In June 2025, Advocate General Biondi delivered his Opinion in Case C‑401/24, Swedish Maritime Administration v Stockholms Hamn AB, a reference for a preliminary ruling from the Stockholm District Court (Stockholms tingsrätt) to the Court of Justice of the European Union (CJEU).
The case centres on whether long-standing compensation payments made by the Swedish Maritime Administration to Stockholms Hamn AB – a municipally owned port operator – constitute unlawful state aid under Article 107(1) TFEU.
AG Biondi concludes that the compensation may indeed constitute state aid if Stockholms Hamn AB is deemed an undertaking and the payments conferred a selective advantage not available under normal market conditions. However, he also finds that the aid could still be classified as ‘existing aid’, since it predates Sweden’s EU accession, and was not substantially altered. On the question of ‘new aid’, he considers that automatic five-year renewals and inflation-based adjustments likely do not amount to substantive changes, though he leaves that assessment to the national court.
His Opinion, on the one hand, is a sharp critique of Sweden’s port charging system, identifying systemic failings in transparency, non-discrimination, and cost-reflectiveness, all of which undermine compliance with the Port Services Regulation (Regulation 2017/352). On the other hand, it offers a nuanced outcome. While he supports the Swedish Maritime Administration’s claim that the compensation may be unlawful aid, he simultaneously shields Stockholms Hamn AB by recognising the possibility that the aid is existing aid.
Background and Facts
The dispute concerns the legal classification of long-standing compensation payments made by the Swedish Maritime Administration (Sjöfartsverket) to Stockholms Hamn AB, a port operator, owned by a municipality (Stockholm Municipality).
The origins of the dispute date back to 1979, when Sweden abolished lockage fees for vessels passing through the Södertälje Canal and Hammarby lock—two waterways connecting Lake Mälaren to the Baltic Sea. Prior to this reform, the Swedish Maritime Administration and Stockholm Municipality each levied fees for their respective waterways. These fees were coordinated to avoid distorting traffic flows between the two routes. To maintain this balance and compensate for lost revenue, the Swedish government instructed the Swedish Maritime Administration to enter into an agreement with Stockholm Municipality. Under this agreement, the municipality would cease charging commercial vessels for passage through Hammarby lock in exchange for annual compensation.
The compensation was indexed to inflation and recalculated every five years based on traffic volume. The agreement was automatically renewable unless terminated with six months’ notice. In the early 1990s, the responsibility for the agreement transferred from Stockholm Municipality itself to Stockholms Hamn AB, a company owned by Stockholm Municipality. Payments continued until 2021, when Swedish Maritime Administration unilaterally terminated the agreement and initiated legal proceedings, seeking repayment of approximately SEK 38 million. It argued that the compensation constituted unlawful state aid under Article 107(1) TFEU, as it conferred a selective economic advantage not justified by market conditions.
Stockholms Hamn AB, the municipality-owned company disputed this characterisation. It maintained that the compensation merely offset the loss of revenue from a public service obligation to provide toll-free access to essential infrastructure. It argued that the arrangement satisfied the Altmark criteria, which potentially exempt certain public service compensations from state aid rules, and that the payments should be classified as ‘existing aid’ under Article 1(b)(i) of the State Aid Procedural Regulation (Regulation 2015/1589) concerning the application of Article 108 TFEU, since the agreement predates Sweden’s accession to the EU in 1995.
Moreover, it was apparent that the Swedish Maritime Administration did publish or explain the methodology behind its fee structure. This lack of transparency meant that port operators like Stockholms Hamn AB were unable to verify whether the charges were fair, proportionate, or even lawful.
Opinion of the Advocate General: on the ‘existence’ of state aid
AG Biondi began by outlining the four cumulative criteria for identifying state aid, upon which the measure must: involve state resources (Part A), confer a selective advantage (Part B), distort or threaten to distort competition (Part C), and, affect trade between Member States (Part D). The referring court was particularly uncertain about whether the compensation conferred a selective advantage and whether Stockholms Hamn qualified as an ‘undertaking’ (Part B).
