LAUSR

State aid policy to banks has developed extensively throughout the financial crisis. After outlining the main features of State aid policy in the banking sector, this article analyses the Kotnik and Dowling judgments where the application of burden sharing arrangements was assessed. In particular, the paper looks at the impact of these judgments on the approach of the Commission on State aid policy and examines the nature of burden sharing arrangements set out in State aid policy. In this context, the paper discusses more generally the relationship between burden sharing arrangements and fundamental rights, in particular the right of property. Then, the article shows that State aid policy to banks still remains highly relevant and controversial in the Banking Union framework where, under certain conditions, Member States can still grant State support measures. This is for instance the case of precautionary recapitalisation as State aid aimed at preventing a bank from going under resolution. Furthermore, the Banking Union framework raises questions such as how burden sharing is related to the Bank Recovery and Resolution Directive (BRRD) and what the relation is between burden sharing and bail-in.