Report from the Commission - State Aid Scoreboard - Report on State aid granted by the EU Member States - Autumn 2009 Update - {SEC(2009) 1638}
Date: 2009-12-07
Institutions: European Commission
Subjects: EU Member State, European Commission, State aid, control of State aid, economic analysis, economic recession, report

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 7.12.2009 
COM (2009) 661 final 

REPORT FROM THE COMMISSION 

State Aid Scoreboard 

Report on State aid granted by the EU Member States 

- Autumn 2009 Update - 

{SEC(2009) 1638} 

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TABLE OF CONTENTS 

Introduction ................................................................................................................................ 3 

State aid in the context of the economic crisis ........................................................................... 3 

1. 

2. 

2.1. 

2.2. 

3. 

3.1. 

3.2. 

3.3. 

3.4. 

4. 

4.1. 

4.2. 

State aid in 2008........................................................................................................... 4 

Trends and patterns of state aid expenditure in the Member States............................. 4 

Trend of levels of State aid to industry and services ................................................... 6 

State aid earmarked for horizontal objectives of common interest.............................. 7 

State aid in the context of the financial and economic crisis ....................................... 7 

The Commission's guidance in crisis cases.................................................................. 7 

The Commission's intervention in crisis cases............................................................. 8 

Measures approved and take-up rate............................................................................ 9 

State aid granted during 2008 .................................................................................... 10 

Simplification of the State aid rules ........................................................................... 11 

A new architecture for State aid control .................................................................... 11 

Assessment of individual cases focused on a small number of large, potentially 
distortive aid............................................................................................................... 12 

4.3. 

Almost 19% of aid to industry and services is block exempted ................................ 12 

5. 

Enforcing the State aid rules ...................................................................................... 12 

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INTRODUCTION 

This autumn 2009 update of the State Aid Scoreboard (hereinafter "the Scoreboard") focuses 
on the State aid situation in the twenty-seven Member States for the year 2008. It provides an 
overview  over  aid  levels  and  the  objectives  pursed  by  aid  granted  by  Member  States.  The 
report includes a specific section on State aid granted to financial institutions in response to 
the financial and economic crisis. 

Furthermore,  the  Scoreboard  reports  on  progress  towards  delivering  a  comprehensive  and 
coherent reform package for State aid that began with the State Aid Action Plan (hereinafter 
"SAAP") in 2005. Finally, it provides achievements in the enforcement of State aid rules. 

This autumn's Scoreboard consists of two parts: This summary report on State aid granted by 
the EU Member States focuses on key facts, conclusions, trends and patterns with regard to 
State aid granted by Member States as well as key policy developments in the context of State 
aid  control.  Its  annex,  "Facts  and  figures  on  State  aid  in  the  EU  Member  States",  provides 
additional factual background. 
The EFTA Surveillance Authority (ESA) publishes an annual scoreboard1 on the volume of 
State aid granted in Iceland, Liechtenstein and Norway. 

State aid in the context of the economic crisis 

Over the past decade, the EU experienced steady economic growth (on average 1.5% of GDP) 
per annum. Between 2002 and 2007, the level of State aid to industry and services decreased 
annually  on  average  by  2%  and  stood  at  € 65 b illion  or  less  than  0.5%  of  GDP  in  2007.  In 
parallel, budget deficits came down to an average of 0.8% of GDP in 2007 – the best result 
for thirty years2. Unemployment fell during this period and stood at a  long-time low  of 7% 
EU-wide in 2008. 

The financial crisis abruptly ended GDP growth, low levels of State aid and decreasing budget 
deficits.  The  overall  level  of  State  aid  almost  quintupled  in  2008  compared  to  2007  and 
increased to 2.2% of GDP, almost exclusively as a result of crisis aid to the financial sector. 
Crisis aid to the real economy through the Temporary Framework3 started to be implemented 
by Member States only in 2009. It is therefore not covered by this report. Economic activity 
contracted and is expected to stabilise only in 2010. While early indicators show first signs of 
economic recovery, government deficits in the EU are forecast to average 6% of GDP in 2009 
and  around  7%  in  2010.  Budget  deficits  have  increased  substantially,  returning  to  levels 
known in 2000. Unemployment is expected to rise up to 10% or possibly higher and will be 
one of the key challenges in the years to come. 

