State Aid Scoreboard - Spring 2003 update
Date: 2003-04-30
Institutions: European Commission
Subjects: EU Member State, EU statistics, State aid, aid to undertakings, control of State aid, regional aid

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 30.4.2003
COM(2003) 225 final

State Aid Scoreboard

Spring 2003 update

(presented by the Commission)

State Aid Scoreboard, spring 2003 update

Contents

Executive summary .................................................................................................................... 4

Introduction ................................................................................................................................ 8

Structure ..................................................................................................................................... 9

Limitations.................................................................................................................................. 9

State aid Register - a second transparency tool .......................................................................... 9

Part One: Overview of State aid in the European Union.......................................................... 10

1.1

1.2

1.3

State aid in absolute and relative terms ...................................................................... 10

Sectoral distribution of aid ......................................................................................... 13

State aid to the manufacturing sector ......................................................................... 15

Part Two: Adopting an economic approach towards less and better State aid......................... 16

2.1

2.2

2.3

2.4

Horizontal and sectoral objectives ............................................................................. 17

Coal and Steel............................................................................................................. 19

State aid supporting regional development and cohesion .......................................... 20

State aid instruments .................................................................................................. 24

Part Three: Procedural performance in the European Union ................................................... 27

3.1

3.2

3.3

3.4

Registered aid cases ................................................................................................... 27

Commission Decisions............................................................................................... 27

Recovery of aid .......................................................................................................... 28

Modernising State aid control .................................................................................... 29

State aid fora............................................................................................................................. 31

Technical annex........................................................................................................................ 32

Annex 1 .................................................................................................................................... 39

2

Graphs and Tables

Table 1: State aid in the Member States, 2001....................................................................... 10

Graph 1: State aid as a percentage of GDP, 2001................................................................... 11

Table 2: State aid per capita, 1997-2001................................................................................ 11

Graph 2:  State aid (less agriculture, fisheries and transport) as a percentage of GDP,

1997-2001 ................................................................................................................ 12

Table 3: Sectoral distribution of aid, 2001............................................................................. 13

Table 4:  State aid by sector in the Community 1997-2001.................................................... 14

Table 5:  Share of State aid by sector in the Member States 1997-2001 ................................ 14

Table 6:  State aid to the manufacturing sector, 2001............................................................. 15

Graph 3:  State aid to the manufacturing sector, 1997-2001 ................................................... 15

Table 7: State aid for horizontal objectives and particular sectors, 2001 .............................. 18

Graph 4:  Share of State aid directed to horizontal objectives, 1997-2001 ............................. 19

Table 8:  State aid to coal mining, 1997-2001 ........................................................................ 19

Table 9:  State aid specifically earmarked for assisted ‘a’ regions, 2001 ............................... 22

Graph 5:  State aid specifically earmarked for assisted ‘a’ regions, 1991-2001...................... 23

Graph 6:  Share of each aid instrument in total EU aid to manufacturing, 1999-2001............ 25

Table 10: State aid to the manufacturing sector by type of aid instrument, 1999-2001 .......... 26

Graph 7:  Share of negative decisions by Member State, 2000-2002...................................... 28

Table 11: Recovery orders pending in February 2003 ............................................................. 28

3

EXECUTIVE SUMMARY

The decision as to whether or not aid granted by Member States is compatible with the
Common Market  is  taken  by  the  Commission, in  accordance with the Treaty and  other
relevant  EU  legislation.  In  general  terms, State aid is only  approved  if  it  serves  clearly
defined  objectives,  such  as  research  and  development,  the  environment,  regional
development,  the  development  of  small  and  medium-sized  enterprises,  employment
creation,  the  promotion  of  training,  etc  and  if  undue  distortions  of  competition  are
avoided.  This  requires  a  balancing  of  the  objectives  and  effects  of  the  aid,  which  is
undertaken by the Commission in close co-operation with the Member State concerned.
This  process  works  rather  well.  Of  the  759  final  State  aid  decisions  taken  by  the
Commission in 2002, only 53 (7%) were negative decisions.

Indeed  the  system  of  State  aid  control  has  imposed  a  very  healthy  discipline  on  the
fifteen  Member  States,  each  of  whom  pledged  at  the  Stockholm  European  Council  to
reduce the overall amount of aid granted by 2003 and redirect aid to horizontal objectives
of common interest. Most are already on the right track with levels of aid falling steadily
and  aid  being  reoriented  to  objectives  such  as  the  environment  and  research  and
development. Nevertheless, the cumulative effect of some €86 billion of State aid in 2001
still has a considerable distortive effect on competition in the Internal Market.

Apart from the need to minimise distortion to competition, the grant of aid must also be
balanced  against  constraints on  national  public  finances  whilst  in  the  European  context
the grant of aid must be consistent with the framework of economic and monetary union
and  the  Stability  and  Growth  pact.  Public  resources  should  be  used  restrictively  and
efficiently. In this context, in November 2002 the Council adopted a set of Conclusions
on  “an  economic  approach  towards  less  and  better  State  aid”  The  main  aim  of  the
conclusions  is  to  develop  a  broader  economic  analysis  of  the  effects  of  State  aid  by
encouraging greater dialogue and exchange of information between the Member States. It
invites  Member  States  to  “…consider  before  granting  State  aid  …  whether  an
intervention in the form of State aid is the most appropriate and effective way to address
these issues (identified market failures)” and to continue to “develop the use of “ex-ante”
and  “ex-post”  evaluations  of  individual  State  aid  and  State  aid  schemes  in  order  to
monitor impact on competition and effectiveness of the aid”.

Main findings

Overall levels of State aid in the European Union have continued to fall

The overall  level of national  State  aid  in  the  EU  fell  from  €102  billion  in  1997  to  €86
billion in 2001. A significant fall in aid to assisted regions as well as reductions in aid for
financial  services,  coal,  agriculture  and  manufacturing  contributed  to  this  €16  billion
drop. In contrast with the overall downward trend, there was a substantial increase of aid
for transport and the environment. The two Member States that have contributed most to
the marked decrease are Germany (a fall of €6 billion) and Italy (a fall of €4 billion) due
largely to substantial reductions of aid to assisted regions.

4

Disparities between Member States in the resources allocated to national State aid
remain …

In relative terms, State aid amounted to 0.99% of EU Gross Domestic Product (GDP) in
2001. This average masks significant disparities between Member States: the share of aid
to  GDP  ranged  from  0.66%  in  the  United  Kingdom  to  1.58%  in  Finland.  The  high
proportion  in  Finland  can  be  explained  by  the  relatively  large  amount  of  aid  to
agriculture  which  represents  65%  of  total  aid  in  this  country.  Excluding  aid  to  the
agriculture,  fisheries  and  transport  sectors  produces  a  markedly  different  ranking  of
Member States. Such aid represents only 0.29% of GDP in Finland compared with an EU
average of 0.38%.

… but are diminishing as State aid as a percentage of GDP falls in the majority of
Member States

The level of State aid as a percentage of GDP decreased in twelve of the fifteen Member
States between 1997 and 2001, in line with the undertaking at Stockholm to demonstrate
a  reduction  in  State  aid  by  2003.  Greece,  Italy,  Portugal  and  Finland  experienced  the
sharpest falls (by 0.3 percentage points or more) between 1997-1999 and 1999-2001. In
contrast,  aid  in  relation  to  GDP  actually  increased  in  Denmark,  Luxembourg  and  the
Netherlands.  This  was  due  largely  to  a  rise  in  the  level  of  aid  granted  for  railway
transport although in the case of Denmark, there was a substantial increase in aid for two
horizontal objectives, employment and environment.

If aid for agriculture, fisheries and transport is excluded, total EU aid fell from 0.58% of
GDP on average for the period 1997-1999 to 0.43% for the period 1999-2001.

Sectoral  distribution  of  aid  varies  considerably  among  Member  States  and  over
time

It is not only the volume but also the composition of State aid that influences its impact
on  competition  in  the  Internal  market.  In  2001,  46%  of  State  aid  in  the  Union  was
granted to the transport sector, almost exclusively to  the  railway  network.  The share of
total  aid  directed  to  the  manufacturing  sector  was  25%,  agriculture  and  fisheries  15%
coal 7% and other aid 7%. There  are  significant differences  between Member States in
the  sectors  to  which  they  direct  aid.  Aid  to  the  agricultural  and  fisheries  sectors
accounted for only 9% of overall aid in Denmark and Germany while in Finland it was as
high as 65%. Aid to the railway sector made up more than 60% of total aid in Belgium,
Luxembourg and the Netherlands. Aid to the coal industry accounted for 18% of  aid in
Germany and 22% in Spain compared with a Community average of 7%.

State aid to manufacturing relative to value added fell in the majority of Member States
between  1997  and  2001.  EU-wide,  aid  granted  to  manufacturing  in  2001  amounted  to
around €21 billion or, put another way, 1.4% of value added in this sector.

Member States are redirecting aid to horizontal objectives

Looking at recent trends, the share of EU aid granted for horizontal objectives increased
by  10  percentage  points  from  the  period  1997-1999  to  1999-2001.  This  positive  trend
was observed, to varying degrees, in the majority of Member States.  At the same time,
most Member States have reduced their aid to specific manufacturing and service sectors.

5

In  2001,  aid  earmarked  for  horizontal  objectives,  including  cohesion  objectives,
accounted for 71% of total EU aid less agriculture, fisheries and transport. Around 19%
was reserved for the coal sector while the remaining 10% was aid for which the primary
objective was a specific manufacturing or service sector. The majority of Member States
directed between 75% and 100% of their aid to horizontal objectives although the choice
of objective varied substantially from one Member State to another.

Reduction in aid to the least developed regions

The  Stockholm  European  Council  in  2001  also  invited  Member  States  to  redirect  aid
toward  cohesion  objectives.  The  Commission  will,  insofar  as  is  possible  under  current
State aid control rules, continue to favour aid measures that aim to reduce the cohesion
gap. Greater cohesion will only be achieved however if  aid is concentrated on the least
developed  regions.  Its  effectiveness  must  not  be  compromised  by  the  granting  of
disproportionate State aid in non-assisted regions.

For  the  Union  as  a  whole  in  2001,  an  estimated  €8  billion  of  aid  was  earmarked
exclusively  for  the  least  developed  regions,  the  so-called  assisted  ‘a’  regions.  This
represented just under one quarter of total aid (less agriculture, fisheries  and transport).
Aid to the ‘a’ regions, which are almost identical to the Objective 1 regions under the EU
Structural Funds, has fallen dramatically over the last ten years or so, from a peak of €27
billion  in  1993  to  €8  billion  in  2001.  In  1993,  Germany  (€17  billion)  and  Italy  (€7
billion) made up almost 90% of the total. By 2001, these two Member States still made
up more than half the EU figure but the level of aid had declined rapidly to €2.5 billion in
Germany and €2.1 billion in Italy.

Majority  of  Member  States  tend  to  provide  aid  to  manufacturing  in  the  form  of
grants

As to the instruments used when aid is granted to the manufacturing sector, grants are by
far  the  most  frequently  used  form  making  up  63%  of  the  EU  total.  In  addition  to  aid
awarded through the budget, other aid is paid through the tax or social security system.
EU-wide,  tax  exemptions  make  up  26%  of  the  total.  While  Denmark,  Spain,
Luxembourg, Finland and the United Kingdom provide more than 85% of their aid in the
form  of  grants,  other  Member  States  make  greater  use  of  tax  exemptions,  particularly
Germany (36%), France (39%) and Ireland (77%).

