Proposal for a Council Decision on the position to be taken by the Community within the Association Committee established by the Europe Agreement between the European Communities and their Member States, of the one part, and the Czech Republic, of the other part, with regard to the adoption of a Regional aid map on the basis of which regional aid granted by Czech Republic will be assessed
Date: 2003-08-07
Institutions: European Commission
Subjects: Czechia, European Association Agreement, accession to the European Union, control of State aid, eligible region, regional aid, regional policy

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 07.08.2003
COM(2003) 482 final

2003/0183 (ACC)

Proposal for a

COUNCIL DECISION

on the position to be taken by the Community within the Association Committee
established by the Europe Agreement between the European Communities and
their Member States, of the one part, and the Czech Republic, of the other part,
with regard to the adoption of a Regional aid map on the basis of which regional
aid granted by Czech Republic will be assessed

(presented by the Commission)

EXPLANATORY MEMORANDUM

1.

This  is  a  proposal  for  the  adoption  of  a  Regional  aid  map  on  the  basis  of
which regional aid granted by Czech Republic will be assessed.

According  to  Article  64(4)(a)  of  the  Europe  Agreement,  the  Parties
recognised  that  during  the  first  five  years  after  its  entry  into  force,  any
regional  aid  granted  by  the  Czech  Republic  shall  be  assessed  taking  into
account  the  fact  that  the  Czech  Republic  shall  be  regarded  as  an  area
identical to those areas of the Community described in Article 87(3)(a) of the
Treaty establishing the European Community.

On  8  March  2001  the  EU-Czech  Republic  Association  Council  adopted
decision No 3/2001 with regard to the extension for a further period of five
years  of  the  Czech  Republic  as  an  area  identical  to  those  areas  of  the
Community  described  in  Article  87(3)(a)  of  the  Treaty  establishing  the
European Community. The decision was applied as from 1 January 1997 and
has expired on 31 December 2001.

Article 2 of decision No 3/2001 obliged the Czech Republic to submit the per
capita  Gross  Domestic  Product  figures  which  have  been  harmonised  at
NUTS level II to the European Commission within six months of the date of
the  adoption  of  the  decision.  On  that  basis,  the  Czech  Republic  State  aid
monitoring  authority  (Office  for  the  Protection  of  Economic  Competition)
and the European Commission jointly evaluated the eligibility of the regions
as well as the maximum aid intensities in relation thereto, in order to draw up
the regional aid map on the basis of  the  Community  guidelines  on  national
regional aid 1.

In reference to Article 4(2) of the Implementing Rules for the application of
the provisions on State aid of the Europe Agreement, it is considered that the
duration  of  the  Regional  aid  map  should  cover  the  period  between  31
December 2001, the expiry date of the period for which Czech Republic was
considered as an area identical to those areas of the Community described in
Article  87(3)(a)  of  the  Treaty  in  accordance  with  the  decision  of  decision
No 3/2001 of the EU-Czech Republic Association Council of 8 March 2001,
and  the date of  accession  or  31  December  2006,  whatever  comes  first.  The
inclusion  of  31  December  2006  as  end  date  is  important  to  maintain
consistency  with  the  maps  for  the  current  Member  States,  all  of  which
(except  the  map  for  Germany)  will  expire  on  that  date,  as  well  as  with  the
programming of Structural Funds support.

2.

According  to  the  Community  guidelines  on  national  regional  aid,  the
eligibility conditions for the derogation under Article 87(3)(a) of the Treaty are
fulfilled if the region, being a NUTS level II geographical unit, has a per capita
gross domestic product, measured in purchasing power standards (GDP/PPS),
of less than 75% of the Community average. In the case of regions falling under
Article  87(3)(a)  the  intensity  of  regional  aid  must  not  exceed  50%  net  grant

1

OJ C 74 of 10.3.1998, p. 9.

2

                                                
equivalent (NGE), except in the outermost regions, where it may be as much as
65% NGE. In the NUTS level II regions eligible under Article 87(3)(a) whose
per  capita  GDP/PPS  is  greater  than  60%  of  the  Community  average,  the
intensity  of  regional  aid  must  not  exceed  40%  NGE, except in  the  outermost
regions, where it may be as high as 50% NGE. The GDP/PPS of each region
and  the  Community  average  to  be  used  in  the  analysis  must  relate  to  the
average of the last three years for which statistics are available.

