity to address it in argument, it should grasp the nettle and decide it. The reason is quite simple: if the respondent’s case is bad in law, he will in truth have no real prospect of succeeding on his claim or successfully defending the claim against him, as the case may be. Similarly, if the applicant’s case is bad in law, the sooner that is determined, the better. If it is possible to show by evidence that although material in the form of documents or oral evidence that would put the documents in another light is not currently before the court, such material is likely to exist and can be expected to be available at trial, it would be wrong to give summary judgment because there would be a real, as opposed to a fanciful, prospect of success. However, it is not enough simply to argue that the case should be allowed to go to trial because something may turn up which would have a bearing on the question of construction: ICI Chemicals & Polymers Ltd v TTE Training Ltd [2007] EWCA Civ 725.”

“The cumulative result of the Court’s interpretation of Article 107(1) is that in order to fall within that Article a measure must satisfy all of the following conditions: (a) there must be aid in the sense of an economic advantage; (b) the advantage must be granted directly or indirectly through State resources and must be imputable to the State; (c) the measure must favour certain undertakings or the production of certain goods (‘selectivity’); and (d) the measure must be liable to distort competition and affect trade between Member States.”

“38. Although State liability is thus required by Community law, the conditions under which that liability gives rise to a right to reparation depend on the nature of the breach of Community law giving rise to the loss and damage. 39. Where, as in this case, a Member State fails to fulfil its obligation under the third paragraph of Article 189 of the Treaty to take all the measures necessary to achieve the result prescribed by a directive, the full effectiveness of that rule of Community law requires that there should be a right to reparation provided that three conditions are fulfilled. 40. The first of those conditions is that the result prescribed by the directive should entail the grant of rights to individuals. The second condition is that it should be possible to identify the content of those rights on the basis of the provisions of the directive. Finally, the third condition is the existence of a causal link between the breach of the State’s obligation and the loss and damage suffered by the injured parties. 41. Those conditions are sufficient to give rise to a right on the part of individuals to obtain reparation, a right founded directly on Community law.”

“51. … Community law confers a right to reparation where three conditions are met: the rule of law infringed must be intended to confer rights on individuals; the breach must be sufficiently serious; and there must be a direct causal link between the breach of the obligation resting on the State and the damage sustained by the injured parties.”

“28B. For the avoidance of doubt, it is averred that a breach of the last sentence of Article 108(3) TFEU is independently actionable under English law as a breach of statutory duty. It is averred that such English breach of statutory duty claim is not subject to conditions for State liability under EU law, as set out in, inter alia, the Brasserie du Pecheur case (the ‘State liability conditions’): see Betws Anthracite Ltd v DSK Anthrazit Ibbenburen GmbH [2003] EWHC 2403 (Comm); by analogy, Garden Cottage Foods Ltd v Milk Marketing Board [1984] A.C. 130 and related cases concerning Article 101 TFEU. 28C. Further or in the alternative, in the event that the State liability conditions apply to the Claimant’s claim for damages by virtue of either English or EU law, it is averred that the Defendant’s breach of Article 108(3) TFEU is sufficiently serious for at least the following reasons: a. Article 108(3) TFEU supports an important rule of EU law, namely, the prohibition on State aid; b. Article 108(3) TFEU is a clear and precise rule of EU law; c. The Defendant’s breach of Article 108(3) TFEU has persisted long after (i) 31 July 2017, when the Claimant first alerted the Defendant to the presence of State aid by cross-subsidy in the conduct of its Commercial Waste Business, by letter from its Solicitors, Tilly Bailey & Irvine LLP, and (ii) 24 October 2018, when the Claimant drew the Defendant’s attention to the judgment of 4 May 2018 of the French-Speaking Court of First Instance of Brussels in case 2017/1957/A, holding that arrangements similar to those obtaining between the Defendant’s Household and Commercial Waste Businesses amounted to State aid for the purposes of Article 107(1) TFEU; d. In light of (d) above, the Defendant’s breach of Article 108(3) TFEU has been deliberate since at least 31 July 2017; alternatively, since at least 24 October 2018; The Defendant has persisted in its breach of Article 108(3) in flagrant disregard for the detrimental economic impacts on the Claimant of the cross-subsidy of between the Defendant’s Household Waste Business and its Commercial Waste Business on Claimant. The Defendant has been aware of such impacts since 21 December 2017.”

