Simplification of the ETC 22 November 2017, CoR, Brussels State Aid simplification Simplification of the ETC 22 November 2017, CoR, Brussels Przemyslaw Kniaziuk, Interact Programme

What do ETC Programmes have in common?   The same challenge reported over the years in different parts of Europe… Spain-Portugal (POCTEP) (…) state aid is a difficult issue for the projects. Regulations are confusing and not clear in many points. Germany-France-Switzerland (Upper Rhine) State aid questions are a difficult issue for the programme as well. The MA/JS intends to build up more competence in this field. 

What do ETC Programmes have in common?   Sweden-Denmark-Norway (Öresund-Kattegat-Skagerrak) State aid is considered as a complication of the implementation of the programme. The member states want to be on the safe side, thus they narrow EU regulations state aid and FLC must be applied by all countries in a common way: "Football rules are global." Greece-Bulgaria One of the main difficulties for the programme is the application of state aid rules. MA and JS regard it as hard to find good and joint solutions.  

What do ETC Programmes have in common?   Romania-Hungary The new MA had to set up the programme management and the partners could not find a consensus on several aspects (documents, procedures, state aid questions etc.). State aid is a big problem for applicants. Regional MC members miss clear guidance from the MA. Source: Hermannek P., Assessment of Interreg cross- programmes' governance systems and their appropriateness to address border obstacles, commissioned by DG Regio, 2017, Potsdam.  

State aid and private sector   State aid identified as a main bottleneck and obstacle of private sector participation: Complying with state aid law as the first of seven principal obstacles of private partners participation in ETC Programmes Source: Study on involvement of the private sector in European Territorial Cooperation Programmes commissioned by CGET, 2015 Obtaining clarity as to whether state aid is permitted can delay or may even block the application phase. The amount of research and the long lead-time for state aid notifications may result in deadlines not being met. Source: Micro-enterprises in INTERREG VB, 2014, releef report commissioned by Netherlands Enterprise Agency

State aid and private sector   Management of State aid and ensuring compliance with State aid rules have been named by programmes (both those open to SMEs as beneficiaries and those not allowing SMEs to participate) as the most challenging issues to deal with during the current period (2007-2013). Source: Involvement of SMEs in ETC programmes: achievements & future perspectives, Interact, 2013

Magnitude and influence of ETC Programmes on the Common Market    

Problems experienced (1)   No tools and resources to perform proper checks (eg. A single undertaking, not in difficulty, an SME status or received de minimis) - the whole system based on self-declarations State aid responsibilities very national (TAM access only per MS, SARI reporting partly adapted, not reflecting multinational composition of projects) Second level state aid responsibilities very unclear (eg. programme managed by the French MA a Luxemburgish partner offering voucher (de minimis) to a British SME) High administrative burden for small amounts (second level de minimis - the same procedure for 500 eur and 200 000 eur). Large undertakings excluded from article 20, but often important project partners (companies + public administration) Multiple de minimis thresholds for ETC programmes still questioned (by MS, national experts, programmes, AAs)

Problems experienced (2)   GBER not very well adapted, SA generally excludes agriculture (crossborders often rural) and fisheries (sea-basin programmes) GBER maximum intensity levels lower than the regular co-financing rate of the programme (85%/75% vs. 50% for art. 20) GBER large companies should report the net revenue eg. for art. 25 – where is the incentive for financially viable projects? On one hand involvement of private sector is desired on the other a lot of hindrances caused by the regulations It is estimated that between 72 and 103 million euro will be spent on the State Aid compliance by 79 ETC programmes in the 2014-2020 period (only costs generated by assessments of JS/MA, external experts, FLC. But no MC, CA, AA or intangible costs included!) Source: Targeted review of the General Block Exemption Regulation (State aid): extension to ports and airports, H.4691, Interact Programme

Cooperation = genuine European interest Simplification?   Cooperation = genuine European interest Programme logic + several MS (or even all EU-28 for some programmes) deciding = mechanism to prevent one MS to grant aid to one undertaking with risk of real market distortion European Aid ≠ State aid More like Horizon 2020, COSME, TEN-T (resources awarded directly by the Union) General exemption for ETC?

Solution? As proposed in the Report – High Level Group proposal for policymakers for post-2020, led by Siim Kallas Simplification: exempt ETC programmes from the application of state aid rules given the low value of projects and the unlikely negative impact on trade and competition.