1. “State aid and EU funding – Are they compatible?”
Miriam Fernández Jutz Advisor to audit Director DG Regional and Urban Policy
CONT Hearing Brussels, 25 June 2018

2. Introduction
State aid rules apply to an increasing share of Cohesion Policy spending
State aid was reported as an important source of errors by ECA but improvements were noted
In 2014: 20% of the reported error rate related to State aid
In 2015: 5,8% or the reported error rate related to State aid
In 2016 no quantified errors with regards to State aid rules
Main reasons for errors reported by ECA:
Interpretation of the EU legislation until the Leipzig- Halle case
Lack of notification to the EC
No incentive effect
Aid intensity limits not respected

3. Actions at the EU level to target state aid errors in ESI Funds
State aid ex-ante conditionality for 2014 –2020 programmes fulfilled by all Member States except five at the start of implementation – now fulfilled by all MS
Adoption of a REGIO-COMP State aid action plan in 2015
Legislative simplification: GBER Regulation 2014
Clarifications to Member State by COMP through the "notice on the notion of State aid"

4. State aid action plan – guidance and strategic training
Training for Member State authorities
Practical guides for national authorities on scope of EU state aid control
Strategic sector oriented training programme
Pilot initiative "pool of State aid experts"
Need for identifying and disseminating good practices such as: - Central register for de minimis aid in CZ - Greece

5. Co-operation between DG COMP and DG REGIO
Checklists used by Commission auditors prepared with DG COMP support and shared with national auditors
Consult COMP on compliance of projects with Commission State aid decisions, GBER and in cases of major projects
Exchanges between DG COMP and DG REGIO to ensure qualitative outcomes (Memorandum of Understanding, inter-service consultations)
To coordinate as much as possible the monitoring/audit plans even if both procedures have different objectifs

6. Typology of errors
Source Annual control reports (expenditure 1/7/2016 to 30/6/2017)
Audit authorities audited operations or parts of operations
35 errors reported were related to State aid
Monitoring requirements
State aid not notified
Misapplication of the aid scheme
De Minimis threshold exceeded

7. Conclusions
State aid and Cohesion Policy funding are not only compatible but closely linked to ensure the functioning of the Single Market
But
Complexity for programme authorities
Schemes financed by Cohesion Policy are subject to significant number of checks (national, EC and ECA audits)
Distinct and complementary procedures REGIO/COMP
Therefore
Continue and intensify capacity building of programme authorities
Continue enhanced cooperation between various actors involved

8. THANK YOU FOR YOUR ATTENTION!