Commission notice on the expiry of the guidelines on State aid for undertakings in deprived urban areas (notified under document number C(2002) 1806) (Text with EEA relevance)
Date: 2002-05-22
Institutions: European Commission
Subjects: State aid, aid to undertakings, employment aid, less-favoured region, metropolis, socioeconomic conditions, urban area

22.5.2002

EN

Official Journal of the European Communities

C 119/21

Commission notice on the expiry of the guidelines on State aid for undertakings in deprived urban
areas

(notified under document number C(2002) 1806)

(2002/C 119/11)

(Text with EEA relevance)

Journal

1. The guidelines on State aid for undertakings in deprived
urban areas have been adopted by the Commission on 2
October 1996 and were published on 14 May 1997 in the
the European Communities (1). These
Official
guidelines lay down rules for identifying urban districts
which can be classed as deprived urban areas eligible for
State aid subject to certain conditions and ceilings which, if
met, allow the aid to be considered compatible with the
common market.

of

considerations) have rendered the guidelines so restrictive
that they could not effectively be used.

this instrument after

4. Modernisation of State aid rules must include abolishing
obsolete or inappropriate rules. Since no use has been
it was adopted by the
made of
Commission,
to prolong the
guidelines on State aid for undertakings in deprived urban
areas in its current form beyond May 2002 nor to propose
a revision thereof.

suggested neither

is

it

5. Obviously, schemes or individual cases granting State aid to
undertakings in deprived urban areas approved in the past
under other legal bases will in no way be affected by the
non-prolongation of the guidelines on State aid for under-
takings in deprived urban areas.

the non-prolongation of

6. The Commission recognises that, in some instances, market
forces alone appear to be inadequate to resolve or alleviate
the socioeconomic problems of deprived areas. It follows
that
the guidelines does not
imply that State aid for deprived urban areas would no
longer be possible. Such aid may be found compatible
under the existing rules applicable to State aid or, as the
case may be and depending on the specific circumstances of
the proposed aid in question, directly on the basis of Article
87(3)(c) of the EC Treaty. The Commission will examine any
in the light of Community objectives,
such cases
in
particular
those pursued by the Community regional
policy. Based on the experience gained in such future
cases, the Commission will also examine whether there is
a need for an additional, specific instrument dealing with
State aid for undertakings in deprived urban areas and what
the basic features for such an instrument would need to be.

2. Paragraph 20 of the guidelines on State aid for undertakings
in deprived urban areas states that ‘[t]hese guidelines have
been approved for a period of five years from the date of
publication in
European
Journal
Communities. Prior
the
to the expiry of
Commission will review the functioning of the guidelines
in order to decide whether they should be extended or any
amendments should be made’. The guidelines will
thus
expire on 14 May 2002.

of
the
that period,

the Official

3. It appears that in the past five years there have been no
cases where a Member State has granted aid under the
guidelines.
the eligibility criteria imposed, which
include:

Indeed,

— targeting only certain population groups in urban areas

(thus excluding, for example, rural areas),

— the restriction that total population in selected areas

must not exceed 1 % of national population,

as well as the form of the aid which is limited to investment
and employment aid linked with such investment
(thus
like environmental or social
excluding other objectives,

(1) OJ C 146, 14.5.1997, p. 6.