PURPOSE: to extend
Council Regulation (EU) 2015/1588 on the
application of Articles 107 and 108 of the Treaty on the
Functioning of the European Union to certain categories of
horizontal State aid.
PROPOSED ACT: Council Regulation.
ROLE OF THE EUROPEAN PARLIAMENT: the Council
adopts the act after consulting the European Parliament but without
being obliged to follow its opinion.
BACKGROUND: Council
Regulation (EU) 2015/1588 (the EU's State aid Enabling Regulation) on the
application of Articles 107 and 108 of the Treaty on the
Functioning of the European Union to certain categories of
horizontal State aid empowers the Commission to declare by means of
regulations that certain specified categories of aid are compatible
with the internal market and are exempted from the notification
requirement of Article 108(3) of the Treaty.
Centrally-managed EU funds, meaning funds under
direct or indirect Union management (to the exclusion of funds
under shared management with Member States), increasingly support
activities in the common EU interest through financial instruments
or budgetary guarantees, and thereby provide a particularly
valuable contribution to growth and cohesion.
The Commission should be enabled to declare
that, under certain conditions, aid granted by Member States, which
is channelled through or supported by such centrally-managed
financial instruments or budgetary guarantees, is compatible
with the internal market and not subject to the notification
requirement.
On 2 May 2018, the Commission presented its proposal
for the next multiannual financial framework (MFF). Building on
that, the Commission is proposing a number of horizontal and
sectorial EU funding programmes, responding to new challenges
whilst continuing successful established activities.
CONTENT: this proposal for an amendment of the
EU's State aid Enabling Regulation aims to improve the
interplay of those EU funding programmes with State aid rules.
It will enable the Commission to make targeted modifications
to current State aid rules so that national money - including from
the European Structural and Investment Fund managed at national
level - and EU funds managed centrally by the Commission can be
combined as seamlessly as possible, without distorting competition
in the EU's Single market.
More specifically, this proposal seeks to
extend the Enabling Regulation to include two new categories of
aid:
1. Member States’ financing
channelled through or supported by EU financial instruments or
budgetary guarantees managed centrally by the
Commission: the
importance of EU financial instruments and budgetary guarantees for
delivering support in a wide range of areas has increased over the
past years. It is set to increase even further under the post-2020
multiannual financial framework. The Commission's proposals for EU
financial instruments and budgetary guarantees managed centrally by
the Commission contain important safeguards to prevent undue
distortions of competition. Furthermore, they are typically less
distortive than grants of a similar amount, since they usually
involve smaller amounts of aid. It is therefore appropriate to
enable the Commission to block-exempt aid provided through
Member State financing, which is further channelled through or
supported by EU financial instruments or budgetary guarantees
managed centrally by the Commission, provided that certain
conditions are fulfilled.
In the Commission's experience, the alignment
of such aid with the conditions applicable to EU centrally-managed
financial instruments and budgetary guarantees, as implemented by
Union bodies, ensures that the aid provided by Member States does
not give rise to any significant distortions of competition
and that it is possible to define clear compatibility
conditions for this aid.
2. Aid for European Territorial
Cooperation: for
many years, promoting European Territorial Cooperation (ETC) has
been a major priority of EU cohesion policy. Support for SMEs for
costs incurred in ETC projects is already block-exempted under the
General Block Exemption Regulation (GBER). Special provisions for
regional aid for investments by undertakings of all sizes are also
included in the Guidelines on regional State aid for 2014-2020 and
in the regional aid section of the GBER. This means that the
Commission has gained significant experience in relation to aid
measures aimed at promoting ETC projects. It is therefore
appropriate to enable the Commission to block-exempt financing
provided in support of these projects.