Commission Regulation (EC) No 1628/2006 of 24 October 2006 on the application of Articles 87 and 88 of the Treaty to national regional investment aid   (Text with EEA relevance)
Date: 2006-10-24
Institutions: European Commission
Subjects: State aid, aid system, exchange of information, investment aid, regional aid

1.11.2006

EN

Official Journal of the European Union

L 302/29

COMMISSION REGULATION (EC) No 1628/2006

of 24 October 2006

on the application of Articles 87 and 88 of the Treaty to national regional investment aid

(Text with EEA relevance)

(3)

(4)

(5)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty
Community,

establishing the European

Having regard to Council Regulation (EC) No 994/98 of 7 May
1998 on the application of Articles 92 and 93 of the Treaty
establishing the European Community to certain categories of
horizontal State aid (1), and in particular points (a)(i) and (b) of
Article 1(1) thereof,

Having published a draft of this Regulation (2),

After consulting the Advisory Committee on State Aid,

Whereas:

(1)

(2)

Regulation (EC) No 994/98 empowers the Commission
to declare, in accordance with Article 87 of the Treaty,
that under certain conditions aid that complies with the
map approved by the Commission for each Member
State for the grant of regional aid is compatible with
the common market and is not subject to the notification
requirement of Article 88(3) of the Treaty.

in particular

The Commission has applied Articles 87 and 88 of the
Treaty to regional
investment aid schemes in assisted
areas in numerous decisions and has also stated its
in the guidelines on national
policy,
regional aid for 2007 to 2013 (3) as well as
in
Commission Regulation (EC) No 70/2001 of 12
January 2001 on the application of Articles 87 and 88
of the EC Treaty to State aid to small and medium-sized
enterprises (4). In the light of the Commission’s consi-
derable experience in applying Articles 87 and 88 of
the Treaty to regional
investment aid and in the light
of the guidelines on national regional aid issued by the
Commission on the basis of those provisions, it is appro-

(1) OJ L 142, 14.5.1998, p. 1.
(2) OJ C 120, 20.5.2006, p. 2.
(3) OJ C 54, 4.3.2006, p. 13.
(4) OJ L 10, 13.1.2001, p. 33. Regulation as amended by Regulation

(EC) No 1040/2006 (OJ L 187, 8.7.2006, p. 8).

priate, with a view to ensuring efficient supervision
administration without weakening
simplifying
and
Commission monitoring,
the Commission should
that
make use of the powers conferred by Regulation (EC)
No 994/98.

By addressing the handicaps of
the disadvantaged
regions, national regional aid promotes the economic,
social and territorial cohesion of Member States and
the Community as a whole. National regional investment
aid is designed to assist the development of the most
disadvantaged regions by supporting investment and
job creation in a sustainable context.
It promotes the
expansion, rationalisation, modernisation and diversifi-
activities of undertakings
cation of
located in the less-favoured regions,
in particular by
encouraging firms to set up new establishments there.

economic

the

In order to determine whether or not aid is compatible
with the common market pursuant to this Regulation, it
is necessary to take into consideration the aid intensity
and thus the aid amount expressed as a grant equivalent.
The calculation of the grant equivalent of aid payable in
several
instalments requires the use of market interest
rates prevailing at the time of grant. With a view to a
uniform, transparent, and simple application of the State
aid rules, the market rates for the purposes of this Regu-
lation should be deemed to be the reference rates which
are periodically fixed by the Commission on the basis of
objective criteria and published in the Official Journal of
the European Union and on the Internet.

In order to ensure transparency and effective monitoring,
this Regulation should apply only to regional investment
aid schemes which are transparent. These are aid schemes
in which it is possible to calculate precisely the gross
grant equivalent as a percentage of eligible expenditure
ex ante without a need to undertake a risk assessment (for
example grants, interest rate subsidies and capped fiscal
measures). Public loans should be considered to be trans-
parent provided that they are backed by normal security
and do not involve abnormal risk and are therefore not
considered to contain a state guarantee element.
In
principle, aid schemes
involving state guarantees or
public loans with a state guarantee element should not
be considered as transparent. However, such aid schemes
should be considered as transparent if, before the imple-
the methodology used to
mentation of
calculate the aid intensity of
the state guarantee has
been accepted by the Commission following notification
to the Commission after adoption of this Regulation. The

the scheme,

L 302/30

EN

Official Journal of the European Union

1.11.2006

methodology will be assessed by the Commission in
accordance with the Notice on the application of
Article 87 and 88 of the EC treaty to State aid in the
Forms of Guarantees (5). Public participation and aid
should not be
comprised in risk capital measures
considered as transparent aid. Regional aid schemes
which are not transparent should always be notified to
the Commission. Notifications
non-transparent
regional aid schemes will be assessed by the Commission
in particular in the light of the criteria set out in the
Guidelines on national regional aid for 2007 to 2013.

