State aid is an instrument of European policy which is laid down in the founding Treaties of the European Communities. The objective of State aid control is to ensure that government interventions do not distort competition and intra community trade. State aid is defined as an advantage in any form whatsoever conferred on a selective basis to an undertaking by a national public authority.
Whilst the EC Treaty (the ‘Treaty’) pronounces a general prohibition on State aid there is a recognition that in some circumstances, government interventions are necessary for a well functioning and equitable economy. There are therefore a number of policy objectives for which State aid can be considered compatible.
The Commission aims at ensuring that all European companies operate on a level playing field, where competitive companies succeed. It ascertains that government interventions do not interfere with the smooth functioning of the internal market or harm the competitiveness of EU Companies.
The 'State aid rules' are set out by the European Commission and are outlined in Articles 87 – 88 of the Treaty. The rules have been amplified over the years by secondary legislation and court rulings.
State Aid must be considered in all funding provided by Advantage West Midlands or through one of the funding programmes which the Agency manages. Projects can be funded by designing out any aid or ensuring that any funding is provided within the State aid rules.More information is available in the Related Documents and Related Links sections.
For a list of the potentially available schemes approved for use in the West Midlands and specific requirements of the most commonly used schemes click here.
