When it comes to determining whether aid constitutes State aid, the determining factor is not the type of aid but whether the measure confers an advantage.
The test to determine whether aid constitutes State aid involves the presence of five cumulative criteria.
The EU State aid regime is laid down in Articles 107, 108 and 109 of the Treaty on the Functioning of the European Union (TFEU). The test to determine whether aid constitutes State aid involves the presence of five cumulative criteria:
the aid is granted to an undertaking engaged in economic activity
the aid is paid for out of State resources
these State resources give the beneficiary an economic advantage not compatible with the internal market
the aid is granted on a selective basis
the aid is likely to affect market competition and trade between Member States
If any one of these criteria is not met, the State aid regime does not apply.
And even if all criteria are met, the measure need not be notified to the European Commission in every instance to receive approval, as an exemption may apply.
Under Regulation (EU) No 1407/2013 (the De-minimis aid regulation), small amounts of aid - a.k.a. de minimis aid - may be granted to undertakings without violating the prohibition against State aid. This condition is fulfilled if the total amount of de minimis aid granted per Member State does not exceed EUR 200,000 over any period of three (3) fiscal years.
Regulation (EU) No 2021/1237 provides for general block exemptions for a range of aid categories, such as regional aid, aid for the deployment of broadband infrastructure, aid for regional airports, and aid for projects in the area of digital connectivity. Each category is subject to separate conditions - on the maximum amount of aid granted, for example - that must be met to be eligible for the block exemption.
Undertakings in the agricultural sector can apply for State aid pursuant to Regulation (EU) No 2022/2472. Examples would be aid to make good damage caused by natural disasters or aid for the forestry sector. This regulation sets out the conditions that must be met to be eligible for the exemption.
Regulation (EU) No 2022/2473 allows for Member States to provide aid, without notification being required, to undertakings active in the production, processing and marketing of fishery and aquaculture products.
Our experts are well-placed to advise whether the exemptions apply to your situation.