State Aid Notes

These notes support May 2020’s Company Registration form.

For full State Aid information refer to the BIS guidance: https://www.gov.uk/guidance/state-aid

The De Minimis regulation allows Member States to give comparatively small amounts of support up to a certain limit, which may be paid for almost any purpose, as long as it meets all of the conditions set out in the Regulation. Prior notification and approval are not necessary as long as the requirements of the regulation are met.

Legal basis for De Minimis is the Commission Regulation on the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union to aid.

De Minimis aid is used to describe small amounts (€200,000 over a 3 year fiscal period) (€100,000 in the road freight transport sector) of support which complies with the De Minimis. 4.3 The European Commission considers that public funding which complies with the De Minimis regulation has a negligible impact on trade and competition, and does not require notification and approval.

De Minimis can be given for most purposes, including operating aid, and is not project-related:

The maximum De Minimis funding any single recipient can receive is €200,000 (cash grant equivalent) over a 3-year fiscal period. You must take steps to ensure the limit is not exceeded and that you can demonstrate this, hence this form.  The road freight hire sector has a limit of €100,000.

The sterling equivalent is calculated using the Commission exchange rate (See journal exchange rate http://ec.europa.eu/unitedkingdom/work_with_eu/rates/index_en.htm) applicable on the written date of offer of De Minimis funding.

The above ceilings apply to the total amount of De Minimis aid to a single recipient from all sources of De Minimis aid.

De Minimis aid cannot be given towards the same costs that are being supported under another block exemption or notified scheme if it means that the total aid would exceed what is allowed under the block exemption or notified scheme. De Minimis aid could be given for separate costs however.

De Minimis aid cannot be given for:

  • Aid for “export-related activities”, in particular assistance which is linked to exported quantities, assistance to establish or operate a distribution network, and other current expenditure linked to exporting is not permitted, but you can support attendance at trade fairs. 
  • Aid contingent upon the use of domestic over imported goods
  • Agriculture and fisheries. If you wish to give aid for agricultural activities, separate De Minimis regulation applies. Please contact Defra for more information as they have their own €15,000 limit under EC regulation 1408/2013

The full text of the De Minimis Regulation should be consulted for definitive guidance. http://ec.europa.eu/competition/state_aid/legislation/de_minimis_regulation_en.pdf

Where the De Minimis threshold is exceeded, you must use Training Aid.

Legal basis for the (Training Aid) General Block Exemption Regulation (GBER) is the Commission Regulation EU No. 651 / 2014 declaring certain categories of aid compatible with the internal market in application of Articles 107 and 108 of the Treaty (General block exemption Regulation).

The promotion of training constitutes a central objective of the economic and social policies of the Union and its Member States.

Training usually generates benefits for society, increasing the pool of skilled workers and improving the competitiveness of industry. Aid to promote training is therefore exempted from the notification requirement under certain conditions. In light of the particular handicaps that SMEs face and the higher relative costs they must bear when they invest in training, the intensities of aid exempted by the General Block Exemption Regulation (GBER) are increased for SMEs. Additionally, the intensities of aid exempted are further increased if the training is given to disadvantaged workers or to workers with disabilities.

The GBER covers aid up to €2 million per training project providing certain conditions are met. Any individual aid with a grant equivalent exceeding €2 million per training project must be notified to the Commission for prior approval. Aid cannot be granted for training which is carried out to comply with national mandatory standards on training.

Eligible Costs and Aid Intensities. The eligible costs shall be the following:

(a) trainers’ personnel costs, for the hours during which the trainers participate in the training;

(b) trainers’ and trainees’ operating costs directly relating to the training project such as travel expenses, materials and supplies directly related to the project, depreciation of tools and equipment, to the extent that they are used exclusively for the training project. Accommodation costs are excluded except for the minimum necessary accommodation costs for trainees who are workers with disabilities;

(c) costs of advisory services linked to the training project;

(d) trainees’ personnel costs and general indirect costs (administrative costs, rent, overheads) for the hours during which the trainees participate in the training.

The aid intensity must not exceed 50% of the eligible costs. It may be increased, up to a maximum aid intensity of 70% of the eligible costs, as follows:

(a) by 10 percentage points if the training is given to workers with disabilities or disadvantaged workers;

 (b) by 10 percentage points if the aid is granted to (51 to 250 employees) medium-sized enterprises and by 20 percentage points if the aid is granted to small enterprises (less than 50 employees);

Note: 

  • The value of the aid may not be the value of the funding provided by the Education and Skills Funding Agency.  It should be the cost of providing the training, as shown above under eligible costs.
  • Where the aid provided will be 50% of the costs of training, for example, the employer will need to provide evidence for the remaining 50% of the costs through timesheets of the learner and confirm hourly rates.
  • Evidence of the enterprise’s contribution must be signed by the employer and retained by the provider.

You must refer to the full text of the regulation: http://ec.europa.eu/competition/state_aid/legislation/block.html