15.1.2013   

EN

Official Journal of the European Union

C 11/49

1.1

European state aid policy is of strategic importance for the EU in a highly competitive globalised economy.

1.2

The EESC considers that the reform proposed in the Commission's communication should be supported in view of the objectives of that reform, which are:

1.3

The EESC shares the Commission's vision of strengthening the positive connection between effective state aid and the objective of sustainable and inclusive growth. A targeted state aid policy will make it possible to stimulate innovation (including social innovation), the use of green technologies and the development of human capital while avoiding environmental damage. A dynamic, well-targeted state aid policy can make an active contribution to achieving high levels of employment and social cohesion.

1.4

However, this reform, with its ambitious goals, methods and timetable, needs clarification in certain respects.

1.5

The EESC calls on the Commission to clarify certain concepts used in the communication:

1.6

The EESC has certain queries to raise in relation to the planned reforms:

1.7

Finally, the EESC proposes certain changes which it considers necessary due to the need, recognised by the Commission and the Council, to support SMEs, particularly at a time when they are facing competitive pressures from third country firms that benefit from direct and indirect state aid that is both greater in amount and allocated in a less transparent way.

1.7.1

The EESC proposes that the ceiling for de minimis aid (which is applied to each firm on the basis of a rolling period of three consecutive years) should, in view of its small amount, its benefits for SMEs and very small enterprises and its limited impact on the internal market, be permanently increased from EUR 200 000 to EUR 500 000, as was recently decided in relation to services of general economic interest.

1.7.2

Considering the need to help European SMEs develop international markets, the EESC proposes an amendment to Article 27(3) of the General Block Exemption Regulation providing for the compatibility with the common market of aid to SMEs for participation in fairs and exhibitions for a period not exceeding three consecutive years.

1.8

The EESC has three practical recommendations for the Commission based on its own experience:

2.1

The Commission intends to reform European state aid policy along three main lines:

2.2

The reform is based on a mixed assessment of the current policy:

2.3

To address this situation, in a context in which full advantage must be taken of the potential of the single market (for example in energy, transport and digital technologies), the Commission is proposing a reform with ambitious goals, methods and timetable.

2.4

The proposed reform has ambitious goals in that it involves, on the one hand, making one of the oldest and best integrated EU policies support growth in Europe, and on the other hand achieving rather radical procedural improvements, although those improvements are neither set out in detail nor quantified in the communication.

2.5

The proposed reform is ambitious as to its methods in that the Commission proposes to make a coherent set of changes all at once, within the framework of an "integrated strategy", involving:

2.6

The timetable of the proposed reform is ambitious in that the Commission aims to adopt the proposals for revision of the procedural regulation and the enabling regulation in Autumn 2012, and the other elements of the "package" by the end of 2013 – in other words, before the financial perspectives for the 2014-2020 period come into force.

3.1.1

The EESC supports the goals announced in the Commission's communication, which aims to "facilitate the treatment of aid which is well-designed, targeted at identified market failures and objectives of common interest", by focusing enforcement on cases with the biggest impact on the internal market, by streamlining the rules and taking faster decisions.

This approach is part of a more general development in competition law, concerning both antitrust law (i.e. restrictive agreements and abuse of dominant position) and merger control.

3.1.2

In relation to antitrust law, the "modernisation of competition law" put in place by Regulation 1/2003 (1) and its accompanying texts began the decentralisation of competition law enforcement by ending the prior notification system. That has allowed the Commission to focus its activity on tackling the most serious restrictions and abuses, particularly cartels. This modernisation was accompanied by strengthened cooperation between the network of national competition authorities on one side and the Commission on the other.

3.1.3

In relation to merger control, Commissioner Almunia recently announced a possible forthcoming reform of the European merger control system with the aim, in particular, of allowing the Commission to focus on those mergers that are most likely to affect the market (2). In the short term, that would involve streamlining the handling of the least problematic cases by improving the "simplified procedure" and reviewing the pre-notification procedure. In the longer term, the merger control regime could be revised, by scrutinising acquisitions of non-controlling minority stakes and through better interaction between the national and European systems in relation to thresholds and referrals.

3.2.1

The EESC reiterates its support for a general state aid framework based on the following principles (3):

3.3.1

The EESC's understanding is that focusing enforcement by the Commission on the most problematic cases would in particular depend on broadening the range of aid measures which are exempt from the notification obligation. That would necessarily be linked to greater responsibility for the Member States. The EESC notes, however, that the specific features of state aid law would need to be taken into account. The state and, more broadly, all state and public entities that may grant aid would, in a sense, be judge in their own cause.

3.3.2

Giving more responsibility for state aid control to Member States risks leading to subjective application of the rules by Member States, unfair behaviour by states and the return of a certain economic nationalism that would end up increasing legal uncertainty for firms.