of

(9)

(6)

(7)

(8)

This Regulation should also apply to ad hoc aid, that is
to say, individual aid that is not awarded on the basis of
an aid scheme, if the ad hoc aid is used to supplement
regional
aid granted on the basis of a transparent
investment aid scheme and the ad hoc component
does not exceed 50 % of the total aid to be granted
for the investment. It should be recalled that individual
aid to small and medium-sized enterprises granted
outside of any aid scheme in accordance with Article
3(1) of Regulation (EC) No 70/2001 is compatible with
the common market within the meaning of Article 87(3)
of
the Treaty and is exempted from the notification
requirement of Article 88(3) of the Treaty.

Any aid that meets all the requirements of this Regu-
lation should be
exempted from the notification
requirement. Regional aid schemes exempted under this
Regulation should contain an express reference to this
Regulation.

This Regulation should not apply to certain sectors in
which special rules apply. Aid awarded in these sectors
remains subject to prior notification to the Commission
in accordance with Article 88(3) of the Treaty. This is the
case for the coal and steel industry, the synthetic fibres
and shipbuilding sectors, fisheries and aquaculture. In the
agricultural sector, this Regulation should not apply to
activities linked to the primary production of agricultural
products listed in Annex I to the Treaty. It should apply
to the processing and marketing of agricultural products
with the exception of the manufacture and marketing of
products which imitate or substitute for milk and milk
products, as referred to in Article 3(2) of Council Regu-
lation (EEC) No 1898/87 of 2 July 1987 on the
protection of designations used in marketing of milk
and milk products (6). On-farm activities necessary for
preparing a product for the first sale, as well as the
first sale to resellers and processors should not be
regarded as processing or marketing in this respect.
This Regulation should ensure that the aid intensities in
favour of undertakings processing and marketing agri-

(5) OJ C 71, 11.3.2000, p. 14.
(6) OJ L 182, 3.7.1987, p. 36. Regulation as last amended by 1994 Act

of Accession.

in Article 28(3) of Council
cultural products set out
Regulation (EC) No 1698/2005 of 20 September 2005
on support for rural development by the European Agri-
(EAFRD) (7) can
cultural Fund for Rural Development
always be attained.

specific

targeted at
activity within manufacturing or

The Commission has a consistently less favourable view
Investment aid
of aid targeted at particular sectors.
sectors of
schemes which are
economic
services
should not
therefore be covered by the exemption
from notification provided by this Regulation. However,
tourism
investment aid schemes aimed at
regional
activities
targeted at
should not be
specific sectors and should be exempt from the notifi-
cation requirement of Article 88(3) of
the Treaty,
provided that the aid awarded fulfils all the conditions
of this Regulation.

considered as

(10) Aid

to

small

enterprises

for
and medium-sized
consultancy and other services awarded in accordance
with Article 5(a) of Regulation (EC) No 70/2001 is
compatible with the
common market within the
meaning of Article 87(3) of the Treaty and is exempted
from the notification requirement of Article 88(3) of the
Treaty. Such aid should therefore not
fall within the
scope of this Regulation.

(11)

(12)

In accordance with the established practice of
the
Commission, and with a view to better ensuring that
amount
aid is proportionate
necessary, thresholds should be expressed in terms of
aid intensities in relation to a set of eligible costs,
rather than in terms of maximum aid amounts.

and limited to the

It
is appropriate to establish further conditions that
should be fulfilled by any aid scheme or individual aid
exempted by this Regulation. Having regard to Article
87(3)(c) of
the Treaty, such aid should not normally
have the sole effect of continuously or periodically
reducing the operating costs which the beneficiary
would normally have to bear, and should be propor-
tionate to the handicaps that have to be overcome in
order to secure the socioeconomic benefits deemed to
be in the Community interest. It is therefore appropriate
this Regulation to regional aid
to limit
the scope of
investments within the
granted in relation to initial
meaning of
aid schemes
this Regulation. Regional
which provide for operating aid remain subject to the
notification requirements of Article 88(3) of the Treaty.
Aid to newly created small undertakings, other than
investment or consultancy aid, also remains subject to
the notification requirements of Article 88(3) of
the
Treaty.

