State aid law

The “de minimis” regulation is a key component of EU competition law that exempts small amounts of state aid that do not distort competition from the EU’s usual notification procedure. It aims to reduce the administrative burden for companies and the European Commission by simplifying the granting of financial support that falls below defined thresholds (generally EUR 300,000 gross within three years). These thresholds are measured over a certain period of time in order to determine which aid is considered “de minimis”.

The European Commission’s SGEI Decision provides an important relief in practice. The decision enables compensation to be granted to companies entrusted with the provision of SGEI without this aid having to be notified to the European Commission in advance. This always requires that the beneficiary company provides these SGEI and that this is done on the basis of a proper entrustment act. SGEI are deemed to exist if services are provided that would not have been provided by a private company in its own commercial interest, or would not have been provided under the same conditions or to the same extent. This is intended to cover cases of market failure in particular. In this respect, there is often an overlap with the area of municipal services of general interest. State aid law only formulates certain minimum requirements for the formally correct implementation of entrustment, but leaves the form of implementation of these requirements to the member states and therefore to national law.

The GBER is another important instrument of EU state aid law. It enables member states to grant certain categories of aid directly to specific recipients without the need for prior approval by the European Commission. This requires for the aid to fulfill certain conditions which are listed in detail in the GBER. The regulation covers various areas such as research and development, environmental protection, support for small and medium-sized enterprises, aid in the broadband sector, aid in the cultural sector, aid for sports infrastructure and multifunctional leisure infrastructure, etc. The GBER allows member states to respond flexibly to specific economic challenges while preserving the integrity of the internal market.

In exceptional times, such as the banking and financial crisis, the COVID-19 pandemic and the electricity and gas crisis resulting from the Ukraine conflict, the European Commission has always created special short-term framework conditions under state aid law, allowing the Member States to respond to the respective crisis and provide specific support to affected companies. These temporary regulations are aimed at stabilizing companies, securing jobs and maintaining economic structures. They demonstrate the flexibility of EU state aid law to respond to acute economic challenges without compromising long-term competitiveness and fair trade. Even in such crisis situations, many questions need to be examined and clarified in detail when applying the created regulations.