Also  according  to  the  Community  guidelines  on  national  regional  aid,  a
national  ceiling  on  population  coverage  for  regions  eligible  under  Article
87(3)(c)  of  the  Treaty  is  set,  in  each  Member  State,  at  a  sufficient  level  to
include all the regions which have just  lost  their  Article  87(3)(a)  status  and
areas  with  a  low  population  density.  For  parts  of  the  regions  that  lose  their
Article 87(3)(a) status as a result of the review of the regional aid map and that
acquire  Article  87(3)(c)  status,  the  Commission  could  accept,  during  a
transitional  period  of  four  years,  a  progressive  reduction  of  the  aid  intensity
ceilings  for  which  such  regions  would  have  been  eligible  under  Article
87(3)(a),  at  a  linear  or  faster  rate,  until  the  intensity  ceiling  corresponding  to
their new status is reached.

In the case of regions falling under Article 87(3)(c), the  ceiling  on  regional
aid must not exceed 20% NGE, except in the low population density regions
or in the outermost regions, where it may be as high as 30% NGE. In regions
eligible under Article 87(3)(c), which have both a higher per capita GDP/PPS
and a lower unemployment rate than the respective Community average, the
intensity  of  regional  aid  must  not  exceed  10%  NGE  except  in  the  low
population  density  regions  or  in  the  outermost  regions,  where  it  may  be  as
high  as  20%  NGE.  Exceptionally  in  the  case  of  regions  subject  to  the  said
ceiling of  10%  NGE,  higher intensities  not  exceeding  the normal  ceiling of
20% NGE may be approved for regions (corresponding to NUTS level III or
smaller) adjoining a region with Article 87(3)(a) status. Again, the GDP/PPS
of each  region and  the  Community  average to be  used in  the  analysis  must
relate to the average of the last three years for which statistics are available.

In the case aid is granted to small and medium-sized enterprises2, the above aid
intensity ceilings may be raised by 15 percentage points gross grant equivalent
(GGE) in Article 87(3)(a) regions and by 10 percentage points GGE in Article
87(3)(c) regions.

The above ceilings constitute upper limits which apply to the total aid whenever
assistance  is  granted  concurrently  under  several  regional  schemes,  and
regardless  of  whether  it  comes  from  local,  regional,  national  or  Community
sources. Beneath these ceilings, regional aid intensity ceilings are to be adjusted
to reflect the seriousness and intensity of the regional problems addressed. The
seriousness  and  intensity  of  the  regional  problems  must  be  assessed  within
the  broader  context  of  the  Community  and  of  the  countries  with  which
Europe agreements have been concluded.

2

OJ L 107 of 30.4.1996, p. 4.

3

                                                
3.

4.

5.

6.

7.

The  Czech  Republic  consists  of  eight  NUTS  level  II  regions.  According  to
the statistical data available for the years 1998-2000, one of these (Praha) has
a per capita GDP/PPS that exceeds 75% of the Community average. However,
the Praha region, which is also a single NUTS level III region, had been eligible
for Article 87(3)(a) until 31 December 2001, and can therefore be regarded as a
region that just lost its Article 87(3)(a) status. According to the same statistical
data,  the  seven  other  Czech  NUTS  level  II  regions  all  have  a  per  capita
GDP/PPST that is lower than 60% of the Community average.

In  the  proposed  regional  aid  map,  all  NUTS  level  II  regions  but  Praha  are
therefore  granted  the  Article  87(3)(a)  status.  The  regional  aid  intensities
ceilings are set at the following levels:

50%  NGE 
Moravskoslezsko,

in 

the  NUTS 

level  II  regions  of  Střední  Čechy  and

49% NGE in the NUTS level II regions of Severozápad and Střední Morava,

48%  NGE  in  the  NUTS  level  II  regions  of  Severovýchod  and  Jihovýchod,
and

46% NGE in the NUTS level II region of Jihozápad.

The above aid intensities are raised by 15 percentage points GGE in the case
of aid granted to small and medium-sized enterprises.