When  inter-bank  lending  has  dried  up  in  September  2008,  Member  States  started  to  inject 
large amounts of aid to the banking sector in order to prevent a financial meltdown. Guarantee 
umbrellas,  followed  by  recapitalisation  measures  and  risk  shields  for  financial  institutions 
were put in place by Member States to ensure that lending to the economy can continue. In a 
next step, guided by the Temporary Framework, Member States started to provide additional 

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3 

http://www.eftasurv.int/information/sascoreboard/ 
Communication  from  the  Commission  to  the  European  Parliament  and  the  Council,  Long-term 
sustainability  of  public  finances  for  a  recovering  economy,  COM  (2009)  545  of  14/10/2009 
(http://ec.europa.eu/economy_finance/thematic_articles/article15994_en.htm) 
Temporary framework for State aid measures to support access to finance in the current financial and 
economic  crisis;  consolidated  version  OJ  C83  of  07.04.2009;  as  further  amended  by  OJ  C  261, 
31.10.2009, p. 2. 

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incentives  for  the  real  economy  to  continue  or  resume  investment.  The  European 
Commission's  State  aid  policy  was  one  of  the  key  factors  ensuring  that  this  –  overall 
successful  –  rescue  process  has  been  achieved  in  a  coordinated  way.  It  allowed  swift 
implementation  of  unprecedented  support  measures  and  ensured  at  the  same  time  that  the 
Single Market was kept intact. 

STATE AID IN 2008 

1. 
Total  State  aid4  granted  by  the  Member  States  amounted  to  € 279.6 billion  in  2008,  or  in 
relative terms, to 2.2% of EU-275 GDP. Crisis measures reported by Member States in 2008 
amounted to € 212.2 billion or 1.7% of GDP. In  2008, thirteen Member States implemented 
crisis  aid  in  favour  of  the  financial  sector  (Belgium,  Denmark,  Germany,  Ireland,  Spain, 
France, Latvia, Luxembourg, Netherlands, Portugal, Finland, Sweden and United Kingdom). 
By  end  October  2009,  all  EU-156  Member  States  and  Hungary,  Latvia  and  Slovenia  have 
financial crisis measures approved by the Commission. 

When excluding the crisis measures, total State aid amounted to around € 67.4 billion in 2008 
or  0.54%  of  EU-27  GDP.  Aid  to  industry  and  services  represents  78%  of  total  State  aid.  It 
amounted to € 52.9 billion or 0.42% of EU-27 GDP.  Aid to the coal industry is allocated to 
industry and services. It amounted to € 2.7 billion  or 4.1% of total aid. The remainder of aid is 
shared  between  agriculture  (€ 11.8 billion  or  17.5%   of  total  aid),  fisheries  (€ 0.2 billion  or 
0.4% of total aid), and transport7 (€ 2.4 billion or 3.6% of total aid). 

Aid to railways – which is for lack of comparable data not included in any of the above totals 
– is reported by Member States with € 46 billion or 0.4% of EU GDP 8. 
The five largest grantors account for € 40.5 billion or 60% of total aid 9. Germany accounted 
for  € 15.7 billion  or  23%  of  total  aid,  follo wed  by  France  (€ 10.3 billion;  15%),  Italy 
(€ 5.5 billion;  8%),  Spain  (€ 5.2 billion;  8%)  and  United  Kingdom  (€ 3.8 billion;  6%).  A 
completely  different  picture  emerges  when  looking  at  aid  in  percentage  of  GDP.  Hungary 
granted  aid  representing  2.4%  of  GDP,  followed  by  Malta  (2%),  Bulgaria  (1.3%),  Finland 
(1.1%) and Ireland (1.1%). 

2. 

