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State aid: Commission invites comments on use of state aid rules for supporting risk capital investments

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In the context of its state aid modernisation initiative (SAM) (see IP/12/458), the European Commission has launched a review of the risk capital guidelines as amended on 1/12/2010, which outline the criteria for assessing the compatibility of public support measures in this field. The review starts with a public consultation, seeking stakeholders' views on the functioning of the guidelines since their adoption in 2006 and in particular on market developments concerning the supply of equity and debt finance to small and medium sized enterprises (SMEs). In light of the submissions received and its own experience in applying the guidelines, the Commission will propose revised draft guidelines in 2013, with a view to contributing to the objectives of the Europe 2020 strategy for a smart, sustainable and inclusive growth. Submissions can be made until 5 October 2012.

The purpose of the present consultation is to invite Member States and other stakeholders to provide comments on the application of the risk capital guidelines and on SME access to finance at large. Moreover, the Commission will examine how the guidelines can support the SAM project, designed to foster growth - in particular by facilitating well-designed aid targeted at genuine market failures - and to speed up, simplify and refocus state aid control. In particular, the guidelines will be reviewed with a view to best channelling public resources towards access to appropriate finance for innovative and growth-oriented SMEs.

The consultation seeks to gather information on market developments concerning the supply of equity and debt finance to viable SMEs. The questionnaire also contains questions on general policy and on the use and effectiveness of public financing in Member States. It also contains more detailed questions on the experience with the application of the current guidelines. Finally, the questionnaire contains questions on the provisions on risk capital of the General Block Exemption Regulation (GBER, see IP/08/1110) that exempts certain categories of aid measures from a prior Commission approval, in order to ensure coherence between the different instruments.

The guidelines and the questionnaire are available at:

http://ec.europa.eu/competition/consultations/2012_risk_capital/index_en.html

Background

Member States' plans to support with state funds selected companies carrying out economic activities need, in principle, to be notified to the Commission and cannot be implemented before they have been approved. The primary objective of state aid policy in the field of risk capital is to tackle a market failure related to an insufficient supply of capital to viable SMEs in their early development stages and to ensure that the positive effects of the aid outweigh its negative effects in terms of distortions of competition. The rules for assessing public support for risk capital investments are contained in the risk capital guidelines as amended on 1/12/2010 and in the GBER. A review of the GBER was launched in June 2012 (see IP/12/627).

On 8 May 2012 the Commission adopted an ambitious state aid reform package (SAM, see IP/12/458) with the objective of supporting the broader EU goal to foster growth. In this context, state aid policy should focus on facilitating well-designed aid targeted at market failures and objectives of common European interest. The Commission also aims at focusing its enforcement on cases with the biggest impact on the internal market, streamlining rules and taking faster decisions. SAM identifies a number of actions with a view to implementing these objectives. The main elements of the reform shall be in place by the end of 2013.

Press release

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