Brussels, 22/11/2006 (Agence Europe) - On Wednesday 22 November the European Commission adopted a new Framework to clarify to Member States how best they can give state aid to not only research and development but also innovation projects. The Framework sets out a series of guidelines for specific types of state aid measures - such as aid for R&D projects, aid to young innovative enterprises and aid to innovation clusters - that could encourage additional R&D&I investments by private firms, thus stimulating growth and employment and improving Europe's competitiveness. These guidelines allow individual Member States to tailor aid measures to particular situations, subject to the overall test that the aid must address a defined market failure, must be well designed and that the identified benefits must outweigh the distortions to competition resulting from the aid. The new Framework is due to apply from 1st January 2007.
The level of aid could reach 100% for fundamental research but will depend on the size of the company in: industrial research (70% for small firms, 60% for medium-sized companies and 50% for the big enterprises); research in cooperation or with the publication of results (80% for small firms, 75% for medium-sized companies and 65% for the big enterprises); experimental development (45% for small firms, 35% for medium-sized companies and 25% for the big enterprises); experimental cooperation (60% for small firms, 505% for medium-sized companies and 40% for the big enterprises). Maximum aid is set at 50% of allowable costs for temporary attachment of highly qualified staff. In the field of innovation, aid intensity should not supersede 15% for under-developed regions but where it can reach 30% if GDP is less than 75% of the EU average, 40% where a GDP is lower than 60% the Community average, 50% where the GDP is 45% less than the average. Extremely remote regions will benefit from a rise. Aid for keeping the innovation poles running can cover 100% of costs in the first year but then have to be reduced in a linear manner to reach zero at the end of the fifth year.
Given the framework of state aid, Member States will still remain obliged to notify their state aid measures to the Commission for verification and authorisation but the text limits the triggering of probes into aid that contain high competition distortion risks. This includes all aid notified under the per category exemption regime, as well as aid exceeding the following ceilings: €20 million for fundamental research, 10 million for industrial research projects, 7.5 million for other projects and feasibility studies in R&D, 5 million per enterprise for innovation aid and 5 million for aid to innovation poles. The complete text is available at: http: //ec.europa.eu/comm/competition/state_aid/reform/rdi_fr.pdf (oj)