The Commission approves the award of State aid in 93% of cases it examines

In 2002, there were around 1000 cases registered by the Commission. Around 44% were
in the manufacturing and service sectors, 38% in agriculture, 10% in fisheries and 8% in
transport and energy. According to the Treaty, Member States should notify all State aid
to  the  Commission.  However,  for  around  15%  of  investigated  aid  cases,  it  was  not  the
Member State but the Commission that had to initiate the control procedure after finding
out about the aid, for example following a complaint. During the period 1999-2001, 7%
of all final decisions taken by the Commission were negative ones.

6

The  Commission  continues  its  work  to  simplify,  modernise  and  reform  State  aid
control

The Commission  will  continue  with  its  State  aid  reform  process  to  accelerate,  simplify
and modernise procedures, in particular with a view to reducing the resources expended
on routine cases and concentrate on more important cases. Significant progress has been
achieved in simplifying and clarifying existing legislation by introducing for example the
new  multi-sectoral  framework  and  three  block  exemption  regulations  covering  aid  for
small and medium-sized enterprises, training and, more recently, employment. However,
further  efforts  are  needed  to  review  other  existing  State  aid  instruments  in  order  to
simplify and remove possible conflicts between the different texts.

7

INTRODUCTION

The decision as to whether or not aid granted by Member States is compatible with the
Common  Market  can  be  taken  only  by  a  supranational  and  independent  authority.  The
Commission's role, as set out in the Treaty, is to scrutinise proposed and existing state aid
measures  by  Member  States  to  ensure  that  they  are  compatible  with  EU  state  aid
legislation  and  do  not  distort  intra-community  competition.  Although  each  individual
grant  of  aid 
the  Commission  and
notwithstanding  the  positive  effects  that  aid  may  have  in  other  policy  areas,  the
cumulative effect of some €86 billion of State aid in 2001 has a considerable distortive
effect on competition in the Internal Market.

is  awarded  under  conditions  accepted  by 

Over the last ten years or so, the underlying trend in State aid, in terms of percentage of
GDP, has been downward for the vast majority of Member States. Nevertheless, the need
for  further  reductions  in  global  aid  levels  and  for  the  reorientation  of  aid  towards
horizontal  objectives  of  Community  interest,  including  cohesion  objectives,  has  been
underlined  by  the  Stockholm  European  Council  and  given  renewed  impetus  at  the
Brussels European Council in March 2003 which called for “a further reduction in state
aids and the redirection of aid to horizontal objectives” and welcomed “the Commission's
intention to continue working to simplify and modernise state aid arrangements, focusing
attention on the most distorting aid.” In November  2002,  the Council adopted  a further
set  of  Conclusions  on  “an  economic  approach  towards  less  and  better  State  aid”1.  The
Council thus  affirms the  Commission’s  view  that  less  and  better-targeted  State  aid  is  a
key part of effective competition. The Broad Economic Policy Guidelines for 2002 also
contain specific recommendations to Member States to this effect.

What is a State Aid ?

State aid is a  form of state intervention  used  to  promote a  certain  economic  activity.  It
implies that certain economic sectors or activities are treated more favourably than others
and  thus  distorts  competition  because  it  discriminates  between  companies  that  receive
assistance  and  others  that  do  not.  As  a  result,  it  presents  a  threat  to  the  running  of  the
internal market. The authors of  the  EC  Treaty  recognised  this  risk  and  set  up  a  system
which, while it is centred on the principle that State aid is incompatible with the common
market, nevertheless accepts that the granting of such aid can be justified in exceptional
circumstances. The basic rules of the system are outlined in Articles 87-88 of the Treaty.
These  rules  have  been  amplified  over  the  years  by  secondary  legislation  and  court
rulings.  For  more 
legal  and  procedural  framework,  see
http://europa.eu.int/comm/competition/state_aid/legislation/

information  on 

the 

The Scoreboard covers State aid as defined under Article 87(1) EC Treaty that is granted
by the fifteen Member States and has been examined by the Commission. Accordingly,
general  measures  are  not  included  in  the  figures.  For  example,  a  general  tax  break  for
expenditure on research and development is not considered as State aid although it may
well  appear  in  Member  States  national  budgets  as  public  support  for  research  and
development. Furthermore, Community funds and instruments are also excluded.

1 Council document number 13799/02: http://register.consilium.eu.int/pdf/en/02/st13/13799en2.pdf

8

                                                
Structure

The  Scoreboard  has  been  restructured  and  improved  so  as  to  make  better  use  of  the
possibilities offered by the internet. In addition to this paper edition, a permanent online
Scoreboard (http://europa.eu.int/comm/competition/state_aid/scoreboard/) consisting of a
series of key indicators, statistical information and a Member State Forum was launched in
2002.

The Scoreboard will continue to be updated twice a year, in the spring and in the autumn.
The main aim of the spring update is to provide an overview of the State aid situation in
the Union and to examine the underlying trends based on the latest  available data.  It  is
divided  into  three  parts.  The  first  part  looks  at  the  extent  to  which  Member  States  are
reducing  their  State  aid  relative  to  GDP.  The  second  part  focuses  on  Member  States’
relative  success  in  redirecting  aid  from  specific  sectors  to  horizontal  objectives  and
includes a special focus on aid specifically earmarked for assisted regions. Finally, part
three  looks  at  State  aid  control  procedures,  recovery  and  ongoing  work  to  modernise
State aid control.

Limitations

This edition of the Scoreboard focuses largely on 2001, the year in which the Stockholm
European Council took place. The following data restraints have to be considered when
the objectives set in Stockholm will be revisited in 2003. A full set of State aid data for
the year 2003 will only be available in early  2005 as  Member States, together  with  the
Commission, require up to one year to collect and analyse the data.

State aid data collected for the Scoreboard are grouped according to primary objectives.
The lack of  information on secondary  objectives  means that  aid  for  some  categories  of
aid may well be underestimated as they are classified elsewhere. For example, some aid
classified  under  ‘research  and  development’  may  also  be  aimed  at  ‘small  and  medium
size enterprises’ or it may be for a particular sector and so on. Furthermore, it should be
noted  that  the  data  do  not  provide  an  accurate  picture  of  the  final  beneficiaries.  For
example,  aid  granted  under  a  regional  development  scheme  may  end  up  going  to  a
variety of sectors or be destined largely for small and medium-sized enterprises, etc. The
Commission  is  currently  working  on  improving  the  detail  and  quality  of  the  data  it
collects.  It is hoped that  some  information on secondary  objectives will  be available  in
time  for  the  spring  Scoreboard  in  2004.  A  separate  exercise  will  attempt  to  provide  a
more  precise  measure  of  aid  for  rescue  and  restructuring.  At  present,  a  significant
proportion  of  the  aid  granted  for  financial  services,  for  example,  could  equally  be
classified as rescue and restructuring aid.

State aid Register - a second transparency tool

The Commission’s State aid Register has been online since 2001. The Register provides
detailed  information  on  all  State  aid  cases  for  which  a  decision  has  been  taken  by  the
Commission since 1st January 2000. It is updated daily and thus ensures that the public
has timely access to the most recent State aid decisions. It is available on the homepage
of the Competition Directorate General’s Internet site:

http://europa.eu.int/comm/competition/state_aid/register/

9

PART ONE: OVERVIEW OF STATE AID IN THE EUROPEAN UNION

This chapter provides a snapshot of State aid granted in the European Union in 2001 and
an overview of the underlying trends.

1.1

State aid in absolute and relative terms

State  aid  granted  by  the  fifteen  Member  States  was  estimated  at  €86  billion  in  2001,
compared with €102 billion in 19972. The two Member States that have contributed most
to the marked decrease are Germany (a fall of €6 billion) and Italy (a fall of €4 billion)
due largely to substantial reductions of aid to assisted regions.

In  absolute  terms,  Germany  granted  the  most  aid  (€23  billion)  in  2001  followed  by
France (€16 billion) and Italy (€12 billion).

Table 1:

State aid in the Member States, 2001

Total state aid in billion €

86,1 3,3 2,4 23,3 1,3 4,7 15,8 1,3 12,0 0,3 4,0 2,1 1,2 2,1 1,9 10,6

EU B DK D EL

E

F

IRL

I

L NL A

P FIN S UK

Total state aid less agriculture,
fisheries and transport in billion €

33,5 0,8 1,2 11,9 0,5 2,6 6,1 0,7 4,1 0,03 0,6 0,5 0,9 0,4 0,5 2,6

Total aid as % of GDP

0,99 1,34 1,36 1,14 1,02 0,74 1,10 1,20 1,01 1,30 0,98 0,99 1,04 1,58 0,71 0,66

Total aid less agriculture, fisheries 
and transport as % of GDP

Source: DG Competition

0,38 0,31 0,68 0,58 0,36 0,42 0,42 0,65 0,35 0,16 0,15 0,26 0,77 0,29 0,19 0,17

Disparities between Member States in the share of State aid as a percentage of GDP

In relative terms, State aid amounted to 0.99% of EU Gross Domestic Product (GDP) in
2001. This average masks significant disparities between Member States: the share of aid
to  GDP  ranges  from  0.66%  in  the  United  Kingdom  to  1.58%  in  Finland.  The  high
proportion  in  Finland  can  be  explained  by  the  relatively  large  amount  of  aid  to
agriculture which represents around 65% of total aid in this country. (Table 1).  Indeed,
due to the particularities associated with aid to agriculture, fisheries and transport, it also
makes sense to look at total aid less  these three sectors. This  new  indicator  produces  a
rather different ranking of  Member  States  (Graph  1).  For  example,  such  aid  in  Finland
represents  only  0.29%  of  GDP,  below  the  EU  average  of  0.38%.  Belgium  and
Luxembourg, which have relatively large amounts of aid to the railway sector, also find
themselves much lower down the ranking when aid to these three sectors is excluded.

2 All data are quoted at constant 2000 prices

10

                                                
Graph 1:

State aid as a percentage of GDP, 2001

To ta l a id

To ta l a id  le s s  a g r ic u ltu r e , f is h e r ie s  a n d  tr a n s p o r t

1 ,6

1 ,4

1 ,2

1 ,0

0 ,8

0 ,6

0 ,4

0 ,2

0 ,0

EU

B

DK

D

EL

E

F

IRL

I

L

NL

A

P

FIN

S

UK

State  aid  may  also  be  expressed  in  per  capita  terms,  using  purchasing  power  standards
which  take  account  of  differences  in  price  levels  between  countries.  Over  the  period
1999-2001, the annual average volume of aid (less agriculture, fisheries and transport) in
the  Union  was  97  PPS  per  capita  compared  with  123  PPS  over  the  period  1997-1999
(Table 2).

Table 2:

State aid per capita, 1997-2001

Total aid in PPS / Capita

Total aid less agriculture, fisheries and 
transport in PPS / Capita

EU
B
DK
D
EL
E
F
IRL
I
L
NL
A
P
FIN
S
UK

1997 - 1999
251
322
274
313
185
178
286
320
284
450
207
265
252
439
169
112

1999 - 2001
226
325
360
288
155
154
263
329
231
578
246
251
177
396
169
115

1997 - 1999
123
83
144
179
73
112
145
226
132
108
43
65
190
89
48
53

Data for Ireland cover the period 1998-1999 instead of 1997-1999.

Source: DG Competition

1999 - 2001
97
80
186
157
61
90
109
188
84
82
44
61
133
78
48
42

11

Downward trend in the level of State aid in the majority of Member States

At the Stockholm  European  Council  in  2001,  Member  States  pledged  to  demonstrate  a
downward  trend  in  State  aid  in  relation  to  GDP  by  2003.  The  underlying  trend  can  be
observed by comparing the periods 1997-1999 and  1999-2001. EU-wide,  aid amounted
to 1.01% of  GDP on average  for  the  period  1999-2001,  a  decrease  of  -0.16  percentage
points  compared  with  1997-1999.  The  trend  is  downward  in  twelve  of  the  fifteen
Member States. Greece, Italy, Portugal and Finland experienced the sharpest falls (of 0.3
points or more) between the two periods under review. In contrast, aid in relation to GDP
increased in Denmark, Luxembourg and the Netherlands. This was due largely to a rise
in the level of aid granted for  railway transport although  in the  case  of  Denmark, there
was  a  substantial  increase  in  aid  for  two  horizontal  objectives,  employment  and
environment.

