Commission prepares to revise rules on R&D State aid

Brussels, 06 May 2003

While the Commission is welcoming news that 12 out of 15 Member States have reduced their State aid in accordance with a pledge made in Stockholm in March 2001, the institution is also preparing to revise the Community's stance on State aid for research and development (R&D).

The changes will be part of the general policy of redirecting State aid towards horizontal objectives. Horizontal objectives are areas considered to be market failures, in which aid is less distortive than sectoral aid. Horizontal objectives include R&D, safeguarding the environment, energy saving and support for small and medium sized enterprises (SMEs).

'Public support is justified by the recognised failure of the market to induce business investment in research at an optimal level,' claims the Commission's communication on 'investing in research: an action plan for Europe', adopted on 30 April.

The Commission would also like to make it easier for some entities to obtain State aid. A proposal is currently being drafted that will amend the block exemption for State aid to SMEs, widening it scope to R&D aid. This will mean that SMEs will no long have the burden of notifying State aid of this nature.

The Commission also envisages other actions to increase the effectiveness of State aid for R&D. The revised Community framework on State aid for R&D will define the cut-off point between research activities eligible for public support; outline changes in the role of public research establishments towards closer cooperation with industry; and assess the way in which public support for R&D is used by the Community's competitors, and its implications in terms of the level playing field for European enterprises operating in global markets.

Support for R&D is currently higher than for any other horizontal objective in Finland, Austria and Belgium, receiving 41, 40 and 20 per cent of State aid respectively. A recent scoreboard indicates that the share of aid grated to R&D increased by three percentage points between the periods 1997 to 1999 and 1999 to 2001 in the EU.

In Italy the share of R&D aid rose considerably - by ten percentage points. 'This may be seen in the context of the target set by the Barcelona European Council that overall spending on R&D in the Union should be increased with the aim of approaching three per cent of GDP by 2010,' reads the EU scoreboard on State aid.

To see the Commission's action plan, please consult the following web address:
http://europa.eu.int/comm/research/era/3 pct/index_en.html

To see the Commission's State aid scoreboard, please consult the following web address:
http://europa.eu.int/comm/competition/st ate_aid/scoreboard

CORDIS RTD-NEWS / © European Communities