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Application of Articles 107 and 108 TFEU to certain categories of horizontal State aid
The Commission is empowered to adopt regulations establishing the compatibility of certain aid measures with the common market. These aid measures are exempt from the notification requirement of Article 108(3) of the Treaty on the Functioning of the European Union (TFEU).
Council Regulation (EC) No 994/98 of 7 May 1998 on the application of Articles 87 (former Article 92) and 88 (former Article 93) of the Treaty establishing the European Community to certain categories of horizontal State aid.
The Commission may, by means of regulations, declare that certain categories of aid are compatible with the common market and are not subject to the notification requirements of Article 108(3) of the Treaty on the Functioning of the European Union (TFEU) (ex-Article 88(3) of the Treaty establishing the European Community (TEC)). These categories include:
- aid for small and medium-sized enterprises, research and development, environmental protection, employment and training;
- aid that complies with the map approved by the Commission for each European Union (EU) country for the granting of regional aid.
The regulations must specify for each category of aid:
- the purpose of the aid;
- the categories of beneficiaries;
- thresholds expressed either in terms of aid intensities in relation to a set of eligible costs or in terms of maximum aid amounts;
- the conditions governing the cumulation of aid;
- monitoring conditions.
The regulations may also:
- set thresholds or other conditions for the notification of awards of individual aid;
- exclude certain sectors as regards the compatibility of aid exempted under such regulations.
The Commission may, by means of regulations, decide that, having regard to the development and functioning of the common market, certain types of aid do not meet all the criteria of Article 107(1) TFEU (ex-Article 87(1) TEC) and that they are therefore exempted from the notification procedure under Article 108(3) TFEU, provided that aid granted to one and the same undertaking over a given period of time does not exceed a specified fixed amount.
When adopting the regulations, the Commission will impose detailed rules upon EU countries to ensure transparency and monitoring of the aid exempted from the notification requirement. The rules will include the following requirements:
- EU countries must forward to the Commission summaries of the information regarding systems of aid or individual cases of aid not covered by the notification requirement as soon as they are implemented;
- they must record and compile all the information regarding the application of the block exemptions;
- they must supply the Commission once a year with a report on the application of block exemptions.
The regulations will apply for a specific period. They may be repealed or amended where circumstances have changed with respect to any important element that constituted grounds for their adoption or where the ongoing development or the functioning of the common market so requires.
Where the Commission intends to adopt a regulation, it must publish a draft thereof to enable all interested parties and organisations to submit their comments to it within a reasonable time limit.
Before publishing any draft regulation and before adopting any regulation, the Commission will consult the Advisory Committee on State Aid, which is composed of representatives of the EU countries and chaired by the representative of the Commission.
Every five years the Commission will submit to the European Parliament and to the Council a report on the application of Regulation (EC) No 994/98.
|Act||Entry into force||Deadline for transposition in the Member States||Official Journal|
|Regulation (EC) No 994/98||
OJ L 142 of 14.5.1998