Again,  it  is  interesting  to  look  at  the  trend  in  State  aid  less  agriculture,  fisheries  and
transport. For the Union as a whole, such aid fell from 0.58% of GDP on average for the
period 1997-1999 to 0.43% for the period 1999-2001 (Graph 2).

Graph 2:

State aid (less agriculture, fisheries and transport) as a percentage of
GDP, 1997 - 2001

1 997- 1999

19 99-20 01

1 ,4

1 ,2

1 ,0

0 ,8

0 ,6

0 ,4

0 ,2

0 ,0

EU

B

DK

D

EL

E

F

IRL

I

L

NL

A

P

FIN

S

UK

Data for Ireland cover the period 1998-1999 instead of 1997-1999.

Source: DG Competition

12

1.2

Sectoral distribution of aid

Sectoral  distribution  of  aid  varies  considerably  among  Member  States  and  over
time

As noted under ‘Limitations’, the available data do not provide an accurate picture of the
final  beneficiaries  of  the  aid.  Nevertheless,  they  do  give  some  indication  as  to  which
sectors are favoured by each Member State. In 2001, 46% of State aid in the Union was
specifically earmarked for the transport sector, almost exclusively to the railway network.
The  share  of  total  aid  directed  towards  the  manufacturing  sector  was  25%,  agriculture
and fisheries 15%, coal 7% and other aid 7%.

There  are  significant  differences  between  Member  States  in  the  sectors  to  which  they
direct aid. Aid to the agricultural and fisheries sectors accounted for only 9% of overall
aid in Denmark and Germany while in Finland it was as high as 65%. Aid to the railway
sector made up more than 60% of total aid in Belgium, Luxembourg, the Netherlands and
the  United  Kingdom  compared  with  an  EU  average  of  46%.  Aid  to  the  coal  industry
accounted for 18% of aid in Germany and 22% in Spain as against a Community average
of 7% (Table 3).

Table 3:

Sectoral distribution of aid, 2001

% of total

Manufacturing

EU
B
DK
D
EL
E
F
IRL
I
L
NL
A
P
FIN
S
UK

25
18
26
33
35
22
21
35
33
11
15
24
17
16
20
12

Services
(including tourism,
financial, media and
culture)
4
0
1
0
0
1
11
12
1
2
1
1
41
1
6
1

Transport

Agriculture 
& Fisheries

Coal

Million euro

Total

Not
elsewhere
classified *

46
66
41
40
46
28
40
27
56
74
62
31
2
17
51
64

15
11
9
9
18
16
21
18
10
13
22
42
25
65
21
11

7
-
-
18
-
22
6
-
-
-
-
-
-
-
-
1

3
5
23
0
-
11
0
7
1
-
0
1
16
1
1
11

86.114
3.330
2.369
23.274
1.306
4.659
15.844
1.301
11.999
273
3.992
2.056
1.225
2.074
1.863
10.550

* This column includes aid to other non-manufacturing sectors and aid for employment and training that
can not be classified under a particular sector.
Due to the rounding of figures, the percentages of some Member states do not sum up to exactly 100.
Source: DG Competition

Between 1997-1999 and 1999-2001, the volume of aid fell in most of the main sectors:
manufacturing was down €5.7 billion, services €2.6 billion, agriculture €0.9 billion and
coal  €1.2  billion  (Table  4).  However,  aid  for  transport  increased  by  some  €1.7  billion
over the same period.

13

At  national  level,  there  have  been  some  significant  fluctuations  in  the  share  of  aid
earmarked  for  each  sector  (Table  5).  The  share  of  aid  for  transport  rose  sharply  (by  at
least  10  percentage  points)  in  Italy,  Luxembourg,  the  Netherlands  and  the  United
Kingdom.  The  share  of  aid  to  the  manufacturing  sector  fell  in  the  vast  majority  of
Member States, particularly in Ireland and Italy. For the latter, this was due largely to a
reduction in aid for assisted regions as well as the increase in aid  for transport.  For  the
former, this was primarily the result of a cut in the Irish Corporation Tax3.

Table 4:

State aid by sector in the Community 1997-2001

O v e r a ll  n a t io n a l  a id
o f   w h ic h :
          A g r ic u lt u r e
          F is h e r ie s
          M a n u f a c t u r in g
          C o a l  m in in g
          T r a n s p o r t
          S e r v ic e s
          N o t   e ls e w h e r e   c la s s if ie d

A n n u a l  a v e r a g e
1 9 9 7   -   1 9 9 9
9 4 , 5

€   b illio n

A n n u a l   a v e r a g e
1 9 9 9   -   2 0 0 1
8 5 , 7

1 4 , 0
0 , 3
2 9 , 1
7 , 9
3 3 , 7
6 , 0
3 , 4

1 3 , 1
0 , 3
2 3 , 5
6 , 7
3 5 , 4
3 , 4
3 , 4

Table 5:

Share of State aid by sector in the Member States 1997-2001

Manufacturing

1997
-
1999

1999
-
2001

Services
(including
tourism, financial,
media and culture)

1997
-
1999

1999
-
2001

Transport

Agriculture
and Fisheries

Coal

Not elsewhere 
classified*

1997
-
1999

1999
-
2001

1997
-
1999

1999
-
2001

1997
-
1999

1999
-
2001

1997
-
1999

1999
-
2001

31

21

36

38

39

28

25

49

41

23

20

22

13

18

21

19

27

19

33

35

39

22

24

38

33

13

17

22

18

18

22

17

6

0

1

1

0

1

20

16

3

1

1

2

4

0

1

0

0

1

12

13

2

1

1

1

52

42

1

5

3

1

6

2

36

66

34

37

43

24

32

14

42

60

40

30

5

18

53

34

41

65

37

39

41

26

39

23

53

73

55

32

1

18

50

48

15

8

14

6

18

13

17

15

11

16

39

46

19

62

19

19

16

10

11

7

19

15

20

19

11

13

27

44

24

62

22

15

8

-

-

18

-

20

5

-

-

-

-

-

-

-

-

9

8

-

-

18

-

21

6

-

-

-

-

-

-

-

-

1

4

4

15

1

-

14

0

5

2

-

0

1

11

2

2

17

4

5

18

1

-

15

0

6

2

-

0

1

15

1

1

17

EU

B

DK

D

EL

E

F

IRL

I

L

NL

A

P

FIN

S

UK

* This column includes aid to other non-manufacturing sectors and aid for employment and training that
can  not  be  classified  under  a  particular  sector.  Due  to  the  rounding  of  figures,  the  percentages  of  some
Member states do not sum up to exactly 100. Data for Ireland cover the period 1998-1999 instead of 1997-
1999.
Source: DG Competition

3 The rate of corporation tax in Ireland has been cut progressively in recent years and is 12.5% from 2003.
This has reduced the comparative value of the preferential 10% rate to the manufacturing sector, therefore
contributing to the decline, in monetary terms, of aid to this sector.

14

                                                
State aid to the manufacturing sector

1.3
The following section focuses on aid to the manufacturing sector4. This is one sector in
which  some  Member  States  could  potentially  look  at  in  order  to  comply  with  the
Stockholm request to reduce State aid levels. EU-wide, aid granted to manufacturing in
2001 amounted  to around €21 billion or, put  another  way,  1.4%  of  value  added  in  this
sector (Table 6).

Table 6:

State aid to the manufacturing sector, 2001

State aid to the
manufacturing sector
in million €*

State aid to the
manufacturing sector
as % of value added

EU

B

DK

D

EL

E

F

IRL

I

L

NL

A

P

FIN

S

UK

21.287

604

604

7.577

462

1.041 3.305

459

3.905

29

595

497

203

335

380

1.290

1,4

1,4

2,3

1,8

3,7

1,1

1,3

1,5

1,7

1,2

1,0

1,2

1,1

1,1

0,7

0,5

Note: Data on manufacturing include aid for general regional development for which the specific sector is
not  known.  For  some  Member  States,  particularly  Greece  with  a  large  share  of  aid  awarded  through
regional development schemes, the data are likely to overestimate the amount of aid actually going to the
manufacturing sector.

Source: DG Competition

State aid to manufacturing relative to value added fell in the majority of Member States
between  1997-1999  and  1999-2001  (Graph  3).  This  was  particularly  the  case  in  Italy,
where  the  long-term  downward  trend  has  continued,  but  Greece,  Germany,  Spain  and
Ireland also saw a significant drop in manufacturing aid.

Graph 3:

State aid to the manufacturing sector, 1997-2001

1 9 9 7  - 1 9 9 9

1 9 9 9  - 2 0 0 1

d
e
d
d
a

e
u
l
a
v
f
o
e
g
a
t
n
e
c
r
e
p
s
a

5 ,0

4 ,5

4 ,0

3 ,5

3 ,0

2 ,5

2 ,0

1 ,5

1 ,0

0 ,5

0 ,0

E U

B

D K

D

E L

E

F

IR L

I

L

N L

A

P

F IN

S

U K

Source: DG Competition

4 For the purposes of the Scoreboard, the  manufacturing sector includes aid  for steel, shipbuilding,  other
manufacturing  sectors,  rescue  and  restructuring,  aid  for  general  economic  development  and  aid  for  most
horizontal  objectives  including  research  and  development,  SMEs,  environment,  commerce  and  energy
saving.

15

 
 
 
 
                                                
PART TWO: ADOPTING  AN  ECONOMIC  APPROACH  TOWARDS  LESS  AND  BETTER  STATE
AID

In  March  2000,  the  Lisbon  European  Council  set  out  to  make  the  EU  the  most
competitive  and  dynamic  knowledge-based  economy  in  the  world.  The  Council,
Commission  and  Member  States  were  requested  “to  further  their  efforts  to  promote
competition and reduce the general level of State aids”. One year later at the Stockholm
European  Council,  Member  States  pledged  to  “demonstrate  a  downward  trend  in  State
aid  in  relation  to  GDP  by  2003,  taking  into  account  the  need  to  redirect  aid  toward
horizontal  objectives  of  common  interest,  including  cohesion  objectives.”  Further
impetus was provided at the Barcelona European Council in March 2002 when Member
States  agreed  to  step  up  their  efforts  to  reduce  aid  levels.  In  March  2003,  the  Brussels
European Council called for “a further reduction in state aids and the redirection of aid to
horizontal  objectives  and  welcomes  the  Commission's  intention  to  continue  working  to
simplify and modernise state aid arrangements, focusing attention on the most distorting
aid”.

In addition to the references to State aid at the European Council summits, more specific
conclusions on State aid have also been adopted. In December 2001, the Council adopted
a set of conclusions in which it invited Member States to continue their efforts to reduce
aid levels, reorient aid towards horizontal objectives, further develop the use of "ex ante"
and "ex post" evaluations of aid schemes, and improve the transparency and the quality
of  reporting  to  the  Commission.  The  Council  also  asked  the  Commission  to  take  an
active  role  in  following-up  the  implementation  of  these  conclusions  and  to  present  an
initial assessment of progress in 20025.

