Brussels, 15/12/2011 (Agence Europe) - European Commission checks to ensure that EU member states comply with their obligations to notify state aid are insufficient, according to a Court of Auditors' report published on Thursday 15 December. The report also points to the fact that procedures applying to state aid notified are lengthy, and that there is a lack of transparency in dispute settlement procedures. It does, however, come up with a good point - the Court of Auditors considers that the Commission has reacted swiftly to the financial crisis.
The audit focused on the organisation and the decision-making and monitoring processes of the Commission during the period 2008-10. It did not assess the validity of the decisions taken by the Commission. The scope of the audit covered the areas of state aid control for which DG Competition is responsible. These areas represented 96% of all state aid granted in 2009 (excluding railways) due to the specific large volume of aid granted to the financial sector. State aid control falls under the responsibility of the European Commission's DG Competition in all sectors except agriculture and fisheries.
Most member states' systems do not provide sufficient assurance that the duty to notify state aid is respected, the Court of Auditors states. It points out that there are “some occasional ex officio enquiries, but the Commission does not do enough to detect cases that should have been notified, mainly relying on complaints by third parties”, and goes on to deplore that “as a result, there is a risk of state aid going undetected”. Among other things, the audit reveals that the Commission does not monitor whether the ceiling for de minimis aid is complied with. The de minimis regulation has introduced a ceiling of €200,000 below which it is considered that aid does not affect trade between member states or does not distort competition and is therefore not considered to constitute state aid.
Furthermore, the Court of Auditors takes the view that, although many of the operational elements of the case handling are well managed and the financial crisis cases were handled quickly, the approval procedure for many notified state aid measures remains lengthy. For example, if one looks at the formal investigation procedure, the Commission should as far as possible endeavour to adopt a decision for notified cases within 18 months from the opening of the formal investigation procedure. The number of cases exceeding the recommended duration of 18 months is 38% (9/24) for formal investigation procedures launched in 2005, 13 % (4/31) in 2006, 33 % (9/27) in 2007 and 18% (3/17) in 2008. When also taking into account the preliminary investigation, the total duration between the notification and the Commission decision in these cases exceeded 2 years.
Complaint handling is particularly problematic (complaint processing took more than one year for half of the complaints, over two years in a quarter of the cases, and, for some, more than five years. Arrears are particularly significant in the field of transport). The rise in the number of complaints, combined with the length of procedures and the low priority given to them, has caused dossiers pending to accumulate. Finally, the Court considers that he Commission does not assess the ex-post impact of its state aid control. (LC/transl.jl)