(7) OJ L 277, 21.10.2005, p. 1.

1.11.2006

EN

Official Journal of the European Union

L 302/31

(13)

(14)

(15)

Since the Commission has to ensure that authorised aid
does not alter trading conditions in a way contrary to the
general interest, investment aid awarded in favour of a
beneficiary which is subject to an outstanding recovery
previous Commission decision
order
declaring the aid illegal and incompatible with the
common market, should be excluded from the scope of
this Regulation. Such aid therefore remains subject to the
notification requirements of Article 88(3) of the Treaty.

following

a

In order not to favour the capital factor of an investment
over the labour factor, provision should be made for the
possibility of measuring aid to investment on the basis of
either
costs of new
employment directly linked to the carrying-out of the
investment project.

investment

costs or

the

the

Large amounts of aid should remain subject to an indi-
vidual assessment by the Commission before they are put
into effect. Accordingly, aid amounts exceeding a certain
threshold granted to a single undertaking or estab-
lishment on the basis of an existing aid scheme should
be excluded from the exemption provided for in this
to the notification
Regulation and remain subject
requirements of Article 88(3) of the Treaty. In order to
prevent large investment projects being artificially divided
into sub-projects, a large investment project should be
considered to be a single investment project if the initial
investment is undertaken within a period of three years
by the same undertaking or undertakings and consists of
fixed assets combined in an economically indivisible way.
To assess whether an initial investment is economically
indivisible, the Commission will take into account the
technical,
the
immediate geographical proximity. The economic indivi-
sibility will be assessed independently from ownership.
This implies that to establish whether a large investment
the
project constitutes a single investment project,
assessment should be the same irrespective of whether
the project is carried out by one undertaking, by more
than one undertaking sharing the investment costs or by
separate
more undertakings bearing
(for
investments within the same investment project
example in the case of a joint venture).

functional

costs of

strategic

links

and

and

the

(17)

(18)

(19)

mation in writing should be taken to include commu-
nication by fax or e-mail.

thresholds

regional or

In view of the specificities of regional aid, this Regulation
should not exempt aid cumulated with other State aid,
including aid granted by national,
local
authorities or with Community assistance, in relation to
the same eligible costs, when such cumulation exceeds
the
fixed in this Regulation. Regional
investment aid exempted under this Regulation should
not be cumulated with de minimis support within the
meaning of Commission Regulation (EC) No 69/2001
of 12 January 2001 on the application of Articles 87
and 88 of the EC Treaty to de minimis aid (8) in respect of
the same eligible expenditure, if such cumulation would
result in an aid intensity exceeding that fixed by this
Regulation.

towards

This Regulation should not apply to aid to export-related
activities
third countries or Member States,
namely aid directly linked to the quantities exported, to
a distribution
the
network or
to other current expenditure linked to
export activities and aid contingent upon the use of
domestic over imported goods.

and operation of

establishment

In order to ensure transparency and effective monitoring
in accordance with Article 3 of Regulation (EC) No
994/98, it is appropriate to establish a standard format
to be used by Member States to provide the Commission
with summary information whenever, in accordance with
this Regulation, an aid scheme is implemented, or an ad
hoc aid is granted, with a view to publication in the
Journal of
Official
the European Union. For
the same
reasons,
it is appropriate to establish rules concerning
the records that Member States should keep regarding
the aid schemes exempted by this Regulation. In order
to facilitate administrative treatment and in view of the
wide
the
summary information should be provided in compu-
terised form. In order to improve the transparency of
regional aid in an enlarged Community, Member States
should publish the full
the aid scheme and
communicate to the Commission the internet address
of the publication.

availability of

the necessary

technology,

text of

(16)

It is important to ensure that regional aid produces a real
incentive effect and encourages investments which would
not otherwise be made in the assisted areas and acts as
an incentive to develop new activities. Before the start of
work on the aided project, the responsible authorities
should therefore confirm in writing that
the project
prima facie meets the conditions of eligibility. Confir-

(20)

In the light of the Commission's experience in this area,
and in particular the frequency with which it is generally
necessary to revise State aid policy, it is appropriate to
limit the period of application of this Regulation.