As a former 87(3)(a) region, the NUTS level II region of Praha is granted the
Article 87(3)(c) status. Since the Czech Republic does not wish to make use of
the  ity  to  make  use  of  the  possibility  to  apply  the  transitional  period  during
which aid intensities can be progressively reduced, and considering that Praha
is  also  a  NUTS  level  III  region  that  adjoins  regions  with  an  Article  87(3)(a)
status, the regional aid intensity ceiling is set at 20% NGE. This ceiling is raised
by 10 percentage points GGE in the case of aid granted to small and medium-
sized enterprises.

The Czech Republic State aid monitoring authority (Office for the Protection
of Economic  Competition)  and  the  European  Commission  jointly  evaluated
the  proposed  regional  aid  map  for  the  Czech  Republic  (eligibility  of  the
regions  as  well  as  the  maximum  aid  intensities  in  relation  thereto)  and
concluded that it is in conformity with the Community guidelines on national
regional aid.

The  Commission  hereinafter  submits  the  joint  proposal  to  the  Council  and
requests  the  Council  to  adopt  the  attached  proposal  for  an  Association
Committee Decision.

4

2003/0183 (ACC)

Proposal for a

COUNCIL DECISION

on the position to be taken by the Community within the Association Committee
established by the Europe Agreement between the European Communities and
their Member States, of the one part, and the Czech Republic, of the other part,
with regard to the adoption of a Regional aid map on the basis of which regional
aid granted by Czech Republic will be assessed

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular
Article 133 in conjunction with the first sentence of Article 300(2) first subparagraph
first sentence and second subparagraph thereof;

Having regard to the proposal of the Commission3

Whereas:

(1) 

(2) 

(3) 

(4) 

The  European  Communities  and  their  Member  States  signed  the  Europe
Agreement with the Czech Republic in October 1993.

Article  64(4)(a)  of  the  Agreement  provides  that  the  Parties  recognise  that
during  the  first  five  years  after  the  entry  into  force  of  this  Agreement,  any
public aid granted by the Czech Republic shall be assessed taking into account
the fact that the Czech Republic shall be regarded as an area identical to those
areas  of  the  Community  described  in  Article  92  (3)  (a)  of  the  Treaty
establishing the European Economic Community.

Article 4(2) of the Implementing Rules for the application of the provisions on
State Aid of the Europe Agreement, as adopted by the Decision No.1/1998 of
the  EU  Czech  Association  Council  of  24  June  1998,  provides  that  the
monitoring authorities shall  jointly evaluate  the maximum aid  intensities  and
specific regional coverage of the areas eligible for national regional aid. They
shall  submit  a  joint  proposal  to  the  Association  Committee  which  shall
establish a decision to this effect.

Article 2 of the decision No 3/2001 of the EU – Czech Republic Association
Council in 8 March 2001 with regard to the extension for a further period of
five  years  of  Czech  Republic  as  an  area  identical  to  those  areas  of  the
Community  described  in  the  Article  87(3)(a)  of  the  Treaty  obliged  Czech
Republic  within  six  months  of  the  date  of  the  adoption  of  the  decision  to

3

OJ C […] of […], p. […]

5

                                                
(5) 

(6) 

(7) 

(8) 

submit the GDP per capita figures which have been harmonised at NUTS level
II to the European Commission;

The  Czech  Republic  State  aid  monitoring  authority  and  the  European
Commission  jointly  evaluated  the  eligibility  of  the  regions  as  well  as  the
maximum aid intensities in relation thereto in order to draw up the regional aid
map on the basis of the Community guidelines on national regional aid4;

According  to  Article  4(2)  of  the  Implementing  rules,  in  conjunction  with
Article  2,  third  sentence  of  Decision  No  3/2001  of  the  EU-Czech-Republic
Association  Council,  a  joint  proposal  shall  be  submitted  to  the  Association
Committee, which shall take a decision to this effect;

According to the Community guidelines on national regional aid, the eligibility
conditions for the derogation under Article 87(3)(a) of the Treaty are fulfilled if
the  region,  being  a  NUTS  level  II  geographical  unit,  has  a  per  capita  gross
domestic product, measured in purchasing power standards  (GDP/PPS), of less
than 75% of the Community average;