“It is common ground between the parties that the last sentence of Article 88.3 [= the last sentence of Article 108(3) of TFEU] has direct effect and parties affected, such as competitors of the entity to whom the aid is being granted, may bring proceedings in the national courts against the State concerned seeking appropriate relief to stop the aid being granted or continued. The Commission has the exclusive right to decide whether aid is compatible with the Treaty, but the national courts have a duty to protect the rights of individuals in cases where there has been a breach of Article 88.3.”

“Mr Brealey [counsel for the claimant] does not contend that as a matter of English Law the recipient of an unlawful aid, who thereby damages a competitor’s business, is liable to the competitor for the damage caused. On the facts, this is not a case which could give rise to one of the economic [‘aiming at'] torts which form part of our law. His case is firmly put on the basis of a Community Law tort.”

“In my view there is no cause of action in Community Law for the claim advanced by Betws. Specifically, there is no cause of action by Betws against Preussag on the ground that Preussag has used unlawful State aid to the detriment of their competitors including Betws.”

“Any abuse by one or more undertakings of a dominant position within the common market or in a substantial part of it shall be prohibited as incompatible with the common market in so far as it may affect trade between member states. Such abuse may, in particular, consist in: (a) directly or indirectly imposing unfair purchase or selling prices or other unfair trading conditions; (b) limiting production, markets or technical development to the prejudice of consumers; (c) applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage; (d) making the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts.”

“This article of the Treaty of Rome (the E.E.C. Treaty) was held by the European Court of Justice in Belgische Radio en Televisie v. S.V. S.A.B.A.M. (Case 127/73) [1974] 1 E.C.R. 51, 62, to produce direct effects in relations between individuals and to create direct rights in respect of the individuals concerned which the national courts must protect. This decision of the European Court of Justice as to the effect of article 86 is one which section 3 (1) of the European Communities Act 1972 requires your Lordships to follow. The rights which the article confers upon citizens in the United Kingdom accordingly fall within section 2 (1) of the Act. They are without further enactment to be given legal effect in the United Kingdom and enforced accordingly. A breach of the duty imposed by article 86 not to abuse a dominant position in the common market or in a substantial part of it, can thus be categorised in English law as a breach of statutory duty that is imposed not only for the purpose of promoting the general economic prosperity of the common market but also for the benefit of private individuals to whom loss or damage is caused by a breach of that duty.”

“… I, for my own part, find it difficult to see how it can ultimately be successfully argued, as M.M.B. will seek to do, that a contravention of article 86 which causes damage to an individual citizen does not give rise to a cause of action in English law of the nature of a cause of action for breach of statutory duty; but since it cannot be regarded as unarguable that is not a matter for final decision by your Lordships at the interlocutory stage that the instant case has reached. What, with great respect to those who think otherwise, I do regard as quite unarguable is the proposition, advanced by the Court of Appeal itself but disclaimed by both parties to the action: that if such a contravention of article 86 gives rise to any cause of action at all, it gives rise to a cause of action for which there is no remedy in damages to compensate for loss already caused by that contravention but only a remedy by way of injunction to prevent future loss being caused. A cause of action to which an unlawful act by the defendant causing pecuniary loss to the plaintiff gives rise, if it possessed those characteristics as respects the remedies available, would be one which, so far as my understanding goes, is unknown in English private law, at any rate since 1875 when the jurisdiction conferred upon the Court of Chancery by Lord Cairns’ Act passed to the High Court. I leave aside as irrelevant for present purposes injunctions granted in matrimonial causes or wardship proceedings which may have no connection with pecuniary loss. I likewise leave out of account injunctions obtainable as remedies in public law whether upon application for judicial review or in an action brought by the Attorney-General ex officio or ex relatione some private individual. It is private law, not public law, to which the company has had recourse. In its action it claims damages as well as an injunction. No reasons are to be found in any of the judgments of the Court of Appeal and none has been advanced at the hearing before your Lordships, why in law, in logic or in justice, if contravention of article 86 of the Treaty of Rome is capable of giving rise to a cause of action in English private law at all, there is any need to invent a cause of action with characteristics that are wholly novel as respects the remedies that it attracts, in order to deal with breaches of articles of the Treaty of Rome which have in the United Kingdom the same effect as statutes.”

