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Pier Luigi Parcu, Giorgio Monti and Marco Botta
Since the Treaty of Rome, Art. 107 TFEU has regulated how the Member States can grant aid either to private or State-owned undertakings. Aid measures incompatible with Art. 107(1) may only be authorized by the European Commission if they fulfill one of the conditions mentioned in Art. 107(2) and 107(3) TFEU. Although the wording of the Treaty has not changed significantly over the past 60 years, the goals of State aid policy have progressively shifted. Similar to other free trade agreements, the EU founding fathers included State aid rules in the Treaty of Rome in order to avoid a subsidies war among the Member States—a war that could have distorted free competition within the internal market. State aid rules were thus initially conceived as a complementary instrument to the free movement rules. In addition, State aid law was also complementary to competition policy, since the provisions concerning both policies were included in the same chapter of the Treaty, and were enforced by the same institution—that is, DG Competition of the European Commission.