In the case of regions falling under Article 87(3)(a) the intensity of regional aid
must  not  exceed  50%  net  grant  equivalent  (NGE),  except  in  the  outermost
regions, where  it may be as much  as 65%  NGE.  In  the  NUTS  level  II  regions
eligible under Article 87(3)(a) whose per capita GDP/PPS is greater than 60% of
the Community average, the intensity of regional aid must not exceed 40% NGE,
except in the outermost regions, where it may be as high as 50% NGE;

(9) 

The  GDP/PPS  of  each  region  and  the  Community  average  to  be  used  in  the
analysis must relate to the average of the last three years for which statistics are
available;

(10)  Within the limit of 75% NGE, the above mentioned aid intensity ceilings may be
raised by 15 percentage points gross grant equivalents (GGE) in the case of aid
granted to small and medium-sized enterprises5 in Article 87(3)(a) regions;

(11)  Also according to the Community guidelines on national regional aid, a national
ceiling on population coverage for regions eligible under Article 87(3)(c) of the
Treaty  is  set,  in  each  Member  State,  at  a  sufficient  level  to  include  all  the
regions, which have just lost their Article 87(3)(a) status and areas with a low
population density. For parts of the regions that lose their Article 87(3)(a) status
as a result of the review of the regional aid map and that acquire Article 87(3)(c)
status, the Commission could accept, during a transitional period of four years, a
progressive reduction of the aid intensity ceilings for which such regions would
have  been  eligible  under  Article  87(3)(a),  at  a  linear  or  faster  rate,  until  the
intensity ceiling corresponding to their new status is reached;

(12) 

In the case of regions falling under Article 87(3)(c), the ceiling on regional aid
must not exceed 20% NGE, except in the low population  density regions or in
the outermost regions, where it may be as high as 30% NGE. In regions eligible

4

5

OJ C 74 of 10.3.1998, p. 9.
OJ L 107 of 30.4.1996, p. 4.

6

                                                
under  Article  87(3)(c),  which  have  both  a  higher  per  capita  GDP/PPS  and  a
lower unemployment rate than the respective Community average, the intensity
of regional aid must not exceed 10% NGE except in the low population density
regions  or  in  the  outermost  regions,  where  it  may  be  as  high  as  20%  NGE.
Exceptionally  in  the  case  of  regions  subject  to  the  said  ceiling  of  10%  NGE,
higher  intensities  not  exceeding  the  normal  ceiling  of  20%  NGE  may  be
approved  for  regions  (corresponding  to  NUTS level  III  or  smaller)  adjoining  a
region with Article 87(3)(a) status. Again, the GDP/PPS of each region and the
Community average to be used in the analysis must relate to the average of the
last three years for which statistics are available;

(13)  Within the limit of 30% NGE, the above mentioned aid intensity ceilings may be
raised  by  10  percentage  points  GGE  in  the  case  of  aid  granted  to  small  and
medium-sized enterprises6 in Article 87(3)(c) regions;

(14)  All  the  above  aid  intensity  ceilings  constitute  upper  limits  which  apply  to  the
total  aid  whenever  assistance  is  granted  concurrently  under  several  regional
schemes,  and  regardless  of  whether  it  comes  from  local,  regional,  national  or
Community  sources.  Beneath  these  upper  limits,  regional  aid  intensity  ceilings
are to be adjusted to reflect the seriousness and intensity of the regional problems
addressed;  the  seriousness  and  intensity  of  the  regional  problems  must  be
assessed  within  the  broader  context  of  the  Community  and  of  the  countries
with which Europe Agreements have been concluded;

(15)  The Czech Republic consists of eight NUTS level II regions. According to the
statistical data available for the years 1998-2000, one of these (Praha) has a per
capita  GDP/PPS  that  exceeds  75%  of  the  Community  average.  However,  the
Praha region, which is also a single NUTS level III region, had been eligible for
Article  87(3)(a)  until  31  December  2001,  and  can  therefore  be  regarded  as  a
region that just lost its Article 87(3)(a) status. According to the same statistical
data,  the  seven  other  Czech  NUTS  level  II  regions  all  have  a  per  capita
GDP/PPST that is lower than 60% of the Community average;

(16) 

In  the  proposed  regional  aid  map,  all  NUTS  level  II  regions  but  Praha  are
therefore granted the Article 87(3)(a) status. The regional aid intensities ceilings
are set at the following levels:

50%  NGE 
Moravskoslezsko,

in 

the  NUTS 

level  II  regions  of  Střední  Čechy  and

49% NGE in the NUTS level II regions of Severozápad and Střední Morava,

48% NGE in the NUTS level II regions of Severovýchod and Jihovýchod, and

46%  NGE 

in 

the  NUTS 

level 

II 

region 

of 

Jihozápad.

