The European Commission has for the first time approved state aid evaluation plans for two different aid schemes in the Czech Republic and the United Kingdom. It will enable both countries to provide aid of more than €6 billion in total to spur investment and development. The aid schemes can now run until 2020 without requiring further Commission approval. This was made possible by the new General Block Exemption Regulation (GBER), which as part of the Commission's State Aid Modernisation (SAM) Initiative, greatly extended the scope of aid exempted from prior notification to the Commission.
Commissioner in charge of competition policy, Margrethe Vestager, said at the High Level State Aid Forum with Member States today, "Evaluating the impact of large state aid schemes will provide part of the groundwork for designing better state aid measures. We need to promote good aid, stamp out bad aid and ensure transparency of where the money goes and what its impact is." Please see the Commissioner's full speech here.
Evidence collected for the 2014 State aid scoreboard shows that a growing percentage (now over 80%) of compatible aid measures are going through the GBER, and can therefore be implemented by Member States immediately, without having to seek prior approval by the Commission. At the same time, the tailor-made evaluation plans for large aid schemes ensure that taxpayer money is well spent on smart aid measures, which contribute to economic growth and do not harm fair competition.
There is no cause for complacency. As Commissioner Vestager said: "Changing the state aid rules is only half the battle. One of the key challenges of my mandate will be to see that State Aid Modernisation is implemented in practice." Today, the Commissioner proposed a new approach on how the Commission and Member States can work better together: They should cooperate to ensure that greater flexibility for Member States to implement aid is balanced by better cooperation, diligent national controls and more transparency:
- The Commission will work with Member States on how to select and design aid for infrastructure projects with the greatest impact on growth. A working group on State Aid and infrastructure projects will be set up to share best practice on designing such projects.
- Member States are invited to present proposals for strengthening national systems to ensure better State aid compliance, not only through formal checks but also through pro-active assessment of national measures in fields such as tax and on sectors in need of restructuring.
- Member States are invited to work with the Commission on a roadmapto improve transparency to inform citizens where their money has gone. If greater transparency makes it possible, the Commission would also consider further reductions in reporting obligations.
Background on State aid evaluation
According to the GBER, aid schemes with an annual budget of more than €150 million are initially exempted for six months. To be prolonged, Member States must submit evaluation plans taking into account the specifics of the individual schemes and in line with clear principles (e.g. on planning, data collection, evaluation methodologies, evaluator and involvement of stakeholders). If they fail to do so, they have to notify the scheme for a state aid assessment by the Commission after expiry of the six-month period. Results of the evaluations will help design better future schemes. Please see the Frequently Asked Questions for further information on State aid evaluation.
The Commission assessed the evaluation plans according to principles published in the Staff Working Document on State Aid Evaluation. An introduction to State aid evaluation is available in a dedicated Competition Policy brief.
More details on the evaluation plan for the EUR 2.8 billion Czech "Investment Incentives" and UK ''Regional Growth Fund'' aid scheme (with a preliminary budget of at least GBP 3.2 billion) can be found on the websites of the Czech authorities and the UK authorities. The final evaluation reports for both schemes have to be submitted to the Commission by 30 June 2020.
The non-confidential version of the decisions will be made available under case numbers SA.38751 for the Czech scheme and SA.39273 for the UK scheme in the State Aid Register on the competition website once any confidentiality issues have been resolved. New publications of state aid decisions on the internet and in the Official Journal are listed in the State Aid Weekly e-News.