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State aid
Get to grips with the rules covering State aid.
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State aid refers to forms of aid from a public or publicly-funded body to an economic undertaking on a selective basis, so that the aid:
- Can be seen as distorting or threatening to distort competition in the internal market; and
- May affect trade between member states of the European Union.
In the European Union, State aid is generally prohibited. State aid rules are in place to ensure that public aid is not used to give an enterprise from one country an unfair competitive advantage over other companies in other countries. However, State aid is allowed in closely-defined circumstances.
In the North Sea Programme, organisations can participate in projects in a way that that could potentially provide them with a competitive advantage. The inclusion of such organisations needs to be done in compliance with the State aid rules.
Please note the distinction between direct and indirect state aid:
Direct state aid refers to financial aid granted to organisations that are project partners in approved North Sea Programme projects.
Indirect state aid refers to aid granted to third party organisations that are not listed in the project application but that, through their participation in activities carried out by the project, receive an economic advantage compared to other identical organisations.
In the North Sea Programme, partnerships can include private partners and public sector partners active on a market, providing they increase the impact of the project.
The grant allocated to these project partners might qualify as state aid. In such cases of direct state aid, two options to manage state aid are available in the North Sea Programme.
The General Block Exemption Regulation (GBER) option: GBER entails a long list of different types of aid which serve a useful public function and which are thus allowed, provided that a number of conditions are met.
In the North Sea Programme, all project partners which can adhere to not receiving more than 80% funding for their activities in the project can make use of GBER.
In accordance with GBER, the ceiling for aid is €2 million per undertaking per project. The project partner has to provide a GBER self-declaration. Once GBER aid has been granted, all information pertaining to the GBER scheme is forwarded to the European Commission (or the EFTA Surveillance Authority in Norway) and made available to the public.
The de minimis option: De minimis is State aid granted to an undertaking but for such a small amount that it is deemed not to distort or threaten to distort competition. The maximum amount aid available may be up to €1,2 million per undertaking over a period of three fiscal years (€200,000 for Norwegian beneficiaries).
Before de minimis aid can be granted, the project partner has to provide a de minimis self-declaration; once de minimis aid has been granted, a formal notification to the undertaking and project will be issued. The programme records all information regarding the application of grants under the de minimis regime in the programme and shares them with the national authorities.
Third party organisations that are not listed in the project partnership but still get an economic benefit from the project may still fall under the state aid rules as so-called final recipients of aid. This is also called indirect state aid.
A final recipient is defined as an aid recipient that is not officially listed as a project partner in the project but which, through their participation in activities carried out by a project, receives an economic advantage compared to other identical organisations. This is the case when the activity in question is not open to and free for all relevant third-party organisations and does not target general knowledge and capacity development for these organisations. State aid to final recipients has to be placed under a state aid scheme.
The programme manages the risk of indirect State aid using Article 20a of the GBER.
Using Article 20a, the service provided to the organisation that is not a formal partner in the project may be funded in full without requiring the organisation to provide any contribution. In addition, Article 20a allows aid to be given to large enterprises. However, the total amount of aid granted under Article 20a GBER shall not exceed €20,000.