3.3.3

Several approaches could be considered in order to limit this type of risk to the minimum:

3.4.1

The Commission and the Member States showed their ability to respond to the economic and financial crisis by adopting a series of specific texts between 2008 and 2011 (5). Due in particular to greater cooperation on the part of the Member States and a major mobilisation by the Commission services, decisions were taken in very short timescales, to the satisfaction of Member States and firms.

3.4.2

Generally speaking, however, stakeholders still find that the procedures are too long and complex. The EESC therefore supports the Commission's intention to tackle the long timescales for handling cases by improving administrative practices and by calling on the Member States to take responsibility in order to ensure transparency and efficiency. The timescales must, to the extent possible, match the rhythm of economic activities.

3.4.3

In this respect, the "simplified procedure" for dealing with certain types of aid (6) could be extended, while remaining circumscribed. Under this procedure, the Commission simply checks whether the aid measure complies with the existing rules and practices.

3.5.1

Effective implementation of state aid law is essential. However, the EESC notes that national courts are often not in a position to ensure that state aid law is enforced efficiently, particularly in relation to protecting the rights of firms that suffer as a result of the grant of illegal aid measures to their competitors. Several reasons for this could be mentioned, including the fact that judges lack expertise in European competition law and the procedural restrictions which are an inherent part of litigation.

3.5.2

Solutions should be developed to allow better enforcement of state aid law in practice. Both firms and national courts should have more effective tools and procedures at their disposal.

4.1.1

The EESC supports the aim of approving only those aid measures that (i) contribute to supporting growth by seeking to remedy a market failure (a grant of state aid should complement, not replace, private expenditure) and (ii) have an incentive effect, that is to say that they induce the beneficiary to undertake activities that it would not have carried out in the absence of aid.

4.1.2

In this context, it is essential for the concept of "market failure" to be clarified and illustrated with examples from different fields, based in particular on the existing European case law, to help firms as well as public authorities to understand the concept in a consistent way and apply it to state aid measures at the design stage.

4.2.1

Paragraphs 16 and 17 of the communication refer to third countries' competition policies. The Commission concludes that, while the EU has a more transparent framework, it allows comparable levels of aid. That statement is based on a comparative analysis carried out by the WTO in 2006. The EESC calls on the Commission to have the WTO undertake a more up-to-date study, since many non-EU WTO member countries have provided massive subsidies in the context of the crisis, particularly for manufacturing industry. The competition policy that will come into effect from 2013 should be based on a detailed, recent picture of the situation in, for example, the United States, China, India and Brazil (including aid granted by the federal states) in a context where economic competition has been sharpened by the global crisis.

4.2.2

The state aid rules should be implemented in such a way as to allow the strengthening of firms' competitiveness, both in the internal market and internationally. However, European firms face competition from companies based in third countries, whose legislation sometimes contains no restrictions on state aid. That can lead to serious competition distortions, to the detriment of European firms, as the Commission notes in the communication (7).

4.2.3

Within the scope of its powers, the Commission undertakes initiatives aimed at establishing a global level playing field, based around the concept of fair competition. Any reform of state aid law must therefore be coordinated with the action that the Commission is taking elsewhere, using trade policy instruments such as WTO rules and bilateral free-trade agreements.

4.3.1

In its proposal for a regulation establishing a programme for the competitiveness of enterprises and small and medium-sized enterprises 2014–2020 (COM(2011) 834 final), the Commission recognises the need to find a springboard for growth by helping SMEs export within the EU and globally. Assistance and support services to SMEs with growth prospects are to be provided through the Enterprise Europe Network.

4.3.2

At the same time, however, the Commission's approach seems too restrictive, since, for example, there are several cumulative conditions set out in Article 27 of Regulation 800/2008 of 6 August 2008 in relation to the participation of SMEs in trade fairs and exhibitions: the aid must not exceed 50 % of the eligible costs, can only be granted to firms which fall within the EU definition of SMEs, and may only be granted for their first participation at a fair or exhibition.

4.3.3

We consider this "first participation" requirement to be inappropriate in relation to an international development strategy, which requires a presence of at least three years on a given market before the development strategy (agency, establishment or distribution) can be chosen. The EESC therefore proposes replacing the "first participation" requirement in Article 27(3) with a requirement of "participation in a fair or exhibition for not more than three consecutive years", while leaving the other two requirements unchanged.

4.4.1

The EU should ensure that state aid stimulates innovation – including innovation in the social field, where the Innovation Union has already recognised the need for aid for social innovation – the use of green technologies and the development of human capital as part of a sustainable development model. The EESC welcomes the growing recognition of aid for social innovation as being compatible with the internal market (8) and hopes that this trend will strengthen in future in the context of the state aid modernisation process.

4.4.2

The EESC also supports a notion of state aid for research and development that covers the design, production and marketing of products, programmes and services that are accessible to vulnerable groups in society, particularly disabled people (9).