ROADMAP

Roadmaps aim to inform citizens and stakeholders about the Commission's work in order to allow them to provide feedback and to participate effectively in future consultation activities. Citizens and stakeholders are in particular invited to provide views on the Commission's understanding of the problem and possible solutions and to make available any relevant information that they may have.

Title of the initiative

Review of Regional Aid Guidelines

Lead DG – responsible unit

DG COMP / UNIT H1

Likely Type of initiative

Commission autonomous act – Commission Regulation

Indicative Planning

End date: Q1 2021

Additional Information

https://ec.europa.eu/competition/state_aid/regional_aid/regional_aid.html

A. Context, Problem definition and Subsidiarity Check

Context

The current guidelines for regional state aid set out the conditions under which regional aid may be considered compatible with the internal market and establish the criteria for identifying the areas that fulfil the conditions of Article 107(3)(a) and (c) of the Treaty on the Functioning of the European Union (TFEU). As the guidelines for 2014-2020 will expire, the Commission, with this initiative, is launching their review process.

The regional aid guidelines will be revised based on the preliminary results of the Fitness Check performed by the Commission in 2019/2020 on the existing State aid frameworks.

The regional aid guidelines are planned to be reviewed by the end of 2021 to support the new priorities, such as the European Green Deal, the Industrial and Digital Strategy.

Problem the initiative aims to tackle

This initiative concerns an update of the regional aid guidelines 2014-2020, which include the criteria to establish the regional aid maps and which limit the validity of those maps until end 2020. A limited prolongation of the guidelines and the corresponding maps until 31 December 2021 has been announced (see the separate initiative and press release), meaning that new regional aid guidelines need to be adopted for the period thereafter. All Member States are affected by this initiative. Each Member State will also have to notify a new regional aid map.

The update of the guidelines will be based on the preliminary results of the Fitness Check, which show that the current provisions work well but require some adjustments:

(1)A general simplification of the structure and clarification of the definitions and terminology by aligning them to the General Block Exemption Regulation (GBER). In addition, there is an update on the sections of evaluation and transparency to allow consistency across State aid rules.

(2)An update of sector exclusions. 

(3)Regional aid coverage, a-areas and predefined c-areas are updated based on the current methodology and most recent statistics on GDP and unemployment, which is in line with the procedure in the last period. The regional aid maps will be valid for the period 2022-2027 with a mid-term review scheduled for 2024.

(4)According to the results of the evaluation, the current provisions on State aid for investments related to new products and new process innovations induce a heavy administrative burden. Since in the full period, only one such case was approved, those provisions were removed.

(5)The maximum aid intensities have been increased to support the European Green Deal and Digital Strategy objectives by enabling additional incentives for private investments.

(6)The five criteria of paragraph 168 of the current RAG have been maintained with a slight simplification for Just Transition Areas.

Basis for EU intervention (legal basis and subsidiarity check)

Articles 107 and 108 TFEU. The Commission has exclusive competence to decide on the compatibility of State aid with the internal market.

The rules issued by the Commission laying down the compatibility conditions of aid measures aim to ensure predictability and legal certainty for Member States and stakeholders on how the Commission interprets the State aid provisions in the Treaty.

B. What does the initiative aim to achieve and how

In 2012, the Commission launched a major reform of EU State aid rules (SAM) with the objectives to 1) to foster sustainable, smart and inclusive growth in a competitive internal market; 2) to focus Commission's ex ante scrutiny on cases with the biggest impact on the internal market; and 3) to streamline the rules and provide for faster decisions. In this context, the regional aid guidelines were also updated.

This initiative aims to review the guidelines based on the results of the Fitness Check. Furthermore, the guidelines will take into account the new Commission priorities that were announced for the period 2019-2024, in particular the objectives of the European Green Deal, by providing a framework for targeted regional aid to mitigate the social and economic consequences in disadvantaged regions.

The regional aid guidelines are planned to be reviewed by early 2021 to allow time for the new regional aid maps to be approved on the basis of those guidelines. The Commission will then apply the principles set out in those guidelines for assessing the compatibility of non-block exempted regional aid intended to be awarded after 31 December 2021, to support the new priorities, such as the European Green Deal, and the Industrial and Digital Strategy.

As a result, the regional aid guidelines will continue to maintain the objectives of regional development and cohesion that are enshrined in Articles 107 (3)(a) and (c) of the TFEU and provide continued targeted support to disadvantaged regions in the EU.

C. Better regulation

Consultation of citizens and stakeholders

The updated regional aid guidelines will be a result of the evaluation and a broad consultation process aimed at gathering views from a wide range of EU stakeholders. The following activities are planned during the revision of the guidelines:

·A public consultation on the draft guidelines that will be available via the DG Competition website in all official EU languages. It will be addressed to all stakeholders that have an interest in regional aid and allow interested parties to provide feedback to the draft guidelines in all official EU languages. This will ensure transparency and accountability. The consultation on the draft guidelines is planned to be launched in Q3 2020.

·A consultation of EU Member States on the draft guidelines during a multilateral meeting.

·Further to the above, stakeholders are also invited to provide feedback to this roadmap.  

Evidence base and data collection

The initiative is based on the evidence and data collected during the ex-post evaluation of the regional aid framework (in the context of the Fitness Check) in combination with the Commission’s experience stemming from case practice.

The changes on the guidelines will be based on the evaluation in the context of the Fitness Check, taking into account the new Commission priorities (in particular the Green Deal and the Industrial and Digital Strategy) and the economic impact of COVID-19. As the fitness check will provide all the relevant information for these limited adjustments, an impact assessment is not needed.