In  November  2002,  the  Council  adopted  a  further  set  of  conclusions  on  “an  economic
approach  towards  less  and  better  State  aid”6  The  main  aim  of  the  conclusions  is  to
develop a broader  economic  analysis  of  the  effects  of  State  aid  by  encouraging  greater
dialogue and exchange of information between the Member States. It reaffirms the need
to “closely evaluate State aid in order to identify and reduce the most distortive types of
State  aid,  underlining  that  monitoring  and  follow-up  of  State  aid  expenditures  are
essential  components  of  State  aid  policies  in  Member  States  and  Community  State  aid
policy;” In this context, it invites Member States  to “consider before  granting  State  aid
whether  it  is  targeted  on  clearly  identified  market  failures  or  directed  at  horizontal
objectives  of  common  interest,  including  economic  and  social  cohesion  objectives,  and
whether an intervention in the form of State aid is the most appropriate and effective way
to address these issues;” and to continue to “develop the use of “ex-ante” and “ex-post”
evaluations of individual State aid and State aid schemes in order to monitor impact on
competition and effectiveness of the aid”. The Commission should play a facilitating role
in this  process by,  for example, exchanging  experiences,  notably  through  meetings  and
seminars, on their efforts to reduce State aid and by developing a web-based network for
the  exchange  of  information  and  experience  between  Member  States  and  the

5 The Commission’s progress report to the Council (COM(2002) 555 final) concerning the reduction and
reorientation of State aid was adopted on 16th October 2002:
http://europa.eu.int/comm/competition/state_aid/others/
6 Council document number 13799/02: http://register.consilium.eu.int/pdf/en/02/st13/13799en2.pdf

16

                                                
Commission,  and  continue  to  increase  transparency.  The  Conclusions  also  call  on  the
Commission, in close co-operation with the Member States, to “continue to modernise,
simplify,  and  clarify  the  scope  and  content  of  EU  rules  on  State  aid,  including  making
them  more  effective  in  terms  of  the  length  of  process  and  the  administrative  resources
involved.”

2.1

Horizontal and sectoral objectives

Member States are redirecting aid to horizontal objectives

State aid for horizontal objectives, i.e. aid that is not granted to specific sectors, is usually
considered as being targeted to market failures and as being less distortive than sectoral
and ad hoc aid. Research and development, safeguarding the environment, energy saving,
support to  small  and  medium-sized  enterprises,  employment  creation,  the  promotion  of
training  and  aid for  regional  development  are  the  most  prominent  horizontal  objectives
pursued with State aid. Due to data constraints, this section looks at horizontal objectives
in the context of total aid less agriculture, fisheries and transport.

In contrast, aid to support specific sectors is likely to distort competition more than aid
for horizontal objectives and also tends to favour other objectives than identified market
failures.  Moreover,  a  significant  part  of  such  aid  is  granted  to  rescue  or  restructure
companies in difficulty. This particular type of aid will be examined in greater detail in
the next edition of the Scoreboard.

In  2001,  aid  earmarked  for  horizontal  objectives,  including  cohesion  objectives,
accounted for 71% of total EU aid less agriculture, fisheries and transport. Around 19%
was reserved for the coal sector while the remaining 10% was aid for which the primary
objective was a specific manufacturing or service sector. The majority of Member States
directed  between  75%  and  100%  of  their  aid  to  horizontal  objectives.  However,  in
Germany  (63%),  Spain  (55%),  France  (53%)  and  Portugal  (41%),  the  share  was
significantly lower. The high share of sectoral aid in Portugal was due largely to a single
regional  aid  tax  scheme  in  Madeira  that  mainly  supports  financial  services.  The  other
three  Member  States  have  relatively  high  shares  of  aid  to  the  coal  sector  (see  Section
2.2).

When making comparisons between Member States, it is important to bear in mind that
aid schemes are classified according to the primary objective. As a result, the level of aid
for  some  categories  may  well  be  underestimated  as  they  are  classified  elsewhere.  For
example,  some  aid  classified  under  ‘research  and  development’  may  also  be  aimed  at
‘small and medium size enterprises’.  Notwithstanding  the  measurement  difficulties,  the
data  do  give  an  indication  as  to  which  horizontal  objectives  are  favoured  by  each
Member State. For example, around 40% of aid in Austria  and Finland was directed to
research and development (EU average of 13%). Denmark (32% of total aid), Germany
(27%) and Sweden (33%) tended to favour environmental objectives while in Italy 61%
of aid was earmarked for small and medium-sized enterprises (EU average of 16%). The
United Kingdom devoted 42% of its total aid (less agriculture, fisheries and transport) to
training  objectives  (EU  average  of  6%).  This  aid  was  awarded  almost  exclusively  for
youth training.

17

Table 7:

State aid for horizontal objectives and particular sectors, 2001

EU

B

DK

D

EL

E

F

IRL

I

L

NL

A

P

FIN

S

UK

Percentage of total aid less agriculture, fisheries and transport

Horizontal Objectives
     Research and Development
     Environment
     SME
     Commerce
     Energy saving
     Employment aid
     Training aid
     Other Objectives (1)

Particular sectors
     Shipbuilding
     Other Manufacturing Sectors (2)
     Other Non-manufacturing Sectors
     Coal
     Tourism
     Financial Services
     Media, Cultural sector & services

71
13
13
16
1
2
3
6
18

29
0
1
0
19
1
5
3

99
20
4
18
0
0
19
3
35

1
-
0
-
-
1
-
0

97
7
32
2
0
10
25
21
1

3
-
0
-
-
-
-
3

63
13
27
4
0
1
1
0
18

37
0
1
-
35
1
0
0

99
2
1
7
-
-
-
-
90

1
-
0
-
-
-
-
1

55
11
1
8
0
0
5
15
16

45
1
3
0
39
0
-
1

53
14
2
21
2
1
1
-
12

47
-
3
0
16
-
25
4

78
3
-
1
0
0
10
3
61

22
-
1
0
-
3
15
4

96
17
1
59
0
0
1
0
17

4
-
1
0
-
3
-
0

Total aid less agriculture, fisheries and 
transport in million €

33.463

778 1.180 11.853

465 2.623 6.105

706 4.120

87
22
2
31
1
-
-
-
31

13
-
0
-
-
-
-
13

33

94
40
14
14
-
1
5
-
20

6
-
2
-
-
4
-

90
28
17
6
4
28
0
-
8

10
5
0
-
-
-
-
5

41
3
-
10
0
0
8
14
7

59
-
3
-
-
2
1
53

97
41
1
12
5
18
7
0
13

3
-
0
-
-
-
-
3

78
13
33
12
-
13
-
3
4

22
-
0
-
-
-
-
22

91
11
6
12
0
0
-
42
20

9
0
0
-
4
1
-
5

629

547

902

376

506 2.639

(1) Includes aid for general regional development not elsewhere classified.
(2) Includes aid for the steel sector as well as aid for rescue and restructuring not elsewhere classified.
Source: DG Competition

In  line  with  the  commitments  undertaken  at  the  above-mentioned  European  Councils,
Member  States  have  continued  to  redirect  aid  towards  such  horizontal  objectives  of
Community interest. Looking at recent trends, the share of EU aid granted for horizontal
objectives  increased  by  10  percentage  points  from  the  period  1997-1999  to  1999-2001
(Graph 4). This was largely the result of a sharp increase (+8 points over this period) in
aid for environmental objectives.

The positive trend was observed, to varying degrees, in the majority of Member States. In
Germany,  Spain,  France,  Portugal  and  the  United  Kingdom,  the  share  of  horizontal
objectives increased by at least 10 percentage points over this period.

EU-wide, the share of aid  granted for research and development  (R&D) increased by 3
percentage points from the period 1997-1999 to 1999-2001.  In  Italy, the  share  of R&D
aid rose by 10 percentage points. This may be seen in the context of the target set by the
Barcelona  European  Council  that  overall  spending  on  R&D  in  the  Union  should  be
increased  with  the  aim  of  approaching  3%  of  GDP  by  2010,  with  two-thirds  of  this
investment coming from the private sector.

18

Graph 4:

Share of State aid directed to horizontal objectives, 1997-2001

1997 - 1999

1999 - 2001

100

90

80

70

60

50

40

30

20

10

0

EU

B

DK

D

EL

E

F

IRL

I

L

NL

A

P

FIN

S

UK

Source: DG Competition

2.2

Coal and Steel

As regards the coal and steel sectors, the Commission adopted a Communication in 2002
clarifying  certain  aspects  of  the  treatment  of  competition  cases  and  the  application  of
State  aid  procedures  following  the  expiry  of  the  ECSC  Treaty  in  July  20027.  The
Commission also adopted a Regulation which lays down  rules for the  granting of State
aid to the coal industry with the aim of contributing to the restructuring of this sector8.

State aid to the steel sector has dropped considerably over the last few years from around
€330  million  in  1997  to  just  over  €30  million  in  2001.  More  than  90%  of  aid  to  this
sector is awarded for environmental purposes and classified as such.

In the case of coal, some €6.2 billion was granted to the  sector  in  2001.  Aid  to current
production  has  continued  to  decrease  steadily  in  line  with  the  agreements  on  the
reduction of volumes of aid to the coal industry until 2005. Table 8 provides an overview
of aid to the coal industry over the period 1997 - 2001.

Table 8:

State aid to coal mining, 1997-2001

Yearly average of aid not 
destined to current production
(in million €)

Yearly average of aid destined to current production

1997 - 1999

1999 - 2001

EU
D
E
F
UK

1997 - 1999
2.175,8
441,6
392,9
621,7
719,7

1999 - 2001

1.982,8
951,4
401,8
629,6

-

in million €
5.693,5
4.540,7
776,0
376,9

-

€ per employee

49.024
62.977
37.415
35.560
-

in million €
4.672,8
3.541,6
683,5
363,6
84,0

€ per employee

49.004
60.922
40.654
43.094
7.021

Source: DG Competition

7 OJ C 152, 26.06.2002, p.5
8 Council Regulation (EC) No 1407/2002 of 23 July 2002 on State aid to the coal industry

19

                                                
2.3

State aid supporting regional development and cohesion

Introduction

The  Stockholm  European  Council  in  2001  called  on  the  Member  States  to  redirect  aid
toward  horizontal  objectives  of  common  interest,  including  cohesion  objectives.  This
implies  an  increase  in  aid  in  support  of  economic  and  social  cohesion.  However,  the
decision to grant aid for regional development can only be taken if the balance between
the  resulting  distortions  of  competition  and  the  advantages  of  the  aid  in  terms  of  the
development of a less favoured region can be guaranteed. Furthermore, to achieve greater
cohesion  it  is  essential  that  aid  is  concentrated  on  the  least  developed  regions.  Its
effectiveness must not be compromised by the  granting  of disproportionate  State  aid  in
non-assisted regions.

Measuring the extent of financial support for the EU’s regions is a particularly difficult
task. Firstly,  each Member State has its own  regional policy  and  will devote  part  of its
national  budget,  other  than  ‘State  aid’,  to  regional  development.  Moreover,  in  Member
States with a federal structure such as Germany, regional governments (the Länder) are
responsible  for  significant  areas  of  expenditure.  In  other  Member  States,  there  is  an
increasing  tendency  towards  devolving  power  to  regional  and  local  governments.  Then
there are the EU Structural Funds  financing multi-annual programmes which are drawn
up in a partnership associating the regions, the Member States and the Commission. Such
funding is excluded from the Scoreboard but it does impact on  the  amount of State  aid
earmarked  for  regions  insofar  as  much  Community  funding  is  co-financed  by  national
funding9.

In addition, each Member State targets part of its State aid towards the least developed
regions, the so-called ‘assisted regions’ (see box). In practice, an aid scheme may either
be specifically earmarked for an assisted region (or group of ‘a’ or ‘c’ assisted regions) or
else  be  a  nation-wide  scheme10.  Clearly,  assisted  regions  will  also  benefit  from  aid
granted through nation-wide schemes but, in the absence of data on the final beneficiaries
of  the  aid,  this  is  not  possible  to  quantify.  As  a  second  best  solution,  it  is  however
possible  to  measure  all  aid  specifically  earmarked  in  an  aid  scheme  for  ‘a’  assisted
regions regardless of the overall objective of the aid11.