“It should not need repeating that Particulars of Claim must include a concise statement of the facts on which the Claimant relies: CPR 16.4(1)(a). The ‘facts on which the Claimant relies’ should be no less and no more than the facts which the Claimant must prove in order to succeed in her or his claim.”

“55. As to the second condition, as regards both Community liability under Article 215 and Member State liability for breaches of Community law, the decisive test for finding that a breach of Community law is sufficiently serious is whether the Member State or the Community institution concerned manifestly and gravely disregarded the limits on its discretion. 56. The factors which the competent court may take into consideration include the clarity and precision of the rule breached, the measure of discretion left by that rule to the national or Community authorities, whether the infringement and the damage caused was intentional or involuntary, whether any error of law was excusable or inexcusable, the fact that the position taken by a Community institution may have contributed towards the omission, and the adoption or retention of national measures or practices contrary to Community law. 57. On any view, a breach of Community law will clearly be sufficiently serious if it has persisted despite a judgment finding the infringement in question to be established, or a preliminary ruling or settled case-law of the Court on the matter from which it is clear that the conduct in question constituted an infringement.”

“139. In my opinion, the decisive factor is whether the error of law at issue is excusable or inexcusable. That characterisation can depend either on the clarity and precision of the legal rule infringed, or on the existence or the state of the Court’s caselaw on the matter.”

“24. The principle of State liability for loss and damage caused to individuals as a result of breaches of Community law for which the State can be held responsible is inherent in the system of the Treaty (judgment in Joined Cases C-6/90 and C9/90 Francovich and Others [1991] ECR I-5357, paragraph 35, and judgment in Joined Cases C-46/93 and C-48/93 Brasserie du Pêcheur and Factortame, not yet published in the ECR, paragraph 31). Furthermore, the conditions under which State liability gives rise to a right to reparation depend on the nature of the breach of Community law giving rise to the loss or damage (judgment in Francovich and Others, cited above, paragraph 38; judgment in Brasserie du Pêcheur and Factortame, cited above, paragraph 38). 25. In the case of a breach of Community law attributable to a Member State acting in a field in which it has a wide discretion to make legislative choices the Court has held, at paragraph 51 of its judgment in Brasserie du Pêcheur and Factortame, cited above, that such a right to reparation must be recognized where three conditions are met: the rule of law infringed must be intended to confer rights on individuals; the breach must be sufficiently serious; and there must be a direct causal link between the breach of the obligation resting on the State and the damage sustained by the injured parties. … 28. As regards the second condition, where, at the time when it committed the infringement, the Member State in question was not called upon to make any legislative choices and had only considerably reduced, or even no, discretion, the mere infringement of Community law may be sufficient to establish the existence of a sufficiently serious breach.”

