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Local public support measures fall outside EU state aid control

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Local public support measures fall outside EU state aid control

Margrethe Vestager - Photo EU Council

(BRUSSELS) - When it comes to purely local operations of public support measures, EU Member States always have full autonomy to decide and invest state funds, the EU Commission said on Wednesday.

Five state-funded local measures in Spain, Germany and Portugal involve no state aid because they are unlikely to affect trade between Member States, the EU executive made clear.

The decisions clarify what public support measures Member State authorities can implement without prior scrutiny by the Commission.

They complement a set of decisions taken in 2015 that gave prior guidance on what types of public support does not constitute State aid. The Commission says that this reduces the administrative burden for EU Member States, speeds up the delivery of investments, and increases legal certainty for public authorities and companies.

"In many cases Member States can stimulate investment without asking the Commission", said Competition Commissioner Margrethe Vestager. "These decisions confirm that many local public support measures do not constitute state aid."

The decisions are part of the EU efforts to focus State aid control on bigger cases that genuinely impact competition in the Single Market, and complement several initiatives the Commission has taken over the past two years.

The general principle of EU state aid rules is that they ensure that all companies can compete on an equal footing across the EU's Single Market. Public support to individual companies is seen as distorting the level playing field.

However, where the beneficiary of state support supplies goods or services to a limited area within a Member State, and is unlikely to attract customers from other Member States, the Commission says there may be no effect on intra-EU trade and therefore no state aid within the meaning of the EU rules. To be free of aid, the measure should also have no - or at most marginal – foreseeable effects on cross-border investment in the sector or on the establishment of companies within the EU's Single Market.

The decisions include Spanish plans to grant public funding to micro-companies in the media sector to promote the Basque language; the construction of several sports facilities at the Sportcamp Nordbayern in Bavaria; plans to support the renovation and modernisation of infrastructure in a small German island; social support services to the elderly and disabled and other long-term care services in Portugal; .and Spanish plans to support written or digital media in Valencian, with the aim of promoting the use of the Valencian language.

 


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