Assessing the effectiveness of different approaches to transparency

• Author: Michie, Rona; Wishlade, Fiona; Mendez, Carlos
• Pages: 13-29

Fact-finding studyon the GBERtransparency re quirement

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3.ASSESSING THE EFFECTIVENESS OF DIFFERENT APPROACHES TO TRANSPARENCY

This section explores the available data on compliance with the transparency requirements and

considers to what extent apparent differences in levels of compliance can be attributed to

different transparency systems.

This section is in three parts. It begins with an assessment of the available data, looking at how,

and how far, it can be used to measure compliance. Second, it provides an overview of patterns of

reporting delays. Last, it seeks to explainthose delays, exploring the role of transparency systems

and other pertinent criteria.

3.1.COMPLIANCE DATA

3.1.1.Background

The starting point for the analysis was the data underpinning the 2019 Compliance Report.6The

compliance report considers two dimensions:

1.Whether or not awards over the €500,000threshold were reported. This assessment links

information reported through SANI2/ISIS, TAM and annual repor ting for the State aid

scoreboard (SARI). This is analysed in 'Checks Update'.7

2.Whether the deadline for reporting was respected. Delays occur at the level of individual

awards and are tracked and assessed in 'Quality Update'.8

(i)Compliance in Reporting Aid Awards - Checks Update

This analysisoperated at the level of the aid measure.It made use of three linked datasets:

•the budget and expectednumber of recipients reported in SANI2/ISIS;

•reporting of awards exceeding €500,000 through TAM; and

•annual expenditure reporting through SARI for the Scoreboard.

Note that SARI requires the amountpaid, but not the number of recipients. Clearly these three

datasets provide different perspectives on anticipated or actual spend, but nevertheless enable

some insights into when TAM reporting is likely to have been required.

The anticipated average amount spent per beneficiary can be calculated by combining

information from both SANI2/ISIS and SARI. If this exceeded€500,000, then some reporting

through TAM would be expected; if this was absent then the Commission sought clarification

from the MemberState. If the average award wasless than €500,000, but the amount reported in

TAM less than 25 percent of the amount reported in SARI, then clarification was alsosought from

the Member State.

6Results 2019 Compliance Checks exercise – Transpare ncy (Internal Report, Unit A3 DG COMP).

7Final results - 2019 compliance checks_update 01022020 (Excel) – measure-based data.

8Final results - 2019 compliance checks – quality update 01022020 (Excel) – award-based data.

In practice, however, Member States typicallydo not report the anticipated number of

beneficiaries in SARI(see Figure 4), so for the vast majority of measures, average awards cannot

be estimated. In these cases, the Commission also sought clarification from the Member State.

Figure 4: Availability of data on estimated number of beneficiaries per scheme

Measures

Number

Number of measures assessed in Checks Update

2401

Of which, aid schemes (not ad hoc/ individual awards)

2005

Of which measures providing estimated number of beneficiaries

148

Source: EPRC calculations from DG COMP Final result s - 2019 compliance checks_update 01022020.

The clarification process undertaken with the Member States in spring/summer 2019 resulted in

the measures examined receiving a ‘final classification’ as follows:

•Direct compliance issues

•No compliance issues

•Not under the Transparency9

The outcomes are summarised in Figure 5 and suggest that compliance issues arose in 329 of the

measures analysed (13.7 percent of the total) and that expenditure associated with these

measures (not all of which would necessarily be implicated in the transparency requirement – i.e.

some of the awards made would not meetthe reporting threshold) amounted to some €47.425

billion (26.9 percent of the total under the measures assessed).

Figure 5: Compliance issues – final classification

Compliance / Measure Type

Number of

measures%

Amount

spent€m%

Direct Compliance Issues

329

13.7

47,425

26.9

Ad hoc/ individual aid

55

2.3

451

0.3

Aid schemes

274

11.4

46,974

26.6

No Compliance Issues

1643

68.4

113,185

64.2

Ad hoc/ individual aid

299

12.5

8,945

5.1

Aid schemes

1344

56.0

104,240

59.1

Not under the Transparency

429

17.9

15,759

8.9

Ad hoc/ individual aid

42

1.7

3,732

2.1

Aid schemes

387

16.1

12,027

6.8

Total

2401

100.0

176,369

100.0

Source: EPRC calculations from DG COMP Final result s - 2019 compliance checks_update 01022020.

9Some measures that may have made awards exceeding €500,000 since 1 July 2016 are not subject to the transparency

requirement– because in the past this was not imposed in Comm ission decisions on notified measures (this is now

imposed consistently).