“36. … Not every breach of community law involves the exercise of a discretion conferred upon a member state. However, the factors that the court may take into consideration in cases not involving exercise of discretion are the same: see Haim v Kassenzahnarzliche Vereinigung Nordrhein [2002] 1 CMLR 247 at para 43. Where no discretion is conferred, the mere infringement of a rule of community law may of itself constitute a sufficiently serious breach, but it will not necessarily do so: Hedley Lomas (above), para 28; Haim, para 41. … 40. As Carnwath LJ observed in Byrne v Motor Insurers’ Bureau [2009] QB 66at paragraph 45, the ‘sufficiently serious’ criterion for Francovich liability is not a hard-edged test, but requires a value judgement by the national court, taking account of the factors listed by the Court of Justice in, inter alia, Brasserie du Pêcheur (above). It is clear from the Luxembourg jurisprudence that in a case such as the present one which does not involve the exercise of a discretion, it is not necessarily enough to give rise to state liability that an error of law has been made. More may be required, and other factors must be considered. …”

“Where does all this lead? In my judgment, it demonstrates that, although there will be some cases where a failure to transpose a specific provision at all by a required date may, without more, amount to a sufficiently serious breach, a bona fide attempt at transposition will attract a more nuanced approach. I am entirely satisfied that the breach of EU law with which we are concerned in the present case does not entitle Mr Negassi to say that he is automatically entitled to reparation. On any view, the United Kingdom's breach was unintentional. It arose from a genuine misapprehension of the true legal position. Whatever may be the reach of automatic entitlement, it does not extend to this case.”

“It follows that Mr Negassi’s claim for damages must be assessed by reference to the multifactorial test for sufficient seriousness, the essence of which is apparent from BritishTelecommunications [1996] 2 C.M.L.R. 217 and Haim [2002] 1 C.M.L.R. 11. In the domestic context, it was the subject of helpful guidance in the speech of Lord Clyde in R. v Secretary of State for Transport Ex p. Factortame Ltd (No.5) [1999] 3 C.M.L.R. 597; [2000] 1 A.C. 524, at pp.554–556. He identified the following as potential factors: (1) the importance of the principle which has been breached; (2) the clarity and precision of the rule breached; (3) the degree of excusability of an error of law; (4) the existence of any relevant judgment on the point; (5) whether the infringer was acting intentionally or involuntarily or whether there was a deliberate intention to infringe as opposed to an inadvertent breach; (6) the behaviour of the infringer after it has become evident that an infringement has occurred; (7) the persons affected by the breach or whether there has been a complete failure to take account of the specific situation of a defined economic group; (8) the position taken by one of the Community institutions in the matter. He added (at p.554B-D) that the application of the ‘sufficiently serious’ test ‘comes eventually to be a matter of fact and circumstance’. ‘No single factor is necessarily decisive. But one factor by itself might, particularly where there was little or nothing to put in the scales on the other side, be sufficient to justify a conclusion of liability.’”

“The evaluation of the seriousness of the breach in the present case seems to me to be quite finely balanced. I have come to the conclusion that, notwithstanding the points in Mr Negassi's favour (the most striking of which was the total exclusion of the subset of applicants for asylum of which he was one), the breach was not of sufficient seriousness to satisfy the test. It was not deliberate. It was the result of a misunderstanding of new provisions in an area of recent EU concern. It was not a cynical or egregious misunderstanding. It was not confined to the Secretary of State. It was shared, as a matter of first impression, by a number of judges. Whilst now all is clear, I do not think that it can be said to have been self-evidently so before the conclusion of ZO. Mr Negassi's fallback position is that at the very least it had become so by the time of the decision of the Court of Appeal in ZO and yet almost another year was to pass before the Secretary of State yielded on the grant of indefinite leave to remain. However, this gives insufficient recognition to the fact that the Secretary of State sought and obtained permission to appeal to the Supreme Court.”

