Think State Aid first!
It is crucial that public bodies fully consider the State Aid implications of a proposal at the earliest stage possible. This allows the measure to be designed or tweaked to fit within the State Aid Rules, and thus avoid potential serious problems later.
The European Commission can, and has, forced Member States to recoup any State Aid that has been given illegally. If the Commission takes a negative decision in the context of aid that has already been paid out, the Commission requires the Member State to recover the aid from the recipient, with interest.
DETE’S State Aid Unit provide advice to public authorities on the compliance of their programmes with the State Aid rules to ensure that the measure is compatible and legal.
To ensure there are no time delays we would ask that you contact the State Aid unit as soon as possible in this regard. We can provide an analysis of schemes to ensure State Aid is not present or provide you with alternative solutions should State Aid be identified.
What are the options if your proposal might involve State Aid?
- consider changing or adapting proposals to omit the element of State Aid
- design the proposal so that it fits within the terms of one of the already existing Irish State Aid schemes which the European Commission has approved
- design the scheme so that it fits within the De Minimis Regulation (EU) 2023/2831
- design the proposed aid to so that it fits one of the areas within the consolidated General Block Exemption Regulation (GBER)
- design the proposal so that it fits within the terms of other non-GBER guidelines, frameworks, notices and communications which the Commission uses when deciding whether proposed State aid may be compatible with the Treaty (this option requires you to obtain advance approval from the Commission)
In order to ensure compliance, Member States must notify the Commission of proposed State Aid in advance with the exception of those that fall within De Minimis, GBER or under pre-existing schemes. If none of the above conditions are satisfied, you will need to get specific advance approval from the Commission.
“De Minimis” aid
Small amounts of aid granted to one undertaking, that is, less than €300,000 in any rolling 3-year period, are considered to be so small as to have no appreciable effect on competition or trade and, under the De Minimis Regulation (EU) 2023/2831 rule, these are exempt from the general ban on State aid.
However, De Minimis payments to one undertaking under a number of measures or schemes have to cumulatively observe the €300,000 limit, and Member States are required to closely monitor de minimis payments to ensure that the limit is not breached.
Ireland like several other EU member states does not maintain a national register of De Minimis aid granted under Regulation 2023/2831. Each Irish Granting Authority keep records of De Minimis aid they grant, and these must be maintained for ten years, for supply to the Commission if requested.
Department of Agriculture, Food and the Marine maintains a register of agricultural De Minimis aid granted under Regulation no. 1408/2013 (specifically for primary agriculture purposes with a lower ceiling of €20,000 over three fiscal years).
When De Minimis aid is granted, the Granting Authority must explicitly inform the recipient of the amount and character of De Minimis aid, refer to the De Minimis Regulation No 2023/2831 and obtain from the enterprise a full declaration of any other De Minimis aid they have already received, over the previous three fiscal years. The Grantor may then grant new De Minimis aid once they are satisfied it will not result in the recipient breaching the €300,000 ceiling.
It is recommended that the below text be included in correspondence with applications for De Minimis aid:
The aid being sought is provided under the European Commission Regulation on De Minimis Aid. Small amounts of State aid, up to 300,000 Euros in any three-year period to any one enterprise, are regarded as too small to significantly affect trade or competition in the common market. Such amounts are regarded as falling outside the category of State aid that is banned by the EC Treaty and can be awarded without notification to or clearance by the European Commission. A Member State is required to have a mechanism to track such aid (called 'De Minimis aid') and to ensure that the combined amount of De Minimis aid payments from all sources to one enterprise in any three-year period respects the 300,000 Euro ceiling. Please provide details of all other De Minimis aid which has been granted to your company within the past three years. It should be noted that a false declaration by a company resulting in the threshold of 300,000 Euro being exceeded could later give rise to the aid being recovered with interest.
A declaration as follows should be signed by the applicant:
I wish to apply for [insert name of grant/aid sought] under the De Minimis Regulation (EU) 2023/2831 of 13 December 2023. I confirm that:
the company has been granted only the following de minimis aid within the past three years (details to be supplied)
Signed for Company: Date:
This does not mean that all funding under the €300,000 ceiling should be counted as De Minimis. In fact, in order to avoid the risk of the threshold being exceeded, it is generally more prudent to give the aid in the form under the General Block Exemption Regulation where possible. This has the advantage that the recipient undertaking is not ‘using up’ some or all of its De Minimis limit and may potentially be able to receive other De Minimis aid, from other sources.
