State aid: Commission authorises aid scheme by the French Agence de l’innovation industrielle for innovation-mobilising programmes

July 20, 2006

Brussels, 19th July 2006

Agence de l’innovation industrielle forinnovation-mobilising programmes

The European Commission has decided not to raise any objections under the Community rules on state aid to the aid scheme introduced by France and administered by the Agence de l’innovation industrielle. The scheme, which provides support for programmes designed to mobilise industrial innovation, has an annual budget of EUR 1 billion. The Commission took the view that the scheme met the conditions set out in the Community framework for state aid for research and development. Aid amounting to more than EUR 5 million to finance programmes costing more than EUR 25 million must nevertheless be notified to the Commission for individual examination before it can be granted.

Competition Commissioner Neelie Kroes said: "The establishment of the Agence de l’innovation industrielle is in line with the Commission's strategy of supporting economic growth and job creation. However, in accordance with the current rules, given their potential impact on competition, the programmes will have to be notified individually to the Commission before they are embarked on. The Commission will check in particular that aid provided by the Agence for programmes is not detrimental to the interests of other European competitors."

The Agence de l’innovation industrielle was set up in August 2005 in response to a report drawn up by Mr Beffa, the CEO of Saint-Gobain, for President Chirac in January 2005. The purpose of the Agence is to select, finance and assess major strategic programmes which, under the impetus of a lead company, bring together large industrial companies, small and medium-sized enterprises (SMEs) and research laboratories. The programmes will involve investment amounts of several hundred million euros and must comprise a large degree of innovation, such as the introduction of new scientific developments or the integration of a number of complex technologies. The aim is to create a new high-tech product or service within five to ten years.

The Agence has a annual budget of EUR 1 billion for 2005 and 2006 and should finance 10 to 20 programmes a year. Aid provided by the Agence takes the form of grants and repayable advances amounting to 50% of the costs of industrial research and pre-competitive development. The aid should enable selected companies to embark on ambitious and risky R&D programmes that go beyond their normal business strategy.

The Commission took the view that the aid scheme met the conditions laid down in the Community framework for state aid for research and development. The scheme therefore qualifies for the derogation provided for in Article 87(3)(c) of the EC Treaty.

However, under the Community framework, all aid of more than EUR 5 million provided to finance programmes costing more than EUR 25  million must be notified to the Commission for individual examination before being granted. When examining such aid, the Commission will ensure that the projects are in fact aimed at improving European competitiveness and do not entail any major distortion of competition in the single market.

Item source: IP/06/1020 Date: 19/07/2006

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