“87. In determining whether any infringement of Article 108(3) is sufficiently serious to give rise to a claim for damages under the Francovich principle, a multi-factorial assessment must be undertaken. The criteria to take into account and weigh up were summarised by the Court of Appeal in R. (on the application of Negassi) v Secretary of State for the Home Department [2013] EWCA Civ 151, [2013] 2 CMLR 45, at [14] as: ‘…(1) the importance of the principle which has been breached; (2) the clarity and precision of the rule breached; (3) the degree of excusability of an error of law; (4) the existence of any relevant judgment on the point; (5) whether the infringer was acting intentionally or involuntarily or whether there was a deliberate intention to infringe as opposed to an inadvertent breach; (6) the behaviour of the infringer after it has become evident that an infringement has occurred; (7) the persons affected by the breach or whether there has been a complete failure to take account of the specific situation of a defined economic group; (8) the position taken by one of the Community institutions in the matter’. 88. In Byrne v Motor Insurers Bureau [2009] QB 66 at [45] Carnwath LJ noted that the ‘sufficiently serious’ test is not hard-edged. It requires a value judgment by the national court, taking into account the relevant factors. 89. Clearly, the State aid rules are important. There is also no discretion conferred on Member States in relation to compliance with them. As regards criteria (2) to (4), it is worth remarking that the limited period for which a tax is in force has not previously been held to be State aid. It is a novel argument, which was presumably not immediately apparent to anyone (bearing in mind that Credit Suisse’s own claim was only made in August 2016). Although the BPT rules were announced with immediate effect, rather than after prior consultation, that was done for obvious reasons relating to forestalling risk, and there was a period following announcement when representations were considered and various changes were made to the scope of the rules to take those representations into account. This point was not raised, and the evidence indicates that it was only after the end date of 5 April had been confirmed, and the Finance Act 2010 had been enacted, that the four banks named at [22] above contacted HMRC to explain that they considered that BPT did not apply to them or had limited effect. 90. As regards criterion (5), whilst the legislation was obviously intentional, and resulted from deliberate policy choices, there was clearly no deliberate intention to infringe, and indeed advice was taken from experienced Counsel about the possible State aid risk in respect of other aspects of the rules, without the point being picked up. Importantly, there was clearly no intention to confer an advantage on Untaxed Banks, unlike, for example, the facts of R. v Secretary of State for Transport Ex p. Factortame Ltd (C-48/93) [1996] 1 CMLR 889, where the Government’s intention was to protect fishing communities. 91. Mr Robertson submitted that Mr Peretz’s advice (privilege in respect of which had been waived) was that the State aid position was not risk free, and therefore the proper course was to notify the Commission. I disagree. First, the point does not assist Credit Suisse because the risks being considered related to other aspects of the rules. Secondly, as confirmed by Ms McGeehan’s evidence the Government takes a risk-based approach in relation to State aid, and will not notify a measure just because it is told that there is some element of risk. That seems to me to be a reasonable and proportionate approach to take where substantial risk is not identified. Ms McGeehan’s recollection was that they had concluded based on the legal advice, and taking account of the rationale for the tax, that notification was not required. 92. As regards (7), there was no failure to take account of the position of the Taxed Banks: banks paying bonuses during the period of operation of BPT were the target of the measure. As regards (8), it appears that Credit Suisse have not complained to the Commission. In any event the Commission has expressed no view. 93. In all the circumstances I would conclude that, if there were State aid, there would be no ‘sufficiently serious’ breach to justify an award of damages for consequential losses, and would therefore decide Issue 4 in favour of HMRC.”

“Clearly, the State aid rules are important. There is also no discretion conferred on Member States in relation to compliance with them.”

“As can be seen from this, there are a number of elements to selectivity. In particular: a) it must be determined whether the measure favours certain undertakings (or sectors) over others; b) those undertakings must be in a ‘comparable factual and legal situation’; c) whilst a tax advantage can constitute State aid, it will not do so if it results from a general measure applicable without distinction to all economic operators; d) the starting point is to identify the ordinary or ‘normal’ tax system, and then determine whether the tax measure is a derogation from that system; e) the question whether undertakings are in a comparable factual and legal situation must be determined in the light of the objective pursued by the ordinary tax system; and f) even if a measure is a priori selective, there will be no State aid where the Member State shows that the differentiation in treatment flows from the ‘nature or general structure’ of the system.” a) it must be determined whether the measure favours certain undertakings (or sectors) over others; b) those undertakings must be in a ‘comparable factual and legal situation’; c) whilst a tax advantage can constitute State aid, it will not do so if it results from a general measure applicable without distinction to all economic operators; d) the starting point is to identify the ordinary or ‘normal’ tax system, and then determine whether the tax measure is a derogation from that system; e) the question whether undertakings are in a comparable factual and legal situation must be determined in the light of the objective pursued by the ordinary tax system; and f) even if a measure is a priori selective, there will be no State aid where the Member State shows that the differentiation in treatment flows from the ‘nature or general structure’ of the system.”

