Small and medium-sized enterprises in the EU and State aids provided for their support

Abstract

Provisions on the restriction of State aids form an important part of the primary and secondary EU competition law. The basic premise of the regulation is the circumstance that aid provided by States from public resources to enterprises can distort the competition within the EU and therefore is declared for incompatible with the EU internal market. At the same time we must realise that there are several situations in which a suitably scheduled State aids can act as a positive input to the development of the internal market and therefore a complete prohibition of State aids would be rather counter-productive. In several areas of the competition regulation rules and criteria for the admissibility of suitable State aids are formulated by the EU law. The rules for the admissibility of State aids for the support of small and medium-sized enterprises (SMEs) are one of these areas. The aim of the present article is to analyze the requirements for the provision of State aids to the SMEs as laid down by the SME block exemption of 2001 and, consequently, by the new GBER in force since 29 August 2008. Consequently the article analyses the impact of the State aids both on the supported SME and on the relevant market and/or the potential distortion of the completion it may cause. The analysis of the methodology for the assessment of aid for SMEs will be provided in order to define the categories of specific SME exemptions given by the EU Council regulation. Finally, the procedure for the approval of State aids to SME that fall outside the block exemptions, will be outlined. Comparative method will be used in order to evaluate the possible procedures available to the Member States.

Keywords

• state aid
• EU competition law
• small and medium-sized enterprises
• 2008 GBER