On Part A, the Advocate General emphasised that the classification of an entity as an ‘undertaking’ depends on the nature of the activity, not its legal form or ownership. An undertaking is any entity engaged in economic activity, broadly defined as offering goods or services on a market, even if not for profit. He noted that Stockholms Hamn operates several ports and that Hammarby lock, while not necessarily a port facility, is part of a broader infrastructure network. The lock had previously generated revenue through fees and was later operated toll-free under the compensation agreement. He therefore observed that the lock’s operation could still be considered economic in nature, especially since the compensation was based on traffic volume rather than actual costs. Thus, he concluded that it is for the national court to determine whether the lock operations were economically exploited and whether Stockholms Hamn acted as an undertaking in this context.
On Part B on selective advantage (Point A), the AG explained that any measure that relieves an undertaking of costs it would normally bear under market conditions may constitute an advantage. The compensation agreement provided Stockholms Hamn with a guaranteed income, independent of actual costs or traffic fluctuations, which could be seen as such an advantage. He rejected the argument that the compensation was merely a ‘price’ for a service, noting that the state acted in its public capacity, not as a market operator. The compensation was not negotiated as a commercial transaction, but as a policy response to the abolition of fees.
Stockholms Hamn had argued that the compensation met the Altmark criteria, which exempt certain public service compensations from being classified as State aid. However, the AG stated the four cumulative Altmark conditions: (1) the undertaking must be clearly entrusted with a public service obligation (PSO); (2) the parameters for compensation must be established in advance in an objective and transparent manner; (3) the compensation must not exceed what is necessary to cover costs and a reasonable profit; and (4) if not awarded through public procurement, the compensation must be based on the costs of a well-run, adequately equipped undertaking.
He found that while the first condition might be met (the lock was operated toll-free under a formal agreement), the remaining conditions were doubtful. The compensation was not clearly linked to actual costs, and there was no evidence that it was benchmarked against a typical efficient operator. Thus, the Altmark test likely was not satisfied.
As for Parts C and D, the AG noted that it is not necessary to prove actual distortion of competition, but rather, only that the aid is liable to affect competition. Given that Hammarby lock competes with the Södertälje Canal and potentially with other transport modes, the compensation could influence market dynamics and thus meet this criterion.
Opinion of the Advocate General: non-notified aid as ‘existing aid’?
AG Biondi stated that under Article 1(b)(i) of the State Aid Procedural Regulation (Regulation 2015/1589), aid introduced before accession of a Member State to the EU, and still applicable afterward, is generally considered existing aid.
However, Article 144 of the Act of Accession of Sweden provides that only aid notified to the Commission before 30 April 1995 qualifies as existing aid. For him, AG Biondi argued that Article 144, located in the section on agricultural products should be interpreted narrowly. He supported the view – held implicitly by the Court in prior case-law – that the notification requirement in Article 144 applies only to agricultural aid. Therefore, the lack of notification did not disqualify the compensation from being considered existing aid, provided it was introduced before accession and remained unchanged in substance.
In other words, for him, Article 144 only applies to agricultural aid, not to aid in other sectors like transport or infrastructure. In the case at hand, because the compensation to Stockholms Hamn was not agricultural aid, he concludes that the lack of notification before 30 April 1995 does not matter, as long as the aid was introduced before Sweden joined the EU.
Opinion of the Advocate General: ‘new aid’?
AG Biondi noted that under Article 1(c) of the State Aid Procedural Regulation (Regulation 2015/1589) and Article 4 of the State Aid Implementing Regulation (Regulation 794/2004), only substantial alterations to existing aid (i.e., those affecting its core elements) constitute new aid. Minor or automatic changes, such as inflation adjustments, do not.