(8) OJ L 10, 13.1.2001, p. 30.

L 302/32

EN

Official Journal of the European Union

1.11.2006

(21)

This Regulation is without prejudice to any obligation on
a Member State to notify individual grants of aid under
obligations entered into in the context of other State aid
instruments, and in particular the obligation to notify, or
to inform the Commission of, aid to an undertaking
receiving
aid within the
and restructuring
meaning of the Community guidelines on State aid for
rescuing and restructuring firms in difficulty (9),

rescue

(a) aid to export related activities towards third countries or
Member States, namely aid directly linked to the quantities
exported, to the establishment and operation of a distri-
bution network or to the other current expenditure linked
to export activity;

(b) aid contingent upon the use of domestic in preference to

imported goods.

HAS ADOPTED THIS REGULATION:

Article 1

Scope

This Regulation shall

1.
regional
investment aid schemes which constitute State aid within the
meaning of Article 87(1) of the Treaty.

apply to transparent

It shall also apply to ad hoc aid which constitutes State aid
within the meaning of Article 87(1) of the Treaty if the ad
hoc aid is used to supplement aid granted on the basis of a
investment aid scheme, and the ad hoc
transparent regional
component does not exceed 50 % of
the total aid to be
granted for the investment.

Article 2

Definitions

For the purpose of this Regulation the following defi-

1.
nitions shall apply:

(a)

‘aid’ means any measure fulfilling all the criteria laid down
in Article 87(1) of the Treaty;

(b)

‘small and medium-sized enterprises (SMEs)’ means small
and medium-sized enterprises as defined in Annex I to
Regulation (EC) No 70/2001;

This Regulation shall not apply to aid in the following

2.
sectors:

(c)

‘initial investment’ means:

(a)

the fisheries and aquaculture sector;

(b) the shipbuilding sector;

(c)

the coal industry;

(d) the steel industry;

(e)

the synthetic fibres sector.

(i) an investment in material and immaterial assets relating
to the setting-up of a new establishment, the extension
of an existing establishment, diversification of
the
into new additional
output of
products or a fundamental change in the overall
production process of an existing establishment; or

an establishment

(ii) the acquisition of the capital assets directly linked to an
establishment, where the establishment has closed or
would have closed had it not been purchased, and
the assets are bought by an independent investor.

The sole acquisition of the shares of an undertaking
does not constitute initial investment;

It shall not apply to activities linked to the primary production
of agricultural products listed in Annex I to the Treaty. It shall
apply to the processing and marketing of agricultural products
to the exclusion of the manufacture and marketing of products
which imitate or substitute for milk and milk products, as
referred to in Article 3(2) of Regulation (EEC) No 1898/87.

(d)

‘ad hoc aid’ means individual aid that is not awarded on the
basis of an aid scheme;

(e)

‘material assets’ means assets relating to land, buildings and
plant/machinery;

This Regulation shall not apply to the following types of

3.
aid:

(9) OJ C 244, 1.10.2004, p. 2.

(f)

‘immaterial assets’ means assets entailed by the transfer of
technology through the
rights,
licences, know-how or unpatented technical knowledge;

acquisition of patent

1.11.2006

EN

Official Journal of the European Union

L 302/33

(g)

‘large investment project’ means an initial
investment in
capital assets with an eligible expenditure above EUR 50
million, calculated at prices and exchange rates on the date
when the aid is granted; a large investment project will be
considered to be a single investment project when the
initial
investment is undertaken within a period of three
years by the same undertaking or undertakings and consists
of
fixed assets combined in an economically indivisible
way;

(h)

‘aid intensity in present gross grant equivalent
means the discounted value of
percentage of the discounted value of the eligible costs;

(GGE)’
the aid expressed as a

(i)

(j)

(k)

(l)

regional

investment

aid schemes’ means
‘transparent
investment aid schemes in which it is possible
regional
to calculate precisely the Gross grant equivalent as a
percentage of eligible expenditure ex ante without need
(for example schemes
to undertake a risk assessment
which use grants,
rate subsidies, capped fiscal
measures);

interest

‘start of work’ means either the start of construction work
to order
the
or
equipment,
studies,
excluding
whichever is the earlier;

legally binding

commitment

preliminary

feasibility

first

‘job creation’ means a net increase in the number of annual
labour units (ALU) directly employed in a particular estab-
lishment compared with the average over the previous 12
months; ALU are the number of persons employed full
time in one year, part-time and seasonal work being ALU
fractions;

