Energy: State aid to the coal industry

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State aid to the coal industry

The Directorate-General for Energy deals with State aid in the area of coal.

It is also involved in the preparation of state aid decisions by other Directorates General (Competition , Agriculture , Fisheries ). State aid control, as an integral part of competition policy, helps maintain competitive markets. The EC Treaty prohibits any aid that distorts or threatens to distort competition in the common market. State aid may lead to distortion of competition by favouring certain firms or the production of certain goods. Controlling state aid therefore guarantees a level playing field for all firms operating within the internal market.

Community law allows some exceptions to the general prohibition on State aid where the proposed aid may have a beneficial impact in overall Union terms. State aid measures can therefore be effective tools for achieving objectives of common interest (services of general economic interest, social and regional cohesion, employment, research and development, sustainable development, promotion of cultural diversity, etc.) and for correcting "market failures".

State aid may therefore be compatible with the Treaty provided that it fulfils clearly defined objectives of common interest and does not distort competition to an extent contrary to the common interest. Control of state aid is fundamentally about balancing the negative effects of aid on competition with its positive effects in terms of common interest, although the presumed advantages for the common interest must outweigh the negative effect of the distortion of competition.

Many of the general State aid rules are applicable to the transport sector (for example, the general block exemption Regulation, the de minimis Regulation and others). Specific sectoral rules and State aid cases on the sector are dealt with by the Directorate-General for Transport and Energy.

With regard to State aid to coal, since the expiry of the ECSC Treaty, Council Regulation 1407/2002 sets the legal framework for the authorization of aid to the coal sector.

Coal

State aid to the coal industry

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