9 It should be noted that a sizeable proportion of such national funding does not qualify as ‘State aid’ as it
involves expenditure on infrastructure, etc.
10 A third category exists whereby aid is awarded by regional authorities to regions which don’t qualify for
any form of assistance at NUTS II level but the overall amount of aid is not significant at the Community
level.
11  In  previous  Scoreboards,  data  on  ‘regional  aid’  included  only  aid  where  the  primary  objective  was
deemed  to  be  ‘regional’  and  therefore  excluded  aid  granted  to  a  specific  region(s)  but  for  which  the
primary objective was, say, small and medium-sized enterprises or research and development.

20

                                                
Defining the assisted regions

Under  Article  87(3)  of  the  Treaty,  certain  areas  (regions)  may  be  given  a  derogation  from  the
incompatibility principle established by Article 87(1). Firstly, Article 87(3)(a) provides that aid
“to promote the economic development of areas where the standard of living is abnormally low
or  where  there  is  serious  underemployment”  may  be  considered  compatible  with  the  common
market. The ‘a’ regions are largely identical to the Objective 1 regions under the EU Structural
Funds. In practice, a region qualifies for ‘a’ status if, being a NUTS12 level II geographical unit,
it has a per capita GDP of less than 75% of the EU average. Annex 1 provides a full list of ‘a’
regions approved for the period 2000-2006.

Secondly, aid may be considered compatible with the common market under Article 87(3)(c) if it
is  to  “facilitate  the  development  of  certain  economic  activities  or  of  certain  economic  areas,
where such aid does not adversely affect trading conditions to an extent contrary to the common
interest.” Article 87(3)(c) allows greater latitude than Article 87(3)(a) when it comes to defining
the difficulties of a region that can be alleviated with the help of aid measures. However, as it is
intended for  regions  which  are less  disadvantaged  than  those to  which  point  (a)  relates,  only  a
small  part  of  the  national  territory  of  a  Member  State  may  prima  facie  qualify  for  the  aid  in
question.

According to the Guidelines on national regional aid  (full text  of 98/C  74/06  can be  found  on:
http://europa.eu.int/comm/competition/state_aid/legislation/),  the  Commission  considers  prima
facie that the total extent of assisted regions in the Community must remain smaller than that of
unassisted  regions.  In  practice  this  means  that  the  total  coverage  of  regional  aid  in  the
Community must be less than 50% of the Community population. For the period 2000-2006, the
Commission set the Community ceiling for regional aid at 42,7% of the Community's population.
The national ceilings for each Member State are as follows:

Belgium: 
30.9%
Denmark: 
17.1%
Germany:
34.9%
Greece: 
100%
Spain: 
79.2%
France: 
36.7%
Ireland: 
100%
Italy: 
43.6%
Luxembourg: 
32%
Netherlands: 
15%
Austria: 
27.5%
Portugal: 
100%
Finland: 
42.2%
15.9%
Sweden: 
United Kingdom: 28.7%

The regions of a Member State eligible under the derogations and the ceilings on the intensity of
aid  for  initial  investment  or  the  aid  for  job  creation  approved  for  each  region  together  form  a
Member  State's  regional  aid  map  (http://europa.eu.int/comm/competition/state_aid/regional/).
The  guidelines  also  define  the  areas  where  an  additional  regional  bonus,  in  terms  of  aid
intensities,  may  be  awarded  under  horizontal  policies  such  as  for  small  and  medium-sized
enterprises.

12 NUTS is the Nomenclature of territorial units for statistics.
http://europa.eu.int/comm/eurostat/ramon/nuts/home_regions_en.html

21

                                                
State aid specifically earmarked for assisted regions

State aid data are not available below NUTS level II. This does not pose  any problems
when  measuring  State  aid  given  to  assisted  regions  under  Article  87(3)a  as  all  such
regions are defined at NUTS level I or II. However under Article 87(3)c, often only part
of a NUTS level  II region is considered eligible. As a result, there are  two  types of  ‘c’
area: one where the NUTS level II region is ‘totally’ assisted, the other where the region
is only ‘partly’ assisted. For example, in Germany, Berlin is a totally assisted ‘c’ region
while  Bayern  is  a  partly  assisted  ‘c’  region.  In  2001,  2.5%  of  total  EU  aid  (less
agriculture, fisheries and transport for which a regional breakdown is not available) was
reserved for totally assisted ‘c’ regions. In addition, a further 13% of aid was earmarked
for partly assisted ‘c’ regions at NUTS level II. Unfortunately, in the absence of data on
the  beneficiaries  at  NUTS  level  III  or  below,  it  is  not  possible  to  determine  what
proportion  of  this  aid  actually  went  to  the  assisted  part  of  the  region.  Consequently,
figures for aid to assisted ‘c’ regions are not comparable between Member States.

For the Union as a whole, an estimated €8 billion of aid was earmarked exclusively for
assisted  ‘a’  regions  in  2001.  This  represented  just  under  one  quarter  of  total  aid  (less
agriculture, fisheries and transport for which a regional breakdown is not available).

Table 9:

State aid specifically earmarked for assisted ‘a’ regions, 2001

EU

B DK

D

EL

E

F

IRL

I

L NL A

P* FIN S UK

Total aid less agriculture, fisheries and 
transport, mio €
Aid for assisted 'a' regions, mio €
Aid for assisted 'a' regions as a percentage 
of total aid**

33463 778 1180 11853 465 2623 6105 706 4120

33 629 547 902 376 506 2639

8017

24

-

-

-

-

2536

465

697

348

648 2116

21 100

27

6

92

51

-

-

-

-

16

902

3 100

-

-

-

-

288

11

Note: There are no assisted ‘a’ regions in B, DK, L, NL and S.
* In 2000, Lisboa and Vale do Tejo changed from ‘a’ to ‘c’ status. Data are not yet available on specific aid
schemes to this region so all aid is still classified under assisted ‘a’ regions.
** Data exclude agriculture, fisheries and transport for which a regional breakdown is not available. It is
therefore  not  possible  to  measure  aid  to  assisted  ‘a’  regions  as  a  proportion  of  total  State  aid.
Source: DG Competition

Disparities  between  the  Member  States  in  the  levels  of  aid  reserved  for  assisted  ‘a’
regions (Table 9) reflect not only differences in regional policy but also the size of each
country’s eligible population as well as the extent to which each Member State grants aid
at a sub-central level.  For the  cohesion countries, some  aid  schemes  are  not  earmarked
for a specific region but, as the entire territory qualifies for assistance at either ‘a’ or ‘c’
level13, the aid is in effect reserved for assisted regions.

13 For Greece, the entire country is an ‘a’ assisted area. For Ireland and Portugal, 100% of the population is
eligible but part of the country is a ‘c’ assisted area. In Spain, 80% of the population is eligible for a) or c)
aid but at NUTS level II, the entire territory is either totally or partly assisted.

22

                                                
Aid to the ‘a’ regions, which are almost identical to the Objective 1 regions under the EU
Structural Funds, has fallen dramatically over the last ten years or so, from a peak of €27
billion  in  1993  to  €8  billion  in  2001.  In  1993,  Germany  (€17  billion)  and  Italy  (€7
billion) made up almost 90% of the total. For the former, this was part of the enormous
investment made in the new  German  Länder during most of the 1990s.  By  2001,  these
two Member States still made up more than half the EU figure but the level of  aid had
declined rapidly to €2.5 billion in Germany and €2.1 billion in Italy.

In spite of  the  reduction, aid to  the ‘a’  regions  continued  to  account  for  around  half  of
Italy’s total aid in 2001. In contrast, German aid to the ‘a’ regions made up 21% of total
aid  in  2001  compared  with  more  than  50%  in  1993.  EU-wide,  the  corresponding
percentage  has  fallen  from  around  45%  of  total  aid  in  1993  to  23%  in  2001.  Graph  5
shows the trend for EU-15 and these two Member States.

Graph 5:

State aid specifically earmarked for assisted ‘a’ regions, 1991-2001

n
b
€

3 0

2 5

2 0

1 5

1 0

5

0

19 9 1

19 9 2

19 9 3

19 9 4

19 9 5

19 9 6

19 9 7

19 9 8

19 9 9

2 0 0 0

2 0 0 1

E U - 1 5

G e r m a n y

It a ly

New Multisectoral Framework for regional investment aid

In February 2002 the Commission adopted a major reform to establish a faster, simpler
and more accountable control system of government support to large investments in the
EU.  The  new  “Multisectoral  Framework  on  regional  aid  for  large  investment  projects”
will enter fully into force on 1 January 2004 and replaces the current framework that has
been  in  force  since  September  1998.  It  includes  a  limited  notification  requirement  for
large projects balanced by a significant reduction in allowable aid levels. The new rules
will also apply to the synthetic fibres industry  and the motor vehicles  sector,  for which
separate rules existed.

The need for a restrictive approach on regional aid to large-scale and mobile investment
projects (i.e. projects which the company concerned could carry out in various locations)
is widely acknowledged:

23

 
–  the  distorting  effect  of  such  aid  is  magnified  as  other  government-induced
distortions of competition are eliminated and markets become more open and
integrated;

–  large 

investments  are 

less  affected  by  region-specific  problems 

in

disadvantaged areas;

–  moreover, companies making large investments usually possess considerable
bargaining power vis à vis the authorities granting the aid, which may lead to
a  spiral  of  increasingly  generous  promises  of  aid,  possibly  to  a  level  much
higher than is needed to compensate for the respective regional handicaps.

According to the new framework, the actual aid intensity that a large project can receive
corresponds  to  the  aid  ceiling  laid  down  in  the  Regional  aid  maps,  which  is  then
automatically reduced in accordance with a reduction scale. A ‘cohesion  bonus’  can be
granted  to  very  large  projects  co-financed  by  the  Community  Structural  funds.  In  so
doing,  the  new  system  will  take  into  consideration  the  added  value  of  these  large  co-
financed projects for the economic and social cohesion of the Community.

The  Framework  also  foresees  a  ‘list  of  sectors  suffering  from  structural  problems’.  No
regional aid for investment projects in these sectors will be authorised above a threshold
to  be  determined  by  the  Commission,  unless  the  Member  State  demonstrates  that,
although the sector is deemed to be in decline, the market for the product concerned is
fast  growing  (typically  the  production  of  a  certain  product  is  only  one  of  the  activities
carried out in a sector).

The new Framework will be fully applicable as from 1 January 2004 until 31 December
2009.  There  are  some  transition  rules  for  projects  in  the  synthetic  fibres  and  motor
vehicle sectors.

Regional aid post-2006

The  current  regional  aid  maps  for  the  fifteen  Member  States  will  remain  in  place  until
2006. Regional aid maps for the candidate countries have been, or are in the process of
being, elaborated. For the period after 2006, a fundamental review of regional aid will be
undertaken.

2.4

State aid instruments

Majority  of  Member  States  tend  to  provide  aid  to  manufacturing  in  the  form  of
grants …

All State aid represents a cost or a loss of revenue to the public authorities and a benefit
to  recipients.  However,  the  actual  aid  element  may  differ  from  the  nominal  amount
transferred in the case of a subsidised loan or guarantee.