‘wage cost’ means the total amount actually payable by the
beneficiary of
the employment
the aid in respect of
concerned, comprising the gross wage, before tax, and
the compulsory contributions
security
charges;

such as

social

(m) ‘jobs directly created by an investment project’ means jobs
concerning the activity to which the investment relates and
created within three years of completion of the investment,
including jobs created following an increase in the utili-
sation rate of the capacity created by the investment;

(n)

‘agricultural product’ means:

(i) the products listed in Annex I of the Treaty, except
fishery and acquaculture products covered by Council
Regulation (EC) No 104/2000 (10);

(ii) products falling under CN codes 4502, 4503 and

4504 (cork products);

(o)

(p)

(q)

(iii) products intended to imitate or substitute milk and
milk products, as referred to in Article 3(2) of Regu-
lation (EEC) No 1898/87;

‘products intended to imitate or substitute milk and milk
products’ mean products which could be confused with
milk and/or milk products but whose composition differs
from such products in that they contain fat and/or protein
of non-milk origin with or without protein derived from
milk (‘products other than milk products’ as referred to in
Article 3(2) of Regulation (EEC) No 1898/87);

‘processing of agricultural products’ means any operation
on an agricultural product resulting in a product which is
also an agricultural product, except on-farm activities
necessary for preparing an animal or plant product for
the first sale;

‘marketing of an agricultural product’ means holding or
displaying with a view to sale, offering for sale, delivery
or any other manner of placing on the market, except the
first sale by a primary producer to resellers and processors
and any activity preparing a product for such first sale; a
shall only be
sale by a farmer
takes places in separate
considered as marketing if
premises reserved for that purpose;

to final consumers
it

(r)

‘tourism activities’ means the following business activities in
terms of NACE Rev. 1.1 (11):

(i) NACE 55: Hotels and restaurants;

(ii) NACE 63.3: Activities of

travel agencies and tour

operators, tourist assistance activities;

(iii) NACE 92: Recreational, cultural and sporting activities.

2.
Schemes which use public loans are considered as trans-
parent regional investment aid schemes within the meaning of
paragraph 1(i) if they are backed by normal security and do not
involve abnormal risk, and are therefore not considered to
contain a state guarantee element; schemes which use state
guarantees or public loans with a state guarantee element, are
considered as transparent if, before the implementation of the
scheme, the methodology to calculate the aid intensity of the
state guarantee has been accepted following notification to the
Commission after adoption of this Regulation. Public partici-
pations and aid comprised in risk capital measures shall not
be considered as transparent.

(10) OJ L 17, 21.1.2000, p. 22.

(11) Classification of Economic Activities in the European Community.

L 302/34

EN

Official Journal of the European Union

1.11.2006

Article 3

Conditions for exemption

1.
Transparent regional investment aid schemes fulfilling all
the conditions of this Regulation shall be compatible with the
common market within the meaning of Article 87(3) of the
Treaty and shall be exempt from the notification requirement
of Article 88(3) of the Treaty provided that:

(a) any aid awarded under

such a scheme fulfils all

the

conditions of this Regulation;

(b) the scheme contains an express reference to this Regulation,
citing its title and publication reference in the Official Journal
of the European Union.

Aid up to the amount determined in accordance with
2.
Article 7(e) awarded on the basis of schemes referred to in
paragraph 1 of
this Article shall be compatible with the
common market within the meaning of Article 87(3) of the
Treaty and shall be exempt from the notification requirement
of Article 88(3) of the Treaty provided that the aid awarded
directly fulfils all the conditions of this Regulation.

Ad hoc aid which is only used to supplement aid granted
3.
on the basis of transparent regional investment aid schemes and
which does not exceed 50 % of the total aid to be granted for
the investment, shall be compatible with the common market
within the meaning of Article 87(3) of the Treaty and shall be
exempt from the notification requirement of Article 88(3) of
the Treaty provided that the ad hoc aid awarded directly fulfils
all the conditions of this Regulation.

