Government subsidies to the fisheries and aquaculture sector
Like all industries in the EU, the fisheries and aquaculture sector is subject to the general EU restrictions on state subsidies. These make it generally illegal for national authorities to grant financial assistance to private companies, to ensure no country's industry thereby gains an unfair advantage.
Exceptions to this rule include:
- sums that are so small they are unlikely to have any significant impact on competition ("de minimis aid")
- certain types of subsidy which are considered not to distort competition whatever the sum involved - these are covered by a block exemption.
In all other cases, when national authorities wish to grant subsidies they must notify the Commission in advance, and comply with the Commission's decision on whether the aid is legal or not.
State aid rules for fisheries and aquaculture
State aid is in principle not compatible with the common market, but there are exceptions to this principle. (See Articles 107-109 of the Treaty of the Functioning of the European Union and the Guidelines for the examination of State aid to fisheries and aquaculture .)
As a rule, Member States have to notify the Commission on any State aid scheme they wish to put in place, and may not implement the scheme before the Commission has declared that it complies with the Treaty. (See Article 2 of Regulation 659/1999 and Article 2 of Regulation 794/2004).
How is the notification done?
The notification must be done electronically, via the Permanent Representation to the EU of the Member State concerned through the electronic system SANI. A special template [282 KB] for notification for aid to the fisheries and aquaculture sector must be used.
This notification form comprises 3 parts:
- Part I, which corresponds to the general information to be provided for any notification,
- Part II, which corresponds to the summary information which will be published in the OJ,
- Part III.14, which corresponds to the specific information to be provided for notification of State aid to the fisheries and aquaculture sector.
The notification is important. If a Member State puts a State aid scheme in place without notifying it to the Commission and waiting for its approval, the State aid will be considered unlawful (see Article 1, point f of Regulation 659/1999 ). In addition, after analysis, if the scheme is considered not compatible with the common market, the beneficiaries will be ordered to pay back the aid that they have received (see Article 14 of this regulation).
When is a notification not needed?
Certain types of State aid to the fisheries and aquaculture sector are deemed to be compatible with the common market, and therefore do not have to wait for approval by the Commission before they can be put in place (see Regulation 736/2008 ). Therefore they do not need a formal notification.
However, the Member State needs to supply a summary sheet to the Commission that gives information about the scheme (see annex 1 of Regulation 736/2008 [47 KB] ), and also needs to include the scheme in its annual report on State aid. This concerns measures for which there are clear rules defined under the European Fisheries Fund, such as temporary cessation of fishing.
The aid must meet the following conditions:
- Maximum amounts: the annual amount per beneficiary may not exceed 1 million Euros. The total amount of eligible costs per project may not exceed 2 million Euros.
- It must be aimed at small and medium-sized enterprises
- It has to be in line with the EFF regulation
- It cannot be given to a beneficiary who has been ordered to pay back incompatible State aid until that case has been closed.
However, please note that some EFF measures, such as modernisation of vessels, are subject to case-by-case analysis by the Commission and needs therefore a formal notification.
Annual report on State aid
Each year, Member States have to prepare a report on all the State aid
it has given during the year, including aid that falls under the de
minimis rules. The report has to be submitted in electronic format by the
deadline 30 June (see Articles 5 and 6 of Regulation 794/2004; the information to be submitted is
explained in Annex III C in the same regulation).
The EC Court of Justice has ruled in a case when a Member State failed to send in its annual reports within the deadline (see Judgment of the Court of Justice of 12 January 2006 – Commission v Luxembourg (Case C-69/05))
De minimis rules for fisheries
De minimis aid is national aid that is not considered to distort competition. The de minimis rules for the fisheries sector (adopted in 2007) state that a limited amount of State aid can be given to fisheries companies (30 000 Euros per company over a period of three fiscal years). If the total amount of funding given by a Member State to its fishing industry does not exceed 2.5 % of the total production value of the fisheries sector, the Member State does not need to make a formal notification of the scheme. However, any de minimis aid needs to be included in the Member State's annual report on State aid.
The de minimis aid
- cannot be given to companies in difficulty
- has to be managed in a transparent way
- may not be used to construct or purchase fishing vessels
- may not be used in such a way that it disrupts the common organisation of the market for fisheries products
- may not exceed the ceiling of 30 000 Euros for any period of three fiscal years. Member States are not allowed to circumvent this maximum amount by splitting the aid into several payments.
Member States need to put in place control measures, which make it possible to verify that the rules have been respected.
Other types of aid to fisheries and aquaculture
European Fisheries Fund and temporary fleet measures
- Funding that is co-financed by Member States under the rules of the
European Fisheries Fund (EFF) generally is not considered as State aid. (See Regulation 1198/2006, article 7).
- Temporary specific actions to promote the restructuring of the EU fishing fleets affected by the economic crisis (adopted in 2008 in response to the sharp rise in fuel prices) are also generally not considered as State aid (see Regulation 744/2008 , article 4).