24

Graph 6:

Share of each aid instrument in total EU aid to manufacturing, 1999-2001

Tax deferrals
0,5%

Guarantees
3,1%

Soft loans
6,6%

Equity participations
0,3%

Tax exemptions
26,1%

Grants
63,3%

Source: DG Competition

… though significant differences still exist in the use of instruments

For the period 1999-2001, grants accounted for 63% of all State aid in the manufacturing
sector. In addition to aid awarded through the budget, other aid is paid through the tax or
social  security  system.  EU-wide,  tax  exemptions  make  up  26%  of  the  total.  While
Denmark, Spain, Luxembourg, Finland and the United Kingdom provide more than 85%
of  their  aid  in  the  form  of  grants,  other  Member  States  make  greater  use  of  tax
exemptions,  particularly  Germany  (36%),  France  (39%)  and  Ireland  (77%).  A  similar
instrument  is  a  tax  deferral  which  is  used  by  only  four  Member  States.  Tax  deferrals
account for 5% of all manufacturing aid in the Netherlands.

There are other forms of aid instrument which vary  from one Member State to another
(Table  10).  One  such  category  covers  transfers  in  which  the  aid  element  is  the  interest
saved  by  the  recipient  during  the  period  for  which  the  capital  transferred  is  at  his
disposal.  The  financial  transfer  takes  the  form  of  a  soft  loan  or  tax  deferral.  The  aid
elements  in  this  category  are  much  lower  than  the  capital  values  of  the  transfers.  EU-
wide, soft loans represent around 7% of all manufacturing aid. In Spain, France, Austria,
and Sweden the proportion is significantly higher (around 10%-12%).

25

Aid may also be in the form of state equity participation which represents less than 1% of
all  EU  aid  to  the  manufacturing  sector.  Finally,  aid  may  be  provided  in  the  form  of
guarantees. The aid elements are much lower than the nominal amounts guaranteed, since
they correspond to the benefit which the recipient receives free of charge or at lower than
market rate if a premium is paid to cover the risk. Guarantees were awarded in 2001 by
most Member States although the aid made up only 3% of total EU aid manufacturing.

Table 10: State aid to the manufacturing sector by type of aid instrument, 1999-2001

Grants

63,3
78,7
86,7
49,9
81,2
88,1
47,1
18,9
77,9
94,3
78,1
82,2
78,3
93,8
73,8
96,2

Tax 
exemptions
26,1
14,9
10,0
35,8
18,7
-
38,7
76,8
17,5
-
8,7
-
11,0
1,5
14,2
2,6

EU
B
DK
D
EL
E
F
IRL
I
L
NL
A
P
FIN
S
UK

TYPE OF AID
Equity 
participations
0,3
0,2
-
0,2
-
0,7
-
4,3
0,3
-
-
0,1
0,9
-
1,0
1,1

Soft loans

6,6
5,5
2,5
7,2
0,0
11,1
10,4
-
4,1
5,7
5,8
12,3
8,5
4,6
10,8
0,1

Tax 
deferrals
0,5
0,3
-
0,9
-
-
0,3
-
-
-
4,9
-
-
-
-
-

per cent

Guarantees

3,1
0,4
0,9
6,1
0,1
0,1
3,5
0,0
0,3
-
2,5
5,4
1,4
0,1
0,2
-

26

PART THREE: PROCEDURAL PERFORMANCE IN THE EUROPEAN UNION

3.1

Registered aid cases

The Commission controls the Member States’ granting of State aid by means of a formal
and transparent procedure (Council regulation No 659/1999). In 2002, there were around
1000 cases registered by the  Commission.  Around 44%  were in  the  manufacturing  and
service sectors, 38% in agriculture, 10% in fisheries and 8% in transport and energy.

According to the Council regulation, “any plans to grant new aid shall be notified to the
Commission  in  sufficient  time  by  the  Member  State  concerned.”  However,  for  around
15% of investigated aid cases, it was not the Member State but the Commission that had
to initiate the control procedure after finding out about the aid, for example following a
complaint.

With  a  view  to  reducing  the  administrative  burden  for  specific  types  of  aid,  two  block
exemptions, one for small and medium-sized enterprises, the other for training aid came
into force in February 2001. As one would expect, the number of notifications for these
two types of aid fell in 2002 as some Member States made use of the block exemptions:
the Commission received 102 information forms on exempted training aid and 128 forms
on exempted aid for SMEs. Four Member States, Germany, Spain, Italy and the  United
Kingdom accounted for 95% of the information sheets while most other Member States
have not made use of the possibilities offered.

3.2

Commission Decisions

In  the  vast  majority  of  cases,  the  Commission  concludes  that  the  examined  aid  is
compatible with the State aid rules and allows Member States to award such aid without
carrying  out  a  formal  investigation  procedure.  This  was  the  case  for  87%  of  decisions
taken in 2002. Where the Commission has doubts whether certain aid measures comply
with  the  rules,  it  carries  out  a  formal  investigation  during  which  third  parties  and  all
Member States are invited to provide observations. At the end of the formal investigation
procedure,  the  Commission  either  takes  a  positive  or  conditional  decision  (6%  of  the
decisions  in  2002)  or  that  it  does  not  comply  with  State  aid  rules  and  hence  is  not
compatible with the Common Market and takes a negative decision (7% of all decisions
in  2002).  Graph  7  shows  the  share  of  incompatible  and  compatible  aid  cases  that  have
been examined by the Commission during the period 2000-2002.

27

Graph 7:

Share of negative decisions by Member State, 2000-2002

Negative decisions

Positive decisions

e
g
a
t
n
e
c
r
e
p
n

i

100

90

80

70

60

50

40

30

20

10

0

87

93

100

88

94

92

96

98

91

94

92

100

98

97

100

13

7

EU
(2086)

B
(78)

0

DK
(52)

12

6

8

4

D
(426)

EL
(50)

E
(345)

F
(230)

6

9

2

IRL
(61)

I
(329)

NL
(141)

0

A
(93)

8

P
(62)

2

FIN
(53)

3

S
(31)

0

UK
(125)

Figures in brackets show total number of decisions 2000 - 2002

Note:  Excluded  under  ‘final’  decisions  are  all  decisions  taken  in  2002  to  open  a  formal  investigation
procedure as well as corrigenda, addenda, injunctions, etc. The total also excludes those decisions in which
the Commission decides that the notified aid does not in fact constitute aid as defined under Article 87(1).
There were 30 such decisions in 2002. Included under ‘positive’ decisions are the 10 conditional decisions
taken during the period under review. Luxembourg has not been included in the graph due to the relatively
small number of decisions (10 final decisions, of which 8 were positive) over this period.

Source:  European Commission (DG Agriculture, Fisheries, Competition, Transport and Energy).

3.3

Recovery of aid

The Commission  has  the  power  to  require  that  aid  granted  by  Member  States  which  is
incompatible  with  the  common  market  be  repaid  by  recipients  to  the  public  authorities
which granted it. The Member State must recover the aid immediately in accordance with
domestic procedures. Table 11 gives an overview of the pending recovery orders. As of
February 2003, there were 81 such orders, of which 43 involved Germany and 18 Spain.

Table 11:

Recovery orders pending in February 2003

In process of
execution

Forming part
of bankruptcy
procedures

38

27

Currently
object of
National
court
procedures
10

Currently
object of
European court
procedures

Total
number
pending

6

81

Note: 

State aid recovery procedures in sectors other than agriculture, fisheries and transport.

Source:  DG Competition.

28

 
In 2002, the Commission took 19 negative decisions in which it requested Member States
to recover aid of well over €1 billion. This figure is underestimated as it is not possible to
identify  the  exact  amount  of  incompatible  aid  in  cases  when  aid  is  awarded  to  a  large
number of beneficiaries through a scheme or  when  a  certain type  of instrument  is  used
that is difficult to quantify, e.g., a guarantee.

3.4 Modernising State aid control

The Commission is continuing its efforts to modernise and reform State aid control with
a  view  to  simplifying  State  aid  procedures  for  clear-cut  cases  and  concentrating
Commission resources on the most serious distortions of competition. The Commission
recently undertook a detailed internal review to identify the possibilities for simplifying
procedures  and  reducing  their  duration.  As  a  result  of  this  review,  the  Commission
services  identified  a  number  of  possible  changes  which  are  currently  the  subject  of
detailed  consultation  with  experts  from  Member  States.  This  work  may  lead  to  the
preparation of implementing provisions under Article 27 of Regulation (EC) n° 659/1999
concerning  the  form,  content  and  other  details  of  notifications,  the  form,  content  and
other  details  of  annual  reports,  details  of  time-limits  and  the  calculation  of  time-limits,
and  the  interest  rate  for  the  recovery  of  unlawful  aid,  as  well  as  other  suggestions  to
improve current procedures and working methods.

More  specifically,  with  regard  to  State  aid  procedures  in  the  fisheries  sector,  the
Commission has proposed to eliminate the separate state aid scrutiny of Member States’
obligatory  financial  contributions  to  projects  co-financed  as  part  of  the  Community
structural assistance in this sector.14

The Commission will also continue to a review its State aid instruments to simplify and
clarify them, and remove possible conflicts between the different texts. This is a complex
process which is likely to last several years. Nevertheless, much work has already been
done.

The adoption of  the  new  multi-sectoral  framework  (see  Section  2.3)  in  2002  sets  out  a
much  clearer  set  of  rules  for  the  evaluation  of  State  aid  for  large  regional  investment
projects  and  at  the  same  time  eliminates  the  need  for  prior  notification  of  many  aid
projects,  provided  the  aid  is  granted  in  the  framework  of  an  approved  regional  aid
scheme.  The  new  framework  also  brings  together  and  consolidates  in  a  single  text  the
different  texts  which  previously  applied  in  the  steel,  synthetic  fibres  and  automobile
sectors.

Following  the  successful  introduction  of  block  exemption  regulations  for  aid  for  small
and  medium-sized  enterprises  and  training15,  the  Commission  adopted  in  2002  a  block
exemption for State aid for employment16. This eliminates the need for prior notification
of many State aids for the purposes of  creating employment or aiding disadvantaged or
disabled workers.

14 Proposal for a Council  Regulation amending  Regulation (EC) No  2792/1999  laying  down  the  detailed
rules  and  arrangements  regarding  Community  structural  assistance  in  the  fisheries  sector,  Art.  19  on
“Obligatory financial contributions and state aid”, COM(2002) 187 final of 28.5.2002, p. 11.
15 Regulation (EC) N°68/2001 and N° 70/2001
16 Regulation (EC) N°2204/2002

29

                                                
Within  the  framework  of  the  Commission  Communication  to  the  European  Parliament
and  the  Council  on  the  Mid  Term  Review  of  the  Common  Agricultural  Policy17,  the
Commission  has  recently  adopted  a  draft  block  exemption  system  for  certain  types  of
State  aid  up  to  certain  ceilings,  granted  to  farmers  or  to  companies  processing  and
marketing agricultural products. This will allow Member States to grant various types of
agricultural  state  aid  without  having  to  seek  the  Commission's  prior  clearance.  Once
adopted, this block exemption will speed up the implementation of new agricultural state
aids.  This,  in  turn,  will  facilitate  national  programmes  aiming  at  the  improvement  of
environmental, animal welfare and hygiene standards in the agriculture sector.

In addition, the Commission is continuing its work to clarify the relationship between the
State  aid  rules  and  the  provision  by  Member  States  of  compensation  for  the  cost  of
providing services of general economic interest. A  first meeting with representatives of
Member  States  took  place  in  December  2002  on  the  basis  of  a  non  paper  and  detailed
comments have since been received. The Commission is not yet in a position to finalise a
position due to the evolving nature of the jurisprudence of the Court of Justice.

In 2003, the Commission intends to update the block exemptions for small and medium-
sized enterprises (SMEs) and training aid, in particular to provide for a block exemption
for research and development for SMEs.

The  Commission  will  launch  a  comprehensive  review  of  the  guidelines  on  rescue  and
restructuring aid in view of the preparation of new guidelines to replace the existing ones
which expire in 2004. This subject will be dealt with in more detail in the autumn edition
of the Scoreboard.

