Mapping the Next Steps in Competition Policy Control of Regional Aid

Cite as: Wishlade, F. (2019) Mapping the Next Steps in Competition Policy Control of Regional Aid. European Policy Research Paper, No. 108, European Policies Research Centre, University of Strathclyde, Glasgow.

In contrast with recent developments in Cohesion policy and the preparations for the next MFF, this is a quiescent period in State aid control. Two major reform agendas – SAAP and SAM – have been completed and have overhauled almost every aspect of policy. In recent policy statements, the Commission has emphasised continuity and stability, rather than policy change, and a prioritisation of its efforts, characterised as ‘big on big, and small on small’. At the same time, there are hints of a retreat from State aid control as a means of improving the effectiveness and efficiency of public spending. The two major frameworks that regulate how and where regional aid can be used are due for review: both the Regional Aid Guidelines and the General Block Exemption Regulation expire at the end of 2020. The RAG, in particular, needs a long lead time for review owing to the need to redraw national assisted area maps ahead of time. A look back at the schedule for preparing the 2014-20 Guidelines suggests that the Commission will need to extend the current guidelines and associated maps beyond 2020. Spatial coverage is the defining feature of regional aid. This paper uses the most recent data to look at what the effects would be of ‘re-running’ the 2014-20 RAG spatial coverage methodology for EU27_2019 – ie. excluding the United Kingdom. The outcomes of this exercise involve some changes to the ‘a’ regions, notably in the Baltic countries and the Czech Republic, in line with the changes to Less Developed Region coverage under Cohesion policy. Perhaps more significant, at least in the short-term (since regions losing ‘a’ status automatically have transition status), the method for determining ‘c’ area coverage looks under increasing strain. A number of countries could expect to see assisted area coverage halved, even if overall population coverage were held at almost half the population.

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