STATE AID : CONSULTATION ON DRAFT GUIDANCE ON CONCEPT OF STATE AID.

In an effort to educate stakeholders, the European Commission wishes to clarify the concept of state aid. It opened a consultation, on 17 January, inviting comments on a draft notice "aimed at providing practical guidance for identifying state aid measures that need to be notified to the Commission for approval before being implemented, pursuant to Article 108(3) TFEU". The consultation will run until 14 March and the executive hopes to adopt its final communication during the second quarter of the year.

This clarification forms part of the far-reaching state aid modernisation sought by stakeholders, various aid-granting public authorities, potential beneficiary enterprises and judicial authorities ruling on disputes in this area. Determining when public subsidies constitute state aid and when they have to be notified to the European Commission is a crucial factor of implementation.

The 50-page text explains the different elements that constitute state aid as defined by the treaty (Article 107.1) and EU case law. For a measure to be considered state aid, there must be an economic activity from which the beneficiary draws an economic advantage and the measure must be imputable to the state, selective and have an effect on trade and competition. The draft guidance presents concrete examples in different sectors (social security, health, education) and reviews different types of aid (guarantees, tax breaks, grants). The concept of the 'market economy operator test' is also thoroughly detailed.

The draft is available at

State aidConsultation on draft guidance on concept of state aidBy Sophie MoscaIn an effort to educate stakeholders, the European Commission wishes to clarify the concept of state aid. It opened a consultation, on 17 January, inviting comments on a draft notice 'aimed at providing practical guidance for identifying state aid measures that need to be notified to the...

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