Thus, AG Biondi observed that the compensation agreement included mechanisms for periodic recalculation and renewal, and these were implemented according to the original terms. Unless the recalculations involved renegotiations or substantial changes to the formula, they likely did not amount to new aid. However, he left it to the national court to determine whether the five-year extensions were truly automatic, and whether the recalculations involved substantive renegotiation. If so, they might constitute new aid requiring notification.
Opinion of the Advocate General: the port charging framework
AG Biondi identified three major systemic failings in the Swedish port charging framework that, in his view, contravened the principles of the Port Services Regulation (Regulation 2017/352).
First, he highlighted a pervasive lack of transparency. The Swedish Maritime Administration failed to publish or explain the methodology behind its fee structure, leaving port users unable to assess whether the charges were fair, proportionate, or lawful. This opacity undermined legal certainty and erodes trust in public institutions, as economic operators must be able to anticipate the financial and legal consequences of their actions.
Second, AG Biondi pointed to discriminatory practices in the application of port charges. He observed that different ports, including Stockholm, were subject to varying rates without any objective justification, even when the services provided were comparable. Such differential treatment distorts competition, favours certain operators, and violates the EU principle of non-discrimination.
Third, he criticised the failure of the Sweden to ensure that charges reflected actual infrastructure costs. The fees imposed bore no clear relation to the cost of providing or maintaining the infrastructure, raising concerns about overcharging and potential cross-subsidization. This lack of cost-reflectiveness not only breaches the principle of proportionality but also risks distorting trade flows and undermining the efficiency of the EU’s transport network.
Operative part
Operatively, AG Biondi of the view that the Court should rule as follows:
‘Article 107(1) TFEU must be interpreted as meaning that annual compensation which is paid by a State authority to a municipal joint stock company from State resources under an agreement as compensation for that company’s undertaking to provide free of charge a certain service, for which fees were charged until the conclusion of the agreement, may constitute State aid where that company must be regarded, in relation to the service in question, as an undertaking for the purposes of the application of that provision and where that compensation confers on that company an advantage which it would not have obtained under normal market conditions, which is liable to affect trade between Member States and distort competition. It is for the national court to assess, on the basis of all the relevant circumstances, whether and to what extent those conditions are satisfied.
Article 1(b)(i) and (c) of Regulation No 2015/1589 must be interpreted as meaning that, assuming that it constitutes aid within the meaning of Article 107(1) TFEU, such compensation, the payment of which, in accordance with the original terms of the contract which established it, was extended for periods of five years in the absence of notice of termination of that contract and the amount of which was altered, first, annually, on the basis of the consumer price index and, secondly, at the expiry of each five-year period, on the basis of the extent of the service provided free of charge, in accordance with a formula which remained unchanged over time, constitutes, subject to verification by the national court, existing aid within the meaning of those provisions.’
A nuanced assessment
In plain terms, the Opinion of AG Biondi gives neither party much to cheer about. This is because it leans in different directions depending on the legal issue.
On the ‘state aid’ question, AG Biondi suggests that the compensation may constitute unlawful state aid, which supports the Swedish Maritime Administration’s position, given that he doubts that the Altmark criteria are met and sees a potential selective advantage.
On the ‘existing aid’ question, he argues that the compensation could still be considered existing aid, even though it wasn’t notified before Sweden acceeded to the EU. This interpretation favours Stockholms Hamn AB, as it would mean the aid is not automatically unlawful.
On the ‘new aid’ question, he found that automatic renewals and formula-based adjustments likely do not amount to new aid, again leaning in favor of Stockholms Hamn AB
On the ‘port charges’ issue, AG Biondi was critical of the Swedish Maritime Administration, finding that their fee system violates EU law due to lack of transparency, discrimination, and failure to reflect actual costs.
Read the Opinion of the Advocate General
The Opinion of Advocate General Biondi in Case C‑401/24, Swedish Maritime Administration v Stockholms Hamn AB, a reference for a preliminary ruling from the Stockholm District Court (Stockholms tingsrätt) to the Court of Justice of the European Union, delivered in June 2025, can be read here.