The above aid intensities are raised by 15 percentage points GGE in the case
of aid granted to small and medium-sized enterprises;

6

OJ L 107 of 30.4.1996, p. 4.

7

                                                
(17)  As a former Article 87(3)(a) region, the NUTS level II region of Praha is granted
the Article 87(3)(c) status. Since the Czech Republic does not wish to make use
of  the  ity  to  make  use  of  the  possibility  to  apply  a  transitional  period  during
which aid intensities can be progressively reduced, and considering that Praha is
also a NUTS level III region that adjoin regions with an Article 87(3)(a) status,
the regional aid intensity ceiling is set at 20% NGE. This ceiling is raised by 10
gross  percentage  points  in  the  case  of  aid  granted  to  small  and  medium-sized
enterprises;

(18)  The  maximum  aid  intensities  applicable  in  each  of  the  above  mentioned
regions,  as  jointly  evaluated  by  the  Czech  Republic  State  aid  monitoring
authority  and  the  European  Commission,  are  in  conformity  with  the
requirements set by the Community guidelines on national regional aid.

HAS DECIDED AS FOLLOWS:

Sole Article

The  position  to  be  taken  by  the  Community  within  the  Association  Committee
established  by the  Europe  Agreement  between  the  European  Communities  and  their
Member States, of the one part, and the Czech Republic, of the other part, with regard
to  the  adoption  of  the  regional  aid  map  shall  be  based  on  the  draft  decision  of  the
Association Committee annexed to this Decision.

Done at Brussels,

For the Council
The President

8

ANNEX

ASSOCIATION

BETWEEN THE

EUROPEAN UNION

AND CZECH REPUBLIC

__________

- The Association Committe -

DECISION No …/2002 OF THE ASSOCIATION COMMITTE

BETWEEN THE EUROPEAN COMMUNITIES

AND THEIR MEMBER STATES, OF THE ONE PART,

AND CZECH REPUBLIC, OF THE OTHER PART,

of

adopting a regional aid map on the basis of which regional aid

granted by Czech Republic will be assessed

THE ASSOCIATION COMMITTEE,

Having  regard  to  the  Europe  Agreement  establishing  an  association  between  the
European  Communities  and  their  Member  States,  of  the  one  part,  ND  THE  Czech
Republic, of the other part, and in particular Article 64(4)(a) thereof;

Having  regard  to  Article  4(2)  of  the  Implementing  Rules  for  the  application  of  the
provisions on State aid of the Europe Agreement, as adopted by Decision No 1/98 of
the EU-Czech Republic Association Council of 24 June 1998;

Having regard to decision No 3/2001 of the EU-Czech Republic Association Council
of 8 March 2001 with regard to the extension for a further period of five years of the
Czech  Republic  as  an  area  identical  to  those  areas  of  the  Community  described  in
Article 87(3)(a) of the Treaty establishing the European Community and in particular
its Article 2, third sentence;

Whereas:

(1)

(2)

Article  2  of  the  decision  No  3/2001  obliged  the  Czech  Republic  within  six
months  of  the  date  of  the  adoption  of  the  decision  to  submit  the  GDP  per
capita figures which have been harmonised at NUTS level II to the European
Commission;

the  Czech  Republic  State  aid  monitoring  authority  and  the  European
Commission  jointly  evaluated  the  eligibility  of  the  regions  as  well  as  the

9

(3)

(4)

(5)

(6)

(7)

(8)