“Despite the number of cases which have addressed the selectivity condition, it remains the most difficult of the State aid conditions to apply in practice, and the assessment of selectivity has thus been described as ‘a difficult exercise with an uncertain outcome’. The basic problem is that not every measure that can be described as producing an advantage for one or more groups of undertakings over others is regarded as selective within the meaning of Article 107(1). Rather, the case-law of the Court has distinguished two particular situations where a measure with differential effects may nevertheless escape classification as aid on the basis of a selectivity analysis: the favoured undertakings may not be comparable, properly speaking, to the non-favoured group; and the different treatment may be justified by the nature and scheme of the relevant system. To address those issues a three stage analysis of selectivity has emerged for complex cases (particularly tax cases). First, the relevant reference system must be identified. Secondly, it must be established whether the measure is prima facie selective, in light of that reference system. The third question is whether the measure is justified by the nature of the scheme. … It should be emphasised, however, that it is not necessary to address all three stages in every case: in most cases, the prima facie selectivity of the measure will be obvious without having to look at a reference framework; and the ‘nature or scheme’ issue will only arise to the extent that this is advanced as a justification by the relevant Member State.”

“54. … [I]t must be recalled that Article 107(1) TFEU prohibits State aid ‘favouring certain undertakings or the production of certain goods’, that is to say, selective aid (the judgment in Mediaset v Commission, C‑403/10 P, EU:C:2011:533, paragraph 36). 55. It follows from the Court’s settled case-law that Article 107(1) TFEU requires an assessment of whether, under a particular legal regime, a national measure is such as to favour ‘certain undertakings or the production of certain goods’ in comparison with others which, in the light of the objective pursued by that regime, are in a comparable factual and legal situation (the judgment in Mediaset v Commission, EU:C:2011:533, paragraph 36). … 61. It follows [i.e. from the facts set out] that Black Cabs and minicabs are in factual and legal situations which are sufficiently distinct to permit the view that they are not comparable and that the bus lanes policy therefore does not confer a selective economic advantage on Black Cabs. … 63. In the light of all the foregoing, the answer to the first and second questions is that the practice of permitting, in order to establish a safe and efficient transport system, Black Cabs to use bus lanes on public roads during the hours when traffic restrictions relating to those lanes are operational, while prohibiting minicabs from using those lanes, except to pick up and set down passengers who have pre-booked such vehicles, does not appear, though it is for the referring court to determine, to be such as to involve a commitment of State resources or to confer on Black Cabs a selective economic advantage for the purpose of Article 107(1) TFEU.”

“Where a local authority [‘LA’] that is a Waste Collection Authority [‘WCA’] for the purposes of the Environmental Protection Act 1990 [‘EPA 1990’] is making supplies of trade waste collection services to business customers (i.e. entities occupying non-residential property) in its area, are those supplies by the LA ‘activities in which it is engaged as a public authority’ within the meaning of section 41A(1) of the Value Added Tax Act 1994 [‘VATA 1994’] and/or Article 13(1) of the Principal VAT Directive [‘Article 13(1)’ and ‘PVD’]?”

“TDC contends that the LAs engaging in the activity of trade waste collection services are not doing so ‘as public authorities’ within the meaning of Article 13(1). In accordance with the case law of the CJEU, that phrase has been interpreted to mean that the authority must be acting under what it has described as a ‘special legal regime’. TDC contends that a LA which has chosen effectively to ‘go into the business’ of providing trade waste collection services, doing so in competition with private sector operators, is not thereby acting in its capacity as a local authority, but rather is engaging in an activity which is equally open to a private sector operator under the same (or essentially the same) legal conditions.”

