State aid for research

The new Community framework for state aid for research and development and innovation, adopted by the Commission on 22 November 2006 and published in the Official Journal on 30 December 2006 (OJ C 323, 30.12.2006, p. 1), entered into force on 1 January 2007. Press release on the adoption / Memo / Full text.

Research and innovation generally thrive best in open and competitive markets. However, as explained in the State Aid Action Plan [ - 204 kb] adopted in 2005, market failures may hamper the delivery of optimal levels of research and innovation. The Action Plan aims to reduce State aid gradually while refocusing it on activities that have the most sustainable impact on competitiveness, jobs and growth, such as research and development. In 2005, 12 % of State aid (not counting aid for agriculture, fisheries and transport) in EU-25 was devoted to R&D, amounting to € 5.4 billion. Member States are invited to increase this proportion.

State aid, among other policy tools, can tackle market failures and create incentives for market participants, thus facilitating research and innovation.

Previous rules already provided wide possibilities for Member States to support research and development through State aid. However, the Commission reviewed them in 2006 in order to better reflect Community policy priorities such as promoting cross-border research cooperation, public-private research partnerships, dissemination of research results and major research projects of common European interest. This will contribute to creating a more research and innovation-friendly business environment.

The review was prepared notably through a public consultation on State aid for innovation, which put forward concrete proposals to include State aid rules for innovation, to increase funding possibilities as well as legal certainty.

In addition the Commission reviewed the rules for State aid and risk capital.

The Commission will also encourage eco-innovation and improvements in productivity through eco-efficiency in line with the Environmental Technology Action Plan, in particular when revising the Community guidelines for State aid on environment.

Before mid-2008, the Commission also intends to adopt a General Block Exemption Regulation which will simplify the introduction of new R&D schemes by lifting the notification obligation. The consultation on the draft regulation was opened on 24 April 2007 and lasts until 3 June 2007. Press release / Memo / Full text.

More details and reference documents on State aid reform are available on the Website of the Directorate-General for Competition.