The Commission will also  undertake  a review of the regional aid rules  in readiness  for
the expiry of the current rules in 2006.

17 COM (2002) 394 final of 10.7.2002

30

                                                
STATE AID FORA

The online Scoreboard contains internet-links to information on State aid policy issues of
the Member States and the European Parliament.

http://europa.eu.int/comm/competition/state_aid/scoreboard/

31

TECHNICAL ANNEX

The  Scoreboard  covers  national  State  aid  as  defined  under  Article  87(1)  EC  Treaty  that  is
granted  by  the  fifteen  Member  States  and  has  been  examined  by  the  Commission.
Accordingly,  general  measures  are  not  included  in  the  figures.  For  example,  a  general  tax
break for expenditure on research and development is not considered as State aid although it
may  well  appear  in  Member  States  national  budgets  as  public  support  for  research  and
development. Furthermore, Community funds and instruments are also excluded. All State aid
data refer  to  the  implementation  of  Commission  decisions  and  not  cases  that  are  still  under
examination,  which  once  decided  upon,  may  have  an  effect  on  historical  data.  State  aid
expenditure  is  attributed  to  the  year  it  was  made.  In  cases  that  result  in  expenditure  over  a
number of years, the total amount is attributed to each of the years in which expenditure took
place.

All data are provided in million (or billion where appropriate) euro at constant 2000 prices.

The following symbols have been used in the Scoreboard:

n.a.

not available

-

0

real zero

less than half the unit used

Further information on methodological issues and a wide array of statistical tables may be
found on the online Scoreboard:

http://europa.eu.int/comm/competition/state_aid/scoreboard/

32

Data for table 1 and graph 1

Total state aid by Member State, in million euro

EU

B

DK

D

EL

E

F

IRL

I

L

NL

A

P

FIN

S

UK

1997

Total aid 101.683,8
51.654,7
Total* aid
3.224,4
Total aid
772,6
Total* aid
1.691,3
Total aid
953,5
Total* aid
29.375,9
Total aid
17.291,9
Total* aid
1.779,2
Total aid
766,6
Total* aid
5.816,8
Total aid
3.777,7
Total* aid
20.560,1
Total aid
10.920,0
Total* aid
602,6
Total aid
347,8
Total* aid
17.565,1
Total aid
8.679,9
Total* aid
103,1
Total aid
Total* aid
52,5
2.420,9
Total aid
603,4
Total* aid
2.366,0
Total aid
591,1
Total* aid
2.251,9
Total aid
1.670,5
Total* aid
2.518,7
Total aid
523,4
Total* aid
1.863,3
Total aid
506,2
Total* aid
9.544,3
Total aid
4.197,6
Total* aid

1998
95.721,3
48.317,2
3.271,7
874,1
1.975,7
1.037,8
27.882,6
15.882,5
1.314,4
515,4
6.196,8
3.882,7
18.201,8
9.798,8
1.100,6
852,5
15.119,1
7.423,3
262,0
55,8
3.223,9
600,1
2.229,0
531,9
1.487,7
1.140,1
2.514,9
501,3
2.043,4
559,4
8.897,7
4.661,3

1999
85.700,6
39.013,0
3.311,4
877,9
2.107,4
1.060,1
26.189,7
14.611,8
1.189,6
412,9
5.280,1
3.177,5
16.770,1
7.435,0
1.259,9
807,8
11.013,1
4.173,3
262,3
42,0
3.840,0
763,2
2.123,6
517,5
1.382,2
1.057,7
2.329,7
469,2
1.869,5
561,9
6.771,9
3.045,0

2000
85.267,1
38.232,2
3.320,9
797,8
2.593,9
1.413,5
24.994,3
13.953,0
1.287,2
609,7
5.209,3
3.101,7
16.713,9
6.964,6
1.344,7
718,4
12.068,9
4.511,4
287,6
41,9
3.841,4
675,8
1.987,5
448,1
1.311,0
978,0
2.258,3
464,7
1.844,4
526,1
6.203,7
3.027,5

2001
86.114,1
33.463,2
3.330,3
778,4
2.369,0
1.180,4
23.273,5
11.853,2
1.305,7
465,3
4.658,6
2.622,8
15.844,3
6.105,0
1.300,7
705,7
11.998,6
4.120,5
273,2
33,0
3.992,2
629,5
2.056,0
546,5
1.225,1
901,8
2.073,9
375,5
1.862,9
506,2
10.550,1
2.639,3

Total* aid: Total aid less agriculture, fisheries and transport.
Source:

DG Competition

33

GDP by Member State, in million euro

1997

1998

1999

2000

2001

100.181
536.333

121.650
609.319

247.469
171.668

227.734
158.760

110.707
564.012

232.821
162.687

EU 7.826.686 8.086.526 8.273.555 8.560.404 8.693.742
249.384
B
238.577
DK
174.118
166.964
1.905.104 1.947.243 1.973.621 2.030.000 2.041.685
D
EL
128.155
112.951
E
625.651
584.879
F
1.289.634 1.331.159 1.365.238 1.416.877 1.442.847
IRL
108.757
1.090.890 1.118.745 1.132.225 1.164.767 1.185.359
I
21.031
L
407.695
NL
A
208.420
P
117.453
FIN
131.079
S
262.245
UK 1.435.098 1.477.073 1.512.659 1.559.392 1.589.862

20.815
402.599
207.037
115.546
130.234
260.120

19.106
389.685
199.975
111.439
123.412
249.237

18.156
377.423
195.987
108.009
120.082
238.351

16.847
360.267
188.174
101.694
112.582
229.958

102.910

93.587

73.431

84.069

Source:  Eurostat database Newcronos

Data for graph 2

Total state aid less agriculture, fisheries and transport as a percentage of GDP, 1997 - 2001.

Total* state aid

GDP

Total*State
aid as a % of GDP

Average
1997 - 1999
** 46.489,1
841,5
1.017,2
15.928,7
565,0
3.612,6
9.384,6
** 830,2
6.758,8
50,1
655,5
546,8
1.289,5
498,0
542,5
3.968,0

EU
B
DK
D
EL
E
F
IRL
I
L
NL
A
P
FIN
S
UK

Average
1999 - 2001

Average
1997 - 1999
36.902,8 ** 8.067.388
233.044
162.804
1.941.990
107.946
561.742
1.328.677
** 88.828
1.113.953
18.036
375.792
194.712
107.047
118.692
239.182
1.474.943

818,0
1.218,0
13.472,7
496,0
2.967,3
6.834,9
744,0
4.268,4
39,0
689,5
504,0
979,2
436,5
531,4
2.903,9

Average
1999 - 2001
8.509.233
245.143
170.917
2.015.102
120.919
606.617
1.408.321
101.751
1.160.784
20.317
399.993
205.144
114.813
128.241
257.201
1.553.971

Average
1997 - 1999
0,58
0,36
0,62
0,82
0,52
0,64
0,71
0,93
0,61
0,28
0,17
0,28
1,20
0,42
0,23
0,27

Average
1999 - 2001
0,43
0,33
0,71
0,67
0,41
0,49
0,49
0,73
0,37
0,19
0,17
0,25
0,85
0,34
0,21
0,19

*
**
Source:  DG Competition

Total aid less agriculture, fisheries and transport
Data for Ireland cover the period 1998 - 1999 instead of 1997 - 1999.

34

Total state aid as a percentage of GDP, 1997 - 2001.

Total state aid

GDP

Total state
aid as a % of GDP

Average
1997 - 1999
* 93.380,9
3.269,2
1.924,8
27.816,1
1.899,6
5.292,7
18.510,7
* 1.180,2
14.565,8
209,2
3.161,6
2.239,5
1.707,3
2.454,5
1.925,4
8.404,6

EU
B
DK
D
EL
E
F
IRL
I
L
NL
A
P
FIN
S
UK

Average
1999 - 2001

Average
1997 - 1999
85.693,9 * 8.067.388
233.044
162.804
1.941.990
107.946
561.742
1.328.677
* 88.828
1.113.953
18.036
375.792
194.712
107.047
118.692
239.182
1.474.943

3.320,9
2.356,8
24.819,2
1.719,6
4.590,5
16.442,8
1.301,8
11.693,5
274,4
3.891,2
2.055,7
1.306,1
2.220,7
1.858,9
7.841,9

Average
1999 - 2001
8.509.233
245.143
170.917
2.015.102
120.919
606.617
1.408.321
101.751
1.160.784
20.317
399.993
205.144
114.813
128.241
257.201
1.553.971

Average
1997 - 1999
* 1,16
1,40
1,18
1,43
1,76
0,94
1,39
* 1,33
1,31
1,16
0,84
1,15
1,59
2,07
0,81
0,57

Average
1999 - 2001
1,01
1,35
1,38
1,23
1,42
0,76
1,17
1,28
1,01
1,35
0,97
1,00
1,14
1,73
0,72
0,50

*
Source:  DG Competition

Data for Ireland cover the period 1998 - 1999 instead of 1997 - 1999.

Data for table 4

State aid by sector in the Community, in million euro, 1997 - 2001.

Overall national aid
of which:
     Agriculture
     Fisheries
     Manufacturing
     Coal mining
     Transport
     Services
     Not elsewhere classified*

1997
101.683,8

1998
95.721,3

1999
85.700,6

2000
85.267,1

2001
86.114,1

15.561,7
264,5
33.580,2
8.199,2
34.202,8
6.812,6
3.062,8

13.275,6
319,7
28.773,4
8.619,4
33.808,8
7.432,3
3.492,1

13.139,5
313,3
24.649,2
6.789,3
33.234,8
3.809,1
3.765,5

13.080,0
306,1
24.444,8
6.976,6
33.648,8
3.346,0
3.464,7

13.024,6
297,3
21.287,3
6.201,0
39.328,9
3.071,6
2.903,4

* 

This category includes aid to other non-manufacturing sectors and aid for employment and training that
can not be classified elsewhere.

Source:  DG Competition

35

Data for table 6 and graph 3

State aid to the manufacturing sector* by Member State, in million euro.

1997

1998

1999

2000

2001

33.580,2
643,0
752,8
11.449,6
766,6
1.877,8
5.458,7
142,1
8.436,2
52,5
578,9
531,3
230,8
458,2
356,3
1.845,5

28.773,4
710,9
666,6
10.499,7
515,2
1.826,3
4.292,9
634,4
5.955,8
53,0
575,2
484,2
192,6
434,1
431,1
1.501,3

24.649,2
728,5
665,7
9.533,4
405,6
1.113,1
4.380,3
533,4
3.633,5
38,4
716,3
459,0
266,7
418,2
436,8
1.320,4

24.444,8
582,4
1.040,0
9.087,1
602,5
1.146,6
4.009,9
501,2
3.988,7
38,1
641,7
405,5
224,3
420,1
398,2
1.358,6

21.287,3
604,5
604,4
7.576,9
462,1
1.041,3
3.304,6
459,1
3.904,8
28,8
595,3
497,3
202,6
335,5
380,0
1.290,1

Average
1997 - 1999
** 29148,2
694,1
695,0
10.494,2
562,5
1.605,7
4.710,7
** 583,9
6.008,5
48,0
623,5
491,5
230,0
436,8
408,0
1.555,7

Average
1999 - 2001
23.460,4
638,5
770,0
8.732,5
490,1
1.100,3
3.898,3
497,9
3.842,3
35,1
651,1
453,9
231,2
391,2
405,0
1.323,0

EU
B
DK
D
EL
E
F
IRL
I
L
NL
A
P
FIN
S
UK

*
Source:  DG Competition

see definition in Section 1.3

Data for table 7

State aid for horizontal objectives and particular sectors, 1997 - 1999, in % of total aid less
agriculture, fisheries and transport.

