Transcript regions
Revision of the regional aid guidelines (RAG) DG Competition June 2004 DG Competition 1 Main policy objectives Concentration of regional aid to investment in the least favoured regions Increased flexibility for Member States and regions to pursue local regional policy Enhancing the long-term competitiveness and growth potential of all European regions DG Competition 2 Current rules Basic principle: exceptional nature of regional aid DG Competition 3 Overall coverage of 42.7% of Community population Criteria for allocating the Community ceiling between Member States Criteria for selection of Article 87(3)(a) and Article 87(3)(c) regions The context of the revision The current maps expire on 31.12.2006 DG COMP has made use of DG Competition 4 Conclusions of European Councils Comments submitted by Member States Experience with the present RAG, aid maps and aid schemes Literature (surveys, studies and academic papers) on the economics and effectiveness of regional aid The Third Cohesion report Conclusions of European Councils The Lisbon, Gothenburg, Stockholm and Barcelona European Councils: less and better-targeted State aid Questions DG Competition 5 Is the award of aid for initial investment and linked job creation really the most effective way of promoting cohesion? Can the aid levels allowed under the present guidelines be reduced without decreasing the effectiveness of such aid? The Third Cohesion report Three main objectives: convergence, regional competitiveness and employment, and European territorial co-operation Convergence will be promoted by supporting growth and job creation in the least developed Member States and regions Regional competitiveness and employment will be promoted by supporting a limited number of domains of intervention: innovation and the knowledge economy, environment and risk prevention, accessibility and services of general economic interest The choice of a thematic approach rather than one based on selected geographic areas (mapbased approach) allows for coherence between regional and competition policies DG Competition 6 A new approach to regional policy Shifting from subsidies that temporarily compensate for regional disadvantages to the provision of public goods and incentives permanently increasing the potential of regions to growth Regional investment aid to the poorest regions Operating aid in limited cases (outermost regions and low population density areas) Phasing out of regions that lose eligibility to Article 87(3)(a) Horizontal thematic approach for the rest of the territory DG Competition 7 Areas eligible for Article 87(3)(a) NUTS II regions with GDP/cap below 75% of the EU-25 average GDP below 50%: 50% gross for large companies GDP below 60%: 40% gross for large companies GDP below 75%: 30% gross for large companies Operating aid in limited cases DG Competition 8 handicaps of outermost regions additional transport cost in low population density areas Earmarked Article 87(3)(c) regions Regions losing Article 87(3)(a) status because of the statistical effect of enlargement Regions losing Article 87(3)(a) status due to economic reasons Other outermost regions Other low population density areas DG Competition 9 Population coverage Total (provisional) coverage: 34.84% of Community population DG Competition 10 Abnormally low standard of living: 27.11% Statistical effect regions: 4.18% Economic growth regions: 2.71% Other outermost regions: 0.43% Other low population density areas: 0.41% Any other regions Thematic approach in State aid DG Competition 11 Horizontal rules, many of which will be reviewed before 1.1.2007 New approach for the assessment of lesser amounts of State aid and of certain aids with limited effects on trade (significant impact test) Increased flexibility for Member States to tackle local problems and to differentiate between regions where this is considered to be necessary Existing horizontal instruments SMEs: aid for investment, advisory services and participation in trade fairs R&D: aid for basic and applied research projects Environment: aid for environmental investment (incl. energy saving, renewables, polluted sites, relocation), and operating aid for recycling and renewables Training: aid for general and specific training of employees Employment: aid for net job creation and for employment of disadvantaged and handicapped people Rescue and restructuring: rescue aid (liquidity injection for 6 months) and restructuring aid Risk capital: aid for risk capital funds de minimis: small amounts of aid for anything DG Competition 12 The significant impact test Aid with limited spillovers (small distortions of competition and limited effect on trade) to be considered compatible with the common market DG Competition 13 Based on economic rationale Involving clear and easy criteria that require minimal or no assessment Leading to a reduction in workload Being transparent Services of general economic interest Financial support which merely represents compensation for public service obligations imposed by the member states does not have the characteristics of State aid (Altmark ruling) DG Competition 14 Definition of public service obligations Compensation calculated in an objective and transparent manner Compensation cannot exceed what is necessary to cover all or part of the costs incurred Undertaking is chosen via public procurement, or the level of compensation is determined by comparison with the costs which a typical undertaking would incur Other issues for the revision of the regional aid guidelines Multisectoral Framework will become part of the regional aid guidelines Possible block exemption for regional aid Further differentiation between small and medium-sized enterprises Consistency with Structural Funds Net or gross grant equivalents DG Competition 15 Proposed aid intensities Large Medium Small 87(3)(a) ≤ 50% GDP 50% 60% 70% 87(3)(a) ≤ 60% GDP 40% 50% 60% 87(3)(a) ≤ 75% GDP 30% 40% 50% 87(3)(c) ‘statistical effect’ regions 30%→20% 40%→30% 50%→40% Other 87(3)(c) earmarked regions 20% 30% 40% Non-assisted areas - 10% 20% DG Competition 16 Specific provisions for outermost regions All outermost regions are entitled to a bonus of 10% in aid intensities, which will place them in a “higher” category Outermost regions eligible to Article 87(3)(c) are treated as “statistical effect” regions, with maximum aid intensities gradually decreasing from 40% to 30% in the course of the period covered by the aid map DG Competition 17