This question & answer briefing outlines the main possibilities given to European Union Member States by EU state aid rules to support various parts of the economy.
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Member States can always rely on the possibilities offered by the Regulation () and give aid of up to 200 000 per company, independently of its size, i.e. irrespective of whether it is an SME or a large company, for a period of three years. If the conditions of this regulation are met, such support does not constitute State aid and therefore Member States are free to award it without entering into any administrative procedure, i.e. without having to notify it to the Commission.
No. The General Block Exemption Regulation (), which was adopted in July 2008, exempts from notification several support measures in favour of SMEs, social aid, regional aid and environmental aid, R&D and Innovation aid, training aid and aid for enterprises created by female entrepreneurs. As long as Member States respect the conditions laid down in this Regulation, they can support companies in these different ways without having to notify them to the Commission.
The Regulation (see IP/06/1765) also allows Member States to provide subsidies of up to 200 000 per company for a period of 3 years, without any notification obligation to the Commission.
Member States have the possibility to provide guarantees to companies for loans in which the guaranteed part does not exceed 1 500 000 without calculation of the aid linked to this guarantee. If the guarantee respects the conditions laid down by the Regulation, it is considered that the amount of aid does not exceed 200 000 and consequently constitutes aid which can be implemented without delay.
For guarantees exceeding 1 500 000, Member States can still facilitate the access to finance for SMEs as well as large companies without having to notify their measures to the Commission, as long as they calculate the remuneration of such guarantees in compliance with the conditions laid down in the Notice on state aid in the form of guarantees.
Member States can provide funding to SMEs in their early stages of development (seed, start up and expansion) along with private investors up to an amount of 1.5 million per target SME over any period of one year, without having any supplementary administrative burden. In case Member States provide such funding in conformity with the conditions laid down in the General Block Exemption Regulation of July 2008, the aid in question is considered compatible and is exempted from the notification process.
In case Member States decide to provide funding exceeding the 1.5 million threshold, such aid can still be declared compatible by the Commission after notification, if it complies with the conditions laid down in the 2006 Risk Capital Guidelines ().
The new General Block Exemption Regulation (GBER) allows different types of aid to SMEs:
- aid up to 1 million or even 2 million depending on the assisted region concerned, for newly created small enterprises
- SME investment and employment aid
- aid up to 1 million for enterprises newly created by female entrepreneurs
- aid for early adaptation to future Community standards in the field of environmental protection
- aid for consultancy and participation in fairs
- aid up to 1.5 million over a period of one year in the form of risk capital
- aid for industrial property rights costs
- aid up to 1 million for young innovative companies going up to 1;5 million depending on the assisted regions concerned
- aid up to 200 000 for innovation advisory services and innovation support services
- aid up to 50% of the eligible costs for loan of highly qualified personnel.
Apart from these measures which are specifically designed for SMEs, the GBER provides for the following measures which concern all companies, including SMEs:
- aid for research and development; up to 20 million for fundamental research, up to 10 million for industrial research and up to 7.5 million for other research and development projects or feasibility studies
- training aid
- aid for the recruitment of disadvantaged workers
- aid for the employment of disabled workers as well as for the compensation for additional costs of employing disabled workers.
For innovative small enterprises that has been in existence for less than 6 years, Member States can grant State aid up to 1 million, or even up to 1.5 million in assisted regions.
Yes. Member States can award different types of aid to SMEs as long as they concern different activities (“different eligible costs”), without having to pass through the usual notification procedure. For instance, one and the same SME can receive at the same time aid for a training project (training aid), for buying a machine (investment aid) and for participating in fairs.
Without notification, an SME can receive at the same time investment aid, regional aid and environmental investment aid, as long as these amounts of aid are cumulated up to the maximum amount foreseen in the GBER.
Yes, on the basis of existing rules, Member States can grant:
- up to 1 million aid (or even more in assisted regions) for young innovative enterprises
- aid for innovation advisory services and for innovation support services (200 000 per beneficiary)
- aid for process and organisational innovation in services
- aid for innovation clusters.
Member States have the possibility to grant subsidies of up to 1 million to small enterprises newly created by female entrepreneurs without having to pass through the notification process, as long as they comply with the conditions laid down in the GBER.
Member States can grant general as well as specific training aid to companies when such aid has an incentive effect (i.e. gives rise to training that the company would not undertake in the absence of the aid). Specific training is directly and principally applicable to the employee and provides qualifications which most of the times are not transferable to other undertakings of fields of work, while general training provides qualifications which are largely transferable to other undertakings or fields of work. Bigger aid intensities are allowed for general training, as it is less distortive for competition than specific training. The basic aid intensities are 25% for specific training and 60% for general training, but these intensities can be increased in particular for SMEs.
Member States can finance a series of measures in relation to environmental protection without having to notify to the Commission, as long as they comply with the conditions laid down in the General Block Exemption Regulation. Under the GBER they can grant:
- investment aid enabling companies to go beyond Community standards for environmental protection or increase the level of environmental protection in the absence of Community standards
- aid for the acquisition of new transport vehicles which go beyond Community standards or which increase the level of environmental protection in the absence of Community standards
- aid for early adaptation to future Community standards for SMEs
- investment aid for energy saving measures
- investment aid for high efficiency cogeneration
- investment aid for the promotion of energy from renewable energy sources
- aid for environmental studies
- aid in the form of reductions in environmental taxes.
All these aid measures of an amount up to 7.5 million can be adopted by Member States without notification, as long as they comply with the conditions laid down in the GBER.
The new Guidelines on state aid for environmental protection provide also a large series of measures which Member States can adopt in order to promote environmental protection in compliance with state aid rules:
- all aid measures indicated above which exceed the ceilings laid down in the GBER;
- aid for energy-efficient district heating
- aid for waste management
- aid for the remediation of contaminated sites
- aid for the relocation of undertakings
- aid involved in tradable permit schemes.
Member State authorities at central, regional and local level can give aid to companies. In case an aid measure has to be notified according to the conditions laid down in the specific aid instruments, the notification is done by the Member State and the Commission’s role is to ensure that the proposed aid is compatible with existing rules.
Annex I of the General Block Exemption Regulation provides the definitions of micro, small and medium sized enterprises. According to this Annex:
A micro-enterprise is an enterprise that has fewer than 10 employees and has neither an annual turnover nor a balance-sheet total exceeding 2 million.
A small enterprise is an enterprise that has fewer than 50 employees and has neither an annual turnover nor a balance-sheet total exceeding 10 million.
A medium-sized enterprise is an enterprise that has fewer than 250 employees and has neither an annual turnover exceeding 50 million nor a balance-sheet total exceeding 43 million.
SMEs can keep the possibility of receiving state aid as SMEs for a transitional period of two years after having crossed the thresholds cited above.