Horizontal Objectives
     Research and Development
     Environment
     SME
     Commerce
     Energy saving
     Employment aid
     Training aid
     Other Objectives (1)

Particular sectors
     Shipbuilding
     Other Manufacturing Sectors (2)
     Other Non-manufacturing Sectors
     Coal
     Tourism
     Financial Services
     Media, Cultural sector & services
Total aid less agriculture, fisheries 
and transport in million euro

EU* B DK
93
59 97
17
9 16
25
1
3
1
12 24
4
1
1
16
1
0
12
2 12
17
4
5
1
26 40

41
3
8
0
17
1
9
4

3
-
1
-
-
1
-
1

7
4
0
-
-
1
-
2

D

EL E

50 97
0
8
0
5
2
9
0
0
-
1
1
-
-
0
26 94

50
2
15
0
31
1
1
0

3
1
1
-
-
-
-
0

46
6
0
7
0
1
4
18
10

54
13
7
1
32
1
-
1

F IRL*
74
40
1
11
-
0
0
11
0
1
1
0
4
0
1
0
68
15

60
3
8
0
11
0
36
3

26
-
1
3
-
0
21
2

I
L NL A
85 96 92 88
4 9 25 32
6 10
0 4
3 16
33 21
-
0 1
5
0
0 - 24
3
0
3 -
-
0
-
-
44 60 28 25

15 4
2 -
5 0
0 -
-
-
1 -
6 -
1 4

8 12
-
3
5
-
-
0
-
-
7
-
-
-
-
4

P FIN S UK
75
27 88 81
5
1 33 18
1
1 18
-
8
7
2 14
1
-
8
0
0
6
8
1
-
7
2
9
36
4
-
7
24
9 13 26

73 12 19
-
8
1
-
2
4
-
-
-
-
-
-
-
-
3
-
-
1
3 19
64

25
0
0
-
18
0
0
7

46.489 842 1.017 15.929 565 3.613 9.385 830 6.759 50 656 547 1.289 498 543 3.968

*
(1)
(2)
Source:  DG Competition

Data for Ireland cover the period 1998 - 1999 instead of 1997 - 1999.
Includes aid for general regional development not elsewhere classified.
Includes aid for the steel sector as well as aid for rescue and restructuring not elsewhere classified.

36

State aid for horizontal objectives and particular sectors, 1999 - 2001, in % of total aid less
agriculture, fisheries and transport.

Horizontal Objectives
     Research and Development
     Environment
     SME
     Commerce
     Energy saving
     Employment aid
     Training aid
     Other Objectives (1)

Particular sectors
     Shipbuilding
     Other Manufacturing Sectors (2)
     Other Non-manufacturing Sectors
     Coal
     Tourism
     Financial Services
     Media, Cultural sector & services

Total aid less agriculture, fisheries and 
transport in million euro

I

EU

69
12
10
14
1
2
3
6
21

31
2
2
0
18
1
5
3

B DK
91
98
10
18
33
2
1
23
1
0
12
0
18
16
16
4
1
34

2
-
0
-
-
1
-
1

9
6
0
-
-
0
-
2

D

EL E

61 99
1
11
1
21
4
7
-
0
-
1
-
1
0
-
20 93

39
2
3
0
33
1
0
0

1
-
-
-
-
-
-
1

56
9
1
8
0
1
6
19
14

44
1
4
1
37
0
-
1

F
IRL
52 74
1
12
-
1
0
19
0
2
0
1
6
0
0
2
15 64

48 26
-
3
1
3
2
0
-
15
0
1
24 18
4
3

L NL A P FIN S UK
90
8
4
9
0
0
-
45
24

39 91 79
2 37 16
1 30
-
9
7 12
0
-
6
0 15 10
-
7
8
12
3
0
9 14 10

91 91
25 35
11 13
8 16
-
4
1
17
4
0
-
-
25 22

92 90
14 19
0
3
44 28
1
0
-
0
-
5
0
-
28 40

8 10
-
2
0
1
-
0
-
-
-
3
-
2
0 10

9
4
-
0
-
-
-
5

9
-
3
-
-
6
-
-

61
-
5
-
-
4
1
51

9 21
-
5
-
1
-
-
-
-
-
-
-
-
3 21

10
0
0
-
3
0
-
6

36.903 818 1.218 13.473 496 2.967 6.835 744 4.268 39 689 504 979 436 531 2.904

(1)
(2)
Source:  DG Competition

Includes aid for general regional development not elsewhere classified.
Includes aid for the steel sector as well as aid for rescue and restructuring not elsewhere classified.

Data for graph 4

Share of state aid directed to horizontal objectives, 1997 - 2001.

Aid to horizontal
objectives 
in m illion €

T otal aid **
in m illion €

Average
1997 - 1999
* 27372
818,1
948,7
7.975,7
547,1
1.652,0
3.744,0
* 616
5.744,0
47,9
603,9
481,6
345,2
438,6
440,3
2.969,0

Average
1999 - 2001
25.294,2
800,4
1.110,7
8.259,2
490,1
1.675,0
3.538,3
552,9
3.921,3
35,1
624,4
458,7
382,7
398,7
421,0
2.625,7

Average
1997 - 1999
* 46489
841,5
1.017,2
15.928,7
565,0
3.612,6
9.384,6
* 830
6.758,8
50,1
655,5
546,8
1.289,5
498,0
542,5
3.968,0

Average
1999 - 2001
36.902,8
818,0
1.218,0
13.472,7
496,0
2.967,3
6.834,9
744,0
4.268,4
39,0
689,5
504,0
979,2
436,5
531,4
2.903,9

EU
B
DK
D
EL
E
F
IRL
I
L
NL
A
P
FIN
S
UK

*
**
Source:  DG Competition

data for Ireland cover the period 1998 - 1999 instead of 1997 - 1999.
total aid less agriculture, fisheries and transport.

Aid to horizontal 
objectives
as a % of total aid **

1997 - 1999 1999 - 2001

58,9
97,2
93,3
50,1
96,8
45,7
39,9
74,2
85,0
95,6
92,1
88,1
26,8
88,1
81,2
74,8

68,5
97,8
91,2
61,3
98,8
56,4
51,8
74,3
91,9
89,9
90,6
91,0
39,1
91,3
79,2
90,4

37

Data for graph 5

State aid specifically earmarked for 'a' assisted regions, 1991 - 2001.

EU

D

EL

E

F

IRL

I

A

P

UK

million €
% of total*
million €
% of total*
million €
% of total*
million €
% of total*
million €
% of total*
million €
% of total*
million €
% of total*
million €
% of total*
million €
% of total*
million €
% of total*

1991
16.115
33
5.704
29
1.097
100
397
19
470
6
208
100
7.383
63

1992
22.128
39
12.386
48
1.172
100
291
11
363
4
236
100
6.728
55

1993
27.260
44
17.081
55
683
100
497
18
448
5
238
100
7.213
54

1994
25.583
46
17.112
59
316
100
491
20
421
7
192
100
5.660
51

504
100
352
11

628
100
324
13

721
100
378
29

939
100
451
15

1995
24.145
46
11.432
58
759
100
579
13
438
9
217
100
9.381
71
46
9
640
100
652
15

1996
20.786
37
10.471
55
633
100
659
18
522
5
283
100
6.526
54
33
6
1.116
100
544
12

1997
19.088
37
8.602
50
767
100
616
16
662
6
348
100
5.896
68
32
5
1.671
100
495
12

1998
15.973
33
7.782
49
515
100
698
18
863
9
853
100
3.607
49
37
7
1.140
100
477
10

1999
11.018
28
5.013
34
413
100
802
25
576
8
808
100
1.957
47
38
7
1.058
100
354
12

2000
8.070
21
2.646
19
610
100
799
26
360
5
640
89
1.692
38
11
2
978
100
334
11

2001
8.016
24
2.536
21
465
100
697
27
348
6
647
92
2.116
51
16
3
902
100
288
11

*
Source:  DG Competition

total aid less agriculture, fisheries and transport.

Data for graph 7

Closing of proceedings with a:

Approval 
without 
objections

Positive 
decisions

Conditional 
decisions

Negative 
decisions

Negative 
decisions 
as % of 
total

Closing of proceedings with a:

Approval 
without 
objections

Positive 
decisions

Conditional 
decisions

Negative 
decisions

Negative 
decisions 
as % of 
total

EU

B

DK

D

EL

E

F

IRL

2000
2001
2002
2000
2001
2002
2000
2001
2002
2000
2001
2002
2000
2001
2002
2000
2001
2002
2000
2001
2002
2000
2001
2002

571
591
663
23
21
22
11
23
18
95
123
126
9
16
21
104
112
91
58
68
87
17
20
21

28
37
38
0
2
0
0
0
0
9
11
11
0
1
0
3
3
4
0
3
3
2
0
0

4
1
5
0
0
0
0
0
0
1
0
1
0
0
0

0
1
0
0
1
0
0
0

53
42
53
5
3
2
0
0
0
12
14
23
1
0
2
8
12
6
4
4
2
1
0
0

8,1
6,3
7,0
17,9
11,5
8,3
0,0
0,0
0,0
10,3
9,5
14,3
10,0
0,0
8,7
6,9
9,4
5,9
6,5
5,3
2,2
5,0
0,0
0,0

I

L

NL

A

P

FIN

S

UK

2000
2001
2002
2000
2001
2002
2000
2001
2002
2000
2001
2002
2000
2001
2002
2000
2001
2002
2000
2001
2002
2000
2001
2002

92
61
113
4
2
2
48
38
40
31
36
23
16
15
21
22
9
18
13
5
11
28
42
49

7
9
13
0
0
0
1
3
1
2
1
0
1
0
4
2
1
0
1
0
0
0
3
2

1
1
1
0
0
0
1
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1

15
7
9
0
0
2
5
2
2
0
0
0
1
0
4
0
0
1
1
0
0
0
0
0

13,0
9,0
6,6
0,0
0,0
50,0
9,1
4,7
4,7
0,0
0,0
0,0
5,6
0,0
13,8
0,0
0,0
5,3
6,7
0,0
0,0
0,0
0,0
0,0

Source: EU Commission database Integrated State Aid Information System.

38

 
ANNEX 1

List of regions within the meaning of Article 87(3)a at NUTS level II

OESTERREICH
DEUTSCHLAND

ESPANA

SUOMI / FINLAND
FRANCE

ELLADA
IRELAND
ITALIA

PORTUGAL

UNITED KINGDOM

BURGENLAND
BRANDENBURG
MECKLENBURG-VORPOMMERN
CHEMNITZ
DRESDEN
LEIPZIG
DESSAU
HALLE
MAGDEBURG
THUERINGEN
GALICIA
ASTURIAS
CASTILLA-LEON
CASTILLA-LA MANCHA
EXTREMADURA
COMUNIDAD VALENCIANA
ANDALUCIA
MURCIA
CEUTA Y MELILLA
CANARIAS
ITA-SUOMI
GUADELOUPE
MARTINIQUE
GUYANE
REUNION
ALL REGIONS
BORDER, MIDLAND AND WESTERN
CAMPANIA
PUGLIA
BASILICATA
CALABRIA
SICILIA
SARDEGNA
NORTE
CENTRO
ALENTEJO
ALGARVE
ACORES
MADEIRA
MERSEYSIDE
SOUTH YORKSHIRE
CORNWALL AND ISLES OF SCILLY
WEST WALES AND THE VALLEYS

Note: Northern Ireland (UK), which prior to 2000 had ‘a’ status, was given special ‘c’ status for the
period 2000-2006. For the purposes of the Scoreboard, however, Northern Ireland is regarded as being
equivalent to an ‘a’ region due to the relatively high aid intensity for this area.

39