De Minimis aid can be given for most purposes, including operating aid. However, De Minimis aid cannot be given for export related activities (except attendance at trade fairs), agriculture and fisheries or aid favouring domestic over imported products.
Separate De Minimis regulations apply for aid for agricultural activities. Please contact the Department of Agriculture, Food and the Marine for details.
If you intend to grant/avail of De Minimis aid please consult the De Minimis Regulation (EU) 2023/2831 surrounding conditionality to be adhered to.
General Block Exemption Regulation (GBER)
The GBER allows Member States to bring certain State aid schemes into place without prior notification to the EU Commission, provided that they are within the parameters set out in the GBER.
These include but are not limited to:
- Regional aid
- Aid to SMEs
- Aid for European Territorial Cooperation
- Aid for access to finance for SMEs
- Aid for research and development and innovation
- Training aid
- Aid for disadvantaged workers and for workers with disabilities
- Aid for environmental protection
- Aid to make good the damage caused by certain natural disasters
- Social aid for transport for residents of remote regions
- Aid for broadband infrastructures
- Aid for culture and heritage conservation
- Aid for sport and multifunctional recreational infrastructures
- Aid for local infrastructures
- Aid for regional airports
- Aid for ports
- Aid involved in financial products supported by the InvestEU Fund
You are required to send the Commission a summary information sheet about the aid measure via the State Aid Notification Interactive (SANI) system within 20 working days following the scheme coming into place. A copy of the information sheet may be found at Annex II of General Block Exemption Regulation.
The following steps should be followed:
- Contact email@example.com to get setup
- There are two types of users: encoding user, limited to entering data only, and a signatory, can enter data and sign and submit the form. Make sure you have both users within your department/unit
- Access the user guide within the SANI system
The SANI can also be used for prenotification and notification of a scheme that falls outside of the GBER/guidelines.
Departments are also obliged to publish the full text of each aid measure granted under the GBER, or a link providing access to the full text. Summary information on each aid measure exempted under the General Block Exemption Regulation is available in the Commission’s State Aid Register.
97% of Irelands State Aid comes under the GBER with the De minimis used for amounts under €300,000 over 3 fiscal years.
Specific Notification (not under GBER or De Minimis)
If a measure does not fit within the GBER, a pre-existing scheme or is not administered under De Minimis, it must be notified to the Commission via the SANI (please see steps above). This can be a lengthy process. More straightforward cases can be expected to be resolved within 6 to 9 months. More complex cases can be expected to take longer (thus the importance of availing of the GBER or a pre-existing Irish Scheme). Aid cannot be given until final approval has been received from the Commission.
Details of the various regulations can be found on State Aid legislation (europa.eu).
Notification process for non GBER Measures
- It can be useful at this stage to search the Commission’s search facility for similar authorised schemes from other Member States. You can then replicate the terms of that scheme as much as possible, in order to increase the chances of the Commission approving the proposal.
- Submitting a pre-notification (that is, a draft notification) to the Commission via the SANI.
- The pre-notification is then submitted via the State Aid Notification Interactive (SANI) to the Commission. SANI is administered in Ireland by this Division. Please contact us for set up details.
- In most cases, the Commission will respond with a request for further information and / or to arrange a discussion. There can be a series of rounds of questions and answers and refinement of the proposal until the Commission is satisfied that it can be approved. However, please note that there is no guarantee that the Commission will give State Aid approval to the proposal.
- The Commission will then invite the Member State to submit the final notification via SANI, and final approval should normally be given within a further two months.
If you are planning on notifying a non GBER scheme please contact the State Aid Unit.
Services of General Economic Interest (SGEI)
In general, Services of General Economic Interest (SGEI) are services that the market does not provide or does not provide to the extent or at the quality that the State desires and are in the general (that is, of all citizens) interest and not the interest of a particular sector. For certain SGEI’s to operate, financial support from the public authorities may prove necessary. If so, State Aid issues may arise.
SGEI's tend to include such areas such as healthcare provision, social housing, provision of gas, electricity and telecoms, public service broadcasting and public transport, but this is not an exhaustive list. One example is State Aid SA.41702 (2016/NN) – Ireland Risk Equalisation Scheme. This is an SGEI.
There are specific State Aid provisions for SGEI.