Article 4

Aid for initial investment

Aid for initial

1.
investment shall be compatible with the
common market within the meaning of Article 87(3) of the
Treaty and shall be exempt from the notification requirement
of Article 88(3) of the Treaty provided that:

(a)

the aid is granted in regions eligible for regional aid, as
determined in the approved regional aid map for
the
Member State concerned for the period 2007 to 2013; and

With the exception of aid granted in favour of large investment
projects and aid for the transport sector, the ceilings in point (b)
may be increased by 20 percentage points for aid for initial
investment awarded to small enterprises and by 10 percentage
points for aid awarded to medium-sized enterprises.

2.
In addition to the general conditions for exemption laid
down in this Regulation, aid for initial investment shall satisfy
the following specific conditions:

(a)

the investment must be maintained in the recipient region
for at least five years, or three years in the case of SMEs,
after the whole investment has been completed;

(b) to be eligible, immaterial assets must:

(i) be used exclusively in the establishment receiving the

regional aid;

(ii) be regarded as amortizable assets;

(iii) be purchased
conditions;

from third parties under market

(iv) be included in the assets of the firm and remain in the
establishment receiving the regional aid for at least five
years or three years in the case of SMEs;

(c) where the aid is calculated on the basis of material or
immaterial
investment costs, or of acquisition costs in
case of takeovers, the beneficiary must provide a financial
contribution of at least 25 % of the eligible costs, either
through its own resources or by external financing,
in a
form which is free of any public support. However, where
the maximum aid intensity approved under the national
regional
concerned,
increased in accordance with the second subparagraph of
paragraph 1,
the financial
if appropriate, exceeds 75 %,
contribution of the beneficiary is reduced accordingly.

the Member State

aid map for

(b) the aid intensity in present gross grant equivalent does not
exceed the regional aid ceiling which is in force at the time
the aid is granted for the region in which the investment
takes place, as determined in the approved regional aid map
for the Member State concerned for the period 2007 to
2013.

The condition in point (a) of the first subparagraph shall not
prevent
the replacement of plant or equipment which has
become out-dated within the period referred to in that point
due to rapid technological change, provided the economic
activity is retained in the region concerned for the minimum
period.

1.11.2006

EN

Official Journal of the European Union

L 302/35

The ceilings fixed in paragraph 1 shall apply to the
3.
intensity of the aid calculated either as a percentage of the
investment's eligible material and immaterial costs or as a
percentage of the estimated wage costs of the person hired,
calculated over a period of two years, for jobs directly created
by the investment project, or a combination thereof, provided
the aid does not exceed the most favourable amount resulting
from the application of either calculation.

instalments shall be discounted to its value at

4.
The eligible investment costs shall be discounted to their
value at the moment of granting of the aid. Aid payable in
the
several
moment of granting of the aid. The interest rate to be used
for discounting purposes shall be the reference rate applicable at
the time of grant. In cases where aid is awarded by means of tax
exemptions or reductions on future taxes due, subject to the
respect of a certain aid intensity defined in GGE, discounting of
aid tranches takes place on the basis of the reference rates
applicable at
the various times the tax advantages become
effective.

5.
In case of acquisition of an establishment, only the costs
of buying assets from third parties shall be taken into consid-
eration, provided the transaction has taken place under market
conditions. Where the acquisition is accompanied by other
initial
investment, the expenditure relating to the latter shall
be added to the cost of the purchase.

6.
Costs related to the acquisition of assets under lease, other
than land and buildings, shall only be taken into consideration
if the lease takes the form of financial leasing and contains an
obligation to purchase the asset at the expiry of the term of the
lease. For the lease of
the lease must
continue for at least five years after the anticipated date of
the completion of the investment project or three years in the
case of SMEs.

land and buildings,

In the transport sector, expenditure on the purchase of
7.
transport equipment (movable assets) shall not be eligible for
aid for initial investment.

Except

8.
the assets
in the case of SMEs and takeovers,
acquired shall be new. In the case of takeovers, assets for the
acquisition of which aid has already been granted prior to the
the full costs of
purchase shall be deducted. For SMEs,
investments in immaterial assets may also be taken into consi-
deration. For large undertakings, such costs are eligible only up
to a limit of 50 % of the total eligible investment expenditure
for the project.

(a)

jobs must be directly created by an investment project;

(b) the job creation must occur within three years of

the
completion of the investment and each job shall be main-
tained for a minimum period of five years, or three years in
the case of SMEs.

