Commission decides to prolong current State Aid framework for Research and Development

April 25, 2002

Brussels, 24 April 2002

The European Commission has decided to prolong the existing State Aid framework for Research and Development(1) without any modification until the end of 2005.

This decision was taken following a review of the framework, which the Commission initiated in March 2001(2) with a call for comments by Member States and any interested third party. Having assessed the comments received and following further deliberations on the issue, the Commission has decided to continue to apply the current rules until 31.12.2005. A communication to this effect will be published in the Official Journal.

The current rules distinguish between three different levels of research and development activity:

* fundamental research designed to broaden scientific and technical knowledge not linked to industrial or commercial activities may receive aid of up to 100% of eligible costs;
* industrial research is eligible for a basic rate of aid of up to 50% of eligible costs;
* pre-competitive development activities are eligible for a basic rate of aid of 25% of eligible costs.

These basic rates of 50% and 25% may be increased by a series of bonuses of up to a further 25% of eligible costs if the research and development activities are undertaken by SMEs, or in assisted areas, or further the objectives of the Community's own R&D programmes or promote effective cross-border collaboration. Higher rates also apply for feasibility studies.

The Commission is of the view that, on the whole, the current framework has functioned satisfactorily and that in particular the aid intensities permitted by the framework have proven to be favourable for research and development. Furthermore, it is also suitable for supporting the objective adopted by the Barcelona European Council which is to increase investment in research and development in Europe by 3% of the GDP by 2010. This objective should in the first place be achieved by efforts coming from the private sector directly. State aid for research and development is only one instrument among others to achieve this objective.

(1) OJ C 45 of 17.2.1996, p. 5, as amended by the Commission communication amending the Community Framework for State Aid for Research and Development, OJ C 48 of 13.2.1998, p. 2.

(2) Cf. OJ C 78 of 10.3.2001, p. 24.

DN: IP/02/606 Date: 24/04/2002

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