(9)

maximum aid intensities in relation thereto in order to draw up the regional
aid map on the basis of the Community guidelines on national regional aid 7;

according  to  Article  4(2)  of  the  Implementing  Rules,  in  conjunction  with
Article  2,  third  sentence  of  Decision  No  3/2001  of  the  EU-Czech-Republic
Association  Council,  a  joint  proposal  shall  be  submitted  to  the  Association
Committee, which shall take a decision to this effect;

according  to  the  Community  guidelines  on  national  regional  aid,  the
eligibility conditions for the derogation under Article 87(3)(a) of the Treaty are
fulfilled if the region, being a NUTS level II geographical unit, has a per capita
gross domestic product, measured in purchasing power standards (GDP/PPS),
of less than 75% of the Community average;

in the case of regions falling under Article 87(3)(a) the intensity of regional aid
must  not  exceed  50%  net  grant  equivalents  (NGE),  except  in  the  outermost
regions, where it may be as much as 65% NGE. In the NUTS level II regions
eligible under Article 87(3)(a) whose per capita GDP/PPS is greater than 60%
of the Community average, the intensity of regional aid must not exceed 40%
NGE, except in the outermost regions, where it may be as high as 50% NGE;

the  GDP/PPS  of  each  region  and  the  Community  average  to  be  used  in  the
analysis must relate to the average of the last three years for which statistics are
available;

within the limit of 75% NGE, the above mentioned aid intensity ceilings may
be raised by 15 percentage points gross grant equivalent (GGE) in the case of
aid granted to small and medium-sized enterprises8 in Article 87(3)(a) regions;

also according to the Community guidelines on national regional aid, a national
ceiling on population coverage for regions eligible under Article 87(3)(c) of the
Treaty  is  set,  in  each  Member  State,  at  a  sufficient  level  to  include  all  the
regions which have just lost their Article 87(3)(a) status and areas with a low
population  density.  For  parts  of  the  regions  that  lose  their  Article  87(3)(a)
status as a result of the review of the regional aid map and that acquire Article
87(3)(c)  status,  the  Commission  could  accept,  during  a  transitional  period  of
four years, a progressive reduction of the aid intensity ceilings for which such
regions  would  have  been  eligible  under  Article  87(3)(a),  at  a  linear  or  faster
rate, until the intensity ceiling corresponding to their new status is reached;

in the case of regions falling under Article 87(3)(c), the ceiling on regional aid
must not exceed 20% NGE, except in the low population density regions or in
the outermost regions, where it may be as high as 30% NGE. In regions eligible
under  Article  87(3)(c)  which  have  both  a  higher  per  capita  GDP/PPS  and  a
lower unemployment rate than the respective Community average, the intensity
of regional aid must not exceed 10% NGE except in the low population density
regions  or  in  the  outermost  regions,  where  it  may  be  as  high  as  20%  NGE.

7

8

OJ C 74 of 10.3.1998, p. 9.
OJ L 107 of 30.4.1996, p. 4.

10

                                                
(10)

(11)

(12)

Exceptionally  in  the  case  of  regions  subject  to  the  said  ceiling  of  10%  NGE,
higher  intensities  not  exceeding  the  normal  ceiling  of  20%  NGE  may  be
approved for regions (corresponding to NUTS level III or smaller) adjoining a
region with Article 87(3)(a) status. Again, the GDP/PPS of each region and the
Community average to be used in the analysis must relate to the average of the
last three years for which statistics are available;

within the limit of 30% NGE, the above mentioned aid intensity ceilings may
be raised by 10 percentage points GGE in the case of aid granted to small and
medium-sized enterprises9 in Article 87(3)(c) regions;

all the  above  aid  intensity  ceilings  constitute  upper  limits  which  apply  to  the
total  aid  whenever  assistance  is  granted  concurrently  under  several  regional
schemes, and regardless of whether it comes from  local,  regional,  national  or
Community sources. Beneath these upper limits, regional aid intensity ceilings
are  to  be  adjusted  to  reflect  the  seriousness  and  intensity  of  the  regional
problems  addressed;  the  seriousness  and  intensity  of  the  regional  problems
must  be  assessed  within  the  broader  context  of  the  Community  and  of  the
countries with which Europe Agreements have been concluded;