10.
By way of derogation from paragraph 1, the maximum
aid intensities for investments in the processing and marketing
of agricultural products may be increased to:

(a) 50 % of eligible investments

in regions eligible under
87(3)(a) of the Treaty and 40 % of eligible investments in
other regions eligible for regional aid, as determined in the
regional aid map approved for the Member States concerned
for the period 2007 to 2013, if the beneficiary is a small or
medium-sized enterprise;

(b) 25 % of eligible investments

in regions eligible under
87(3)(a) of the Treaty and 20 % of eligible investments in
other regions eligible for regional aid, as determined in the
regional aid map approved for the Member States concerned
for the period 2007 to 2013, if the beneficiary has less than
750 employees and/or less than EUR 200 million turnover,
calculated in line with Commission Recommendation
2003/361/EC (12), and if such beneficiary fulfils all other
conditions of that Recommendation.

Article 5

Necessity for the aid

This Regulation shall only exempt aid awarded under
1.
regional
investment aid schemes if, before the start of work
on the project, the beneficiary has submitted an application to
the national or regional authorities for aid and, in respect of
applications submitted from 1 January 2007,
the authority
responsible for administering the scheme has confirmed in
writing that, subject to the final outcome of a detailed verifi-
cation, the project meets the conditions of eligibility laid down
by the scheme. An express reference to both conditions must
also be included in the aid scheme. If work begins before the
conditions laid down in this Article are fulfilled, the whole
project shall not be eligible for regional aid.

Paragraph 1 shall not apply to aid schemes where a tax
2.
exemption or reduction is granted automatically to eligible
expenditure without any discretion on the part of the autho-
rities.

9. Where the aid is calculated on the basis of wage costs, the
following conditions shall be satisfied:

(12) OJ L 124, 20.5.2003, p. 36.

L 302/36

EN

Official Journal of the European Union

1.11.2006

Article 6

Cumulation

(g)

investment aid in favour of a beneficiary which is subject to
an outstanding
a previous
Commission decision declaring the aid illegal and incom-
patible with the common market.

recovery order

following

1.
The aid ceilings fixed in Article 4 shall apply to the total
amount of public support for the aided project regardless of
whether that support is financed from local, regional, national
or Community sources.

2.
Aid exempted by this Regulation shall not be cumulated
with any other State aid within the meaning of Article 87(1) of
the Treaty or with other Community or national funding,
in
relation to the same eligible costs,
if such cumulation would
result in an aid intensity exceeding that fixed by this Regulation.

3.
Regional investment aid exempted by this Regulation shall
not be cumulated with de minimis support within the meaning
of Regulation (EC) No 69/2001 in respect of the same eligible
expenditure, if such cumulation would result in an aid intensity
exceeding that fixed by this Regulation.

Article 7

Aid subject to prior notification to the Commission

The following aid shall not be exempted from notification
under this Regulation and shall remain subject to the notifi-
cation requirement of Article 88(3) of the Treaty:

(a) non-transparent regional investment aid schemes;

(b) regional aid schemes targeted at specific sectors of economic
activity within manufacturing
services. Regional
investment aid schemes aimed at tourism activities are not
considered as targeted at specific sectors;

or

(c) regional aid schemes which provide for operating aid;

(d) regional aid schemes which provide for aid other than
investment or consultancy aid to newly created small under-
takings;

(e) regional aid awarded in favour of large investment projects
on the basis of existing aid schemes if the total amount of
aid from all sources exceeds 75 % of the maximum amount
of aid an investment with eligible expenditure of EUR 100
million could receive, applying the standard aid ceiling in
force for large undertakings in the approved regional aid
map on the date the aid is to be granted;

(f) ad hoc regional aid, other than that exempted pursuant to
Article 3(1) of Regulation (EC) No 70/2001 and Article 3(3)
of this Regulation;

Article 8

Transparency and monitoring

1.
On implementation of an aid scheme or grant of ad hoc
aid exempted by this Regulation, Member States shall, within 20
working days, forward to the Commission, with a view to its
publication in the Official
the European Union, a
summary of the information regarding such aid in the form
laid down in Annex I. This shall be provided electronically in
computerised form.

