Martijn van de Hel is representing MKB Multifunds in appeal proceedings before the General Court of the European Union against a decision of the European Commission (the “Commission”). The reason for the appeal is the complaint filed with the Commission by MKB Multifunds on the grounds of unlawful state aid provided by the Dutch Ministry of Economic Affairs to Dutch Venture Initiative (“DVI”), a fund-of-funds initiative.
The founders of MKB Multifunds wish to make Dutch SMEs more appealing to institutional investors by setting up a Fund-of-Funds: MKB Multifunds. MKB Multifunds aims to invest in Dutch SMEs together with Dutch pension funds. The Dutch government is the founder and initiator of DVI. Via PPM Oost, a development agency (currently named Oost NL), the Ministry of Economic Affairs is investing in SMEs via DVI. The Ministry of Economic Affairs holds shares in PPM Oost and is in charge of its day-to-day management. DVI invests in private equity funds, which in turn invest in SME shares for the purpose of making investments in SMEs more accessible in the Netherlands. In doing so, DVI competes with MKB Multifunds. By offering selective advantages to DVI, the Ministry of Economic Affairs is distorting competition in MKB Multifunds’ opinion.
MKB Multifunds therefore filed a complaint with the Commission on the grounds of the provision of unlawful state aid by the Ministry of Economic Affairs to DVI. The Commission rejected that complaint because it found that DVI’s investments in private equity funds were in line with normal market conditions. DVI has therefore not been accorded any advantages within the meaning of Article 107 of the TFEU. MKB Multifunds appealed that decision before the General Court, arguing that DVI’s investments are not in line with market conditions. One of MKB Multifunds’ arguments is that the Commission did not perform an adequate investigation and that DVI’s underlying objectives are not purely economic. Unlike the Commission assumes, a private investor would not invest in the same manner as the Dutch government does through DVI, according to MKB Multifunds.
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