State Aid Modernisation after 3 years Conference on State aid Law Brno, 17 May 2017 Disclaimer: the views expressed are those of the speaker only and cannot be regarded as stating an official position of the European Commission Graça da Costa Senior Expert State aid strategy DG Competition

Index Introduction SAM: getting there SAM: first results SAM: Looking forward

Introduction 2012-2014 –major State aid reform –" SAM " . State aid control is the protection of the EU internal market against distortions created by Member States (Antitrust targets companies). State aid control  competition  growth. 2012-2014 –major State aid reform –" SAM " . Overall objective: contribute to Europe 2020 growth strategy. Concretely: Foster sustainable, smart and inclusive growth in a competitive internal market ("good aid”) Focusing COM ex ante scrutiny on cases with the biggest impact on internal market Strengthen MS cooperation for SA enforcement Streamline the rules, provide for faster decisions (cut red tape)

SAM: getting there Adoption of 10 guidelines based on common principles , 5 regulations and notices/communications to make State aid control instruments and procedures more efficient (GBER, NOA) Enlarged block exemption regulation brings more aid under control and responsibility of Member States = less aid to be notified to the Commission for approval Counterbalanced by new transparency and evaluation requirements and stronger scrutiny and monitoring by COM Bilateral and Multilateral Partnerships to proactively guide Member States in conceiving well-designed schemes.  

SAM: Objectives of common interest Promote broadband rollout in line with objectives of « Digital agenda for Europe» Develop investment in infrastructure Promote energy efficiency (market-based support for RES) /environmental protection beyond Union standards) Support R&D&I where there are « market failures » Facilitate access to finance by SMEs and « midcaps » Improve growth potential and competitivness for airports/airlines Support the develoment of disadvantaged regions Rescue and restructuring aid for undertakings in difficulty only under stricter conditions …

Enlarged GBER 2014 - 2020 New aid categories, increased notification thresholds, higher aid amounts enabling MS to disburse aid more quickly: Aid for broadband infrastructure Social aid for transport residents of remote regions Aid for culture and heritage conservation Aid for local infrastructures Aid for audio-visual works Aid for sport and multifunctional recreational infrastructures Aid to innovation clusters and aid to process and organisational innovation Research infrastructures Aid schemes to make good the damage caused by natural disasters Aid for process or organizational infrastructure

Stronger safeguard mechanisms Reinforced ex-post monitoring New transparency requirements for individual aid measures above EUR 500 000 New evaluation requirements for schemes of annual value above EUR 150 million Partnership (multilateral/bilateral) to ensure efficient controls at national level/ align SA policies with EU flagship initiatives

SAM – First results Changes in governance of EU State aid policy, including : Better allocation of resources Simplification = less administrative burden COM focusing scrutiny on most important cases Better cooperation More transparency Preparing the ground for designing better State aid measures (evaluation) Examples: support to audio-visual works (art. 54 GBER): 41 GBER schemes, few notifications/complaints Broadband: 31 cases where Commission decisions have been adopted (only one opening of the investigation) ; European Network of Broadband Competence Offices (BCO's), including State aid as a focal point RES electricity: effects of bidding process leading to significant savings

Scoreboard 2016 shows impact of modernisation GBER uptake (%) and number of of notifications At EU level, around 90% of aid measures are submitted under the new General Block Exemption Regulation (GBER) and so could be disbursed more quickly. GBER up-take from the Czech Republic is above EU average.

Scoreboard 2016 shows impact of modernisation Notified measures that are still subject to more careful scrutiny tend to cover bigger budgets and spending than in the past, in line with the Commission's approach to be 'big on big and small on small" things'

Scoreboard 2016 shows impact of modernisation Average duration of procedures is stable, despite increased focus on more complex cases

Scoreboard 2016 shows impact of modernisation Spending increasingly targets horizontal objectives of Community interest, such as, employment, environmental protection, R&D&I, risk capital and support to SMEs

GBER uptake - Most State aid fostering economic growth, jobs and other common interest objectives could therefore be directly implemented by Member States

Scoreboard 2016 shows impact of modernisation At EU level, about 46% of total spending was attributed to state aid to environmental and energy savings. In 15 Member States, most of the State aid spending was used for that purpose, to help them meet in particular their renewable energy targets

Scoreboard 2016 shows impact of modernisation Member States use State aid for very different policy objectives

Scoreboard 2016 shows impact of modernisation TRANSPARENCY New requirement to publish the name of the beneficiary and the amount of aid for each state aid award above €500,000 About 6000 aid awards have been already published by 21 Member States.

State aid evaluation 1 - Applies to selection of aid schemes (GBER >150 million annual budget + categories of notified schemes) - Evaluation plans approved by the Commission on the basis of common methodology - Evaluation reports at the end of schemes -> policy learning on direct and indirect impacts of aid - Until now: a) 13 Member States b) 35 aid schemes accounting for approx. EUR 40 bn in total annual budget c) majority of regional aid and R&D&I schemes 1 1 6 6 5 1 1 6 1 3 1 2

Multilateral and Bilateral partnerships MS have a considerable role in the SAM context: More responsibility in designing and implementing schemes (under GBER);Need to ensure efficient controls at national level SAM Implementation Working Group High Level Forum Multilateral Partnership Partnership Structured dialogue (3 MS) Taylor-made cooperation (9 MS) Case-driven cooperation (Czech Republic) "Bilateral Partnerships"

SAM: Looking forward Current phase: SAM implementation Targeted review of GBER: extension to ports and airports (imminent adoption) Next in the "SAM-horizon": evaluation Next on the SAM agenda: High Level Forum

Thank you! Graça da Costa Senior Expert State aid strategy DG Competition