Having regard to the Agreement on the European Economic Area (‘the EEA Agreement’), and in particular Articles 61 to 63 and Protocol 26,

Having regard to the Agreement between the EFTA States on the Establishment of a Surveillance Authority and a Court of Justice (‘the Surveillance and Court Agreement’), and in particular Article 24 and Article 5(2)(b), and

Having regard to Protocol 3 to the Surveillance and Court Agreement (‘Protocol 3’), and in particular Article 1(1) of Part I.

Under Article 24 of the Surveillance and Court Agreement, ESA shall give effect to the provisions of the EEA Agreement concerning State aid.

Under Article 5(2)(b) of the Surveillance and Court Agreement, ESA shall issue notices or guidelines on matters dealt with in the EEA Agreement, if that Agreement or the Surveillance and Court Agreement expressly so provides or if ESA considers it necessary.

The following State aid guidelines adopted by ESA, as part of the State aid Modernisation initiative, are due to expire at the end of 2020:

In the context of the Green Deal and Digital Agenda, the European Commission (‘the Commission’) has already announced its intention to revise a series of guidelines by the end of 2021.

On 2 July 2020, the Commission adopted a Communication concerning the prolongation and the amendments of the Guidelines on Regional State aid for 2014-2020, Guidelines on State aid to Promote Risk Finance Investments, Guidelines on State aid for Environmental Protection and Energy 2014-2020, Guidelines on State aid for rescuing and restructuring non-financial undertakings in difficulty, Communication on the Criteria for the Analysis of the Compatibility with the Internal Market of State aid to Promote the Execution of Important Projects of Common European Interest, Communication from the Commission – Framework for State aid for research and development and innovation and Communication from the Commission to the Member States on the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union to short-term export-credit insurance (7).

To provide predictability and legal certainty, while preparing for a future update of the State aid rules, the Commission considered it appropriate to extend the period of application of its guidelines, corresponding to the ESA guidelines listed in points (a)-(e) above, until the end of 2021. The Commission extended the period of application of the guidelines corresponding to those listed in point (f), the Guidelines on State aid for rescuing and restructuring non-financial undertakings in difficulty, until the end of 2023.

The prolongation of those rules will allow the Commission to finalise the evaluation of those rules together with other State aid rules adopted as part of the State aid Modernisation initiative. On 7 January 2019, the Commission launched the evaluation of those rules in the form of a ‘fitness check’. On the basis of the result of that evaluation, the Commission will then be in a position to decide whether to further prolong or update those rules.

Having regard to the economic and financial consequences that the COVID-19 outbreak may have on undertakings, the Commission considered that temporary adaptations of some State aid Guidelines are also necessary. In particular, in the framework of the Guidelines on regional State aid for 2014-2020, the Guidelines on State aid for environmental protection and energy 2014-2020, the Communication – Criteria for the analysis of the compatibility with the internal market of State aid to promote the execution of important projects of common European interest (IPCEI) and the Framework for State aid for research and development and innovation (8), undertakings which were not in difficulty on 31 December 2019, but became undertakings in difficulty after 31 December 2019 should be eligible under those guidelines until 30 June 2021.

With regard to the Guidelines on State aid for environmental protection and energy 2014-2020, the sharp decline of electricity prices due to the COVID-19 outbreak could lead to situations where the electro-intensity of undertakings may decrease. In that case, the undertaking may lose eligibility under Section 3.7.2 (targeted reductions in the funding of support for energy from renewable sources for competitiveness reasons) when applying Annex 4 for calculating the GVA (Gross Value Added) and the electro-intensity at the level of the undertaking. The Commission therefore considered that calculation methods to be used should therefore be adapted, in order to address this in an appropriate manner.

These amendments and prolongations to the Commission’s Communications are also of relevance to the European Economic Area.

Uniform application of the EEA State aid rules is to be ensured throughout the European Economic Area, in line with the objective of homogeneity established in Article 1 of the EEA Agreement.

According to point II under the heading ‘GENERAL’ on page 11 of Annex XV to the EEA Agreement, ESA, after consultation with the Commission, is to adopt acts corresponding to those adopted by the Commission,

Having consulted the Commission,

Having consulted the EEA EFTA States,

Article 1

The substantive rules in the field of State aid shall be amended as follows:

Article 2

Only the English language version of this Decision is authentic.