The  Czech  Republic  consists  of  eight  NUTS  level  II  regions.  According  to
the statistical data available for the years 1998-2000, one of these (Praha) has
a per capita GDP/PPS that exceeds 75% of the Community average. However,
the Praha region, which is also a single NUTS level III region, had been eligible
for Article 87(3)(a) until 31 December 2001, and can therefore be regarded as a
region that just lost its Article 87(3)(a) status. According to the same statistical
data,  the  seven  other  Czech  NUTS  level  II  regions  all  have  a  per  capita
GDP/PPST that is lower than 60% of the Community average;

(13)

In  the  proposed  regional  aid  map,  all  NUTS  level  II  regions  but  Praha  are
therefore  granted  the  Article  87(3)(a)  status.  The  regional  aid  intensities
ceilings are set at the following levels:

in 
50%  NGE 
Moravskoslezsko,

the  NUTS 

level  II  regions  of  Střední  Čechy  and

49% NGE in the NUTS level II regions of Severozápad and Střední Morava,

48% NGE in the NUTS level II regions of Severovýchod and Jihovýchod, and

46% NGE in the NUTS level II region of Jihozápad.

The above aid intensities are raised by 15 percentage points GGE in the case
of aid granted to small and medium-sized enterprises;

(14)

as  a  former  Article  87(3)(a)  region,  the  NUTS  level  II  region  of  Praha  is
granted the Article 87(3)(c) status. Since the Czech Republic does not wish to
make  use  of  the  possibility  to  apply  a  transitional  period  during  which  aid
intensities  can  be  progressively  reduced,  and  considering  that  Praha  is  also  a

9

OJ L 107 of 30.4.1996, p. 4.

11

                                                
NUTS level III region which adjoins regions with an Article 87(3)(a) status, the
regional  aid  intensity  ceiling  is set  at  20% NGE.  This  ceiling  is  raised by  10
gross percentage points in the case of aid granted to small and medium-sized
enterprises;

(15)

the  maximum  aid  intensities  applicable  in  each  of  the  above  mentioned
regions,  as  jointly  evaluated  by  the  Czech  Republic  State  aid  monitoring
authority  and  the  European  Commission,  are  in  conformity  with  the
requirements set by the Community guidelines on national regional aid.

HAS DECIDED AS FOLLOWS:

Article 1

The NUTS  level  II  regions of  Střední Čechy, Moravskoslezsko, Severozápad, Střední
Morava, Severovýchod, Jihovýchod, and Jihozápad shall be regarded as  areas eligible
for  regional  aid,  identical  to  those  areas  in  the  Community  described  in  Article
87(3)(a) of the Treaty establishing the European Community.

The NUTS level II region of Praha shall be regarded as an area eligible for regional
aid,  identical  to  those  areas  in  the  Community  described  in  Article  87(3)(c)  of  the
Treaty.

Article 2

The regional aid intensity ceiling shall be limited to 20% net  grant equivalent in the
NUTS level II region of Praha, to 50% in the NUTS level II regions of Střední Čechy
and Moravskoslezsko, to 49% in the NUTS level II regions of Severozápad and Střední
Morava, to 48% in the NUTS level II regions of Severovýchod and Jihovýchod and to
46% in the NUTS level II region of Jihozápad.

The regional aid intensity ceilings referred to under Article 2, paragraph 1, may be raised
by 10 percentage  points  gross grant equivalent in the case  of aid  granted to small  and
medium-sized enterprises10 in the NUTS level II region of Praha and by 15 percentage
points  gross  grant  equivalents  in  the  NUTS  level  II  regions  of  Střední  Čechy,
Moravskoslezsko,  Severozápad,  Střední  Morava,  Severovýchod,  Jihovýchod,  and
Jihozápad.

The regional aid intensity  ceilings referred to under Article  (2), paragraphs  1 and 2,
shall  constitute  upper  limits  which  apply  to  the  total  aid  whenever  assistance  is
granted  concurrently  under  several  regional  schemes,  and  regardless  of  whether  it
comes from local, regional, national or Community sources.

10

OJ L 107 of 30.4.1996, p. 4.

12

                                                
Article 3

This Decision shall  enter into force on  the  day of  its  adoption.  It  shall expire on 31
December  2006  or  the  date  of  Czech  Republic’s  accession  to  the  European  Union,
whichever comes earlier.

Done at Brussels,

For the Association Committee
The President

13