“A LA has wide social responsibilities which a private sector operator does not, responsibilities which include statutory duties. Its purposes in providing a particular service may be to fulfil those responsibilities. The service is not, in those circumstances a commercial purpose.”

“… I consider that LAs have no power to provide commercial waste collection services on a commercial basis other than through a company. … If LAs are acting within their powers in providing directly, and not through a company, the services which they have, then the only available power is to be found in section 45(1)(b) EPA 1990.”

“103. I have no doubt that section 45(1)(b) EPA 1990 is, or at least is capable of being, a ‘special legal regime’. This is demonstrated by consideration of a LA which provides a commercial waste collection service only if requested to arrange for such collection by an occupier of premises and does so for a reasonable charge which, taking the provision of the service to occupiers generally, results only in cost recovery and no surplus. … Indeed, TDC itself does not deny that a LA that is actually arranging a collection in response to a request under section 45(1)(b), and then levying a charge under section 45(4) for the reasonable costs of that collection, may be ‘acting as a public authority’. “103. I have no doubt that section 45(1)(b) EPA 1990 is, or at least is capable of being, a ‘special legal regime’. This is demonstrated by consideration of a LA which provides a commercial waste collection service only if requested to arrange for such collection by an occupier of premises and does so for a reasonable charge which, taking the provision of the service to occupiers generally, results only in cost recovery and no surplus. … Indeed, TDC itself does not deny that a LA that is actually arranging a collection in response to a request under section 45(1)(b), and then levying a charge under section 45(4) for the reasonable costs of that collection, may be ‘acting as a public authority’. 104. Since it cannot be said that section 45(1)(b) is not ever capable of constituting a special legal regime, it must follow, even on TDC’s case, that whether any particular LA is acting as a public authority will depend on the facts relevant to that LA. … 105. It is therefore impossible, even on TDC’s case, to answer the preliminary issue with the answer ‘No’ (so that the VAT derogation does not apply) since there are at least some, and may be many, LAs who are not to be regarded as taxable persons in relation to supplies of commercial waste collection services. The answer, on TDC’s case, would have to be ‘it all depends’. 106. However, once it is accepted, as it must be, that section 45(1)(b) EPA 1990 is capable of constituting a special legal regime in some cases, then in my view any activities carried out by a LA pursuant to that special legal regime fall within the VAT derogation, subject always to the competition proviso. As the cases show, the only criterion making it possible to distinguish with certainty between activities as a public body and activities subject to private law is ‘the legal regime applicable under national law’. I accept, of course, that not every activity carried on by a LA is subject to a special legal regime simply because some statutory basis has to be found for that activity. But once a legal regime has been identified as a special legal regime in accordance with the case-law, it would defeat the purpose of that clear criterion – namely to provide a clearly and readily applicable test – to require national courts to enter into a further enquiry as to whether particular activities within that legal regime are entitled to the benefit of the VAT derogation. … … 109. The preliminary issue is to be answered in the sense that, where a LA is making supplies of trade waste collection services to business customers in its area and does so in the performance of its duties under section 45(1)(b) EPA 1990, the supplies are ‘activities in which it is engaged as a public authority’ within the meaning of section 41A(a) VATA 1994 and Article 13(1). Whether a LA is in fact providing its commercial waste collection services under section 45(1)(b) is a matter to be determined on the facts of each case.”

“An aid to an individual undertaking is obviously selective …”

“A measure is prima facie selective if it produces advantages exclusively for certain undertakings or certain sectors of activity. As noted above, this will normally be the case where aid is granted to a single undertaking” (my emphasis). The footnote observes that “some cases of measures of individual application may require a more complex assessment by reference to a relevant reference framework, such as individual tax rulings”