Journal of

2. Whenever regional aid is granted on the basis of an
existing aid scheme for large investment projects which fall
below the threshold for individual notification laid down by
Article 7(e), the Member States shall, within 20 working days
starting from the day on which the aid is granted by the
competent authority, provide the Commission with the infor-
mation requested in the standard form laid down in Annex II,
electronically in computerised form. The Commission will make
the summary information available to the public through its
website (http://ec.europa.eu./comm/competition/).

the conditions

3. Member States shall maintain detailed records regarding
the aid schemes exempted by this Regulation and the individual
aid awarded under those schemes. Such records shall contain all
information necessary to establish that
for
exemption, as
laid down in this Regulation, are fulfilled,
including information on the status of any undertaking whose
entitlement to aid depends on its status as an SME. Member
States shall keep a record regarding an aid scheme, for 10 years
from the date on which the last individual aid was awarded
under such scheme. On written request,
the Member State
concerned shall provide the Commission, within a period of
20 working days or such longer period as may be fixed in
the request, with all the information which the Commission
considers necessary to assess whether the conditions of this
Regulation have been complied with.

4. Member States shall submit a report to the Commission
on the application of this Regulation in respect of each whole
or part calendar year during which this Regulation applies, in
the form laid down in Chapter III of Commission Regulation
(EC) No 794/2004 (13).

5. Member State shall publish the full text of the aid schemes
which fall within the scope of this Regulation and shall commu-
nicate to the Commission the internet address of the publi-
cation. That information shall also be contained in the annual
report submitted pursuant to paragraph 4. Projects for which
expenses were incurred before the date of publication of the aid
scheme shall not be eligible for regional aid.

(13) OJ L 140, 30.4.2004, p. 1.

1.11.2006

EN

Official Journal of the European Union

L 302/37

Article 9

Entry into force and period of validity

This Regulation shall enter into force on the 20th day
1.
Journal of the
following that of its publication in the Official
European Union. It shall apply to aid schemes which enter into
force, or are put into effect, after 31 December 2006.

into effect before the date of
provisions. Aid schemes put
entry into force of
this Regulation and aid granted under
those schemes, in the absence of a Commission authorisation
and in breach of the obligation to notify laid down in Article
88(3) of the Treaty, shall be compatible with the common
market within the meaning of Article 87(3) of the Treaty and
shall be exempted under this Regulation if they fulfil all the
conditions of this Regulation.

It shall remain in force until 31 December 2013.

2.
Notifications pending at the time of entry into force of
this Regulation shall be assessed in accordance with its

At the end of the period of validity of this Regulation, the
exemption for aid schemes exempted under this Regulation
shall expire at the date of expiry of the approved regional aid
maps.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels, 24 October 2006.

For the Commission

Neelie KROES
Member of the Commission

L 302/38

EN

Official Journal of the European Union

1.11.2006

ANNEX I

Information communicated by Member States regarding state aid granted under Commission Regulation (EC)
No 1628/2006 on the application of Articles 87 and 88 of the Treaty to national regional investment aid

(to be provided in computerised form, by electronic mail, to stateaidgreffe@ec.europa.eu)

1.11.2006

EN

Official Journal of the European Union

L 302/39

L 302/40

EN

Official Journal of the European Union

1.11.2006

ANNEX II

Form for the provision of summary information for aid for large investments projects where the aid does not
exceed the thresholds referred to in Article 7(e)

1. Aid in favour of (name of the undertaking(s) receiving the aid).

2. Aid scheme reference (Commission reference of the existing scheme or schemes under which the aid is awarded).

3. Public entity/entities providing the assistance (name and co-ordinates of the granting authority or authorities).

4. Member State where the investment takes place.

5. Region (NUTS 3 level) where the investment takes place.

6. Municipality (previously NUTS 5 level, now LAU 2) where the investment takes place.

7. Type of project (setting-up of a new establishment, extension of existing establishment, diversification of the output
of an establishment into new additional products or a fundamental change in the overall production process of an
existing establishment).

8. Products manufactured or services provided on the basis of the investment project (with PRODCOM/NACE nomen-

clature or CPA nomenclature for projects in the service sectors).

9. Short description of investment project.

10. Discounted eligible cost of investment project (in EUR).

11. Discounted aid amount (gross) in EUR.

12. Aid intensity (% in GGE).

13. Conditions attached to the payment of the proposed assistance (if any).

14. Planned start and end date of the project.

15. Date of award of the aid.