State Aid and R&D&I Public Procurement: An Uneasy and Unclear Relationship

This article examines the uncertain and often uneasy relationship between State aid law and public procurement of/for innovation (PPI) in the EU legal framework. The legal assessment of such PPI under State aid rules, particularly regarding the notion of advantage, and under State aid compatibility, presents numerous challenges. The paper explores key legal constructs – the presumption of adherence to market conditions, the Market Economy Operator Principle (MEOP), and the ‘real needs’ doctrine – and finds that each struggles to fully accommodate the logic and characteristics inherent in PPI. Complexity can arise from various sources and can cause issues for the assessment, under State aid, of PPI.While compatibility avenues exist, including under the GBER and the R&D&I Framework, they fail to address the practical realities of PPI. The article thus argues that the applicable legal framework, both on the prohibition and on the compatibility sides, struggles to accommodate the logic of PPI, concluding that reform seems the most obvious answer.