TRENDS AND PATTERNS OF STATE AID EXPENDITURE IN THE MEMBER STATES 

The  Lisbon  European  Council  of  March  2000  called  on  the  Commission,  the  Council  and 
Member States to "further their efforts to … reduce the general level of State aid, shifting the 
emphasis  from  supporting  individual  companies  or  sectors  towards  tackling  horizontal 
objectives  of  Community  interest,  such  as  employment,  regional  development,  environment 
and  training  or  research".  Successive  European  Councils  have  since  repeated  the  call  for 
the  Commission 
targeted  aid”.  These  goals  were  underlined  by 
“less  and  better 

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The  total  covers  aid  to  manufacturing,  services,  coal,  agriculture,  fisheries  and  part  of  the  transport 
sector  but  excludes  aid  to  the  railway  sector,  aid  for  compensation  for  services  of  general  economic 
interest due to the lack of comparable data. Aid amounts refer to the aid element contained in a State aid 
measure  unless  stated  otherwise  (see  methodological  remarks  in  the  companion  Commission  Staff 
Working Document). 
EU-27 means all Member States of the EU. 
EU-15 comprises Member States that joined the EU before 2004. 
Excluding railways 
See also paragraph 2.3.5 of Commission's staff working document "Facts and figures on State aid in the 
EU Member States" 
Crisis measures excluded 

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Recommendation on the Broad Economic Policy Guidelines for 2005-2008. Furthermore, less 
and better-targeted aid was identified as one of the four guiding principles underpinning the 
Commission's State aid reform programme launched in 2005, the SAAP. 

Looking at the trend from a long-term perspective, the overall level of State aid in the 1980s 
was in the region of 2% of GDP, fell to just below 1% in the 1990s and came down to around 
0.5%  -  0.6%  of  GDP  in  the  years  2003  –  2007.  Due to  the  exceptional  crisis  measures,  the 
overall EU-27 aid level in 2008 went up to more than 2% of GDP. 
Figure 110: Total aid as % of GDP (EU-27; data as of 1992 

Total State aid as %  of GDP

P
D
G

f
o
%

2.5

2

1.5

1

0.5

0

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

State aid incl. crisis measures

State aid excl. crisis measures

The  decline  in  State  aid  expenditure  during  this  decade  and  until  2007  can  be  attributed  to 
three  main  factors:  first,  due  to  a  period  of  economic  growth  since  2000,  Member  States 
granted considerably less rescue and restructuring aid for ailing firms. Second, State aid to the 
coal  sector  showed  a  continued  downward  trend,  primarily  observed  in  Poland,  France, 
Germany and Spain. Third, pre-accession commitments and continued efforts after accession 
both contributed to the downward trend since the EU-1211 Member States continued to adjust 
their State aid policies and practices to the requirements under EU State aid law and policies. 

These efforts can be seen as the result of a general recognition that a high volume of State aid 
not  only  hindered  an  efficient  allocation  of  resources  but  also  rendered  the  economy  as  a 
whole less competitive. Work in this regard began already in the mid 1980s to make effective 
State aid control a key component of the Single Market Programme. State aid discipline was 
then  widened  and  strengthened  in  the  1990s  in  the  context  of  EMU  and  then  given  new 
impetus by the Lisbon Council in 2000 and the SAAP in 2005. The resulting reform package 
for  State  aid  focuses  largely  on  a  better  targeting  of  aid  while  ensuring  that  distortions  are 
kept to a minimum in order to maintain the functioning of the single market. 

Disregarding  the  exceptional  crisis  measures,  overall  aid  stands  at  0.54%  of  GDP 
(€ 67.4 billion),  still  within  the  average  of  the  pa st  years.  This  seems  to  indicate  that,  first, 
Member States continued to observe an overall state aid discipline when abstraction is made 
of  the  outbreak  of  the  financial  and  economic  crisis  in  2008.  Second,  the  strict  State  aid 
discipline  in  the  years  before  the  crisis  can  be  seen  as  an  important  contribution  that  made 

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Source: DG Competition; GDP figures: Eurostat 
EU-12 includes Member States which entered the EU in 2004 or thereafter. 

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swift, substantial and targeted response to the crisis possible without undermining the overall 
consensus that state aid should be used in a cautious, considered way where it is necessary to 
achieve  a  commonly  accepted  objective  and  proportionate  in  relation  to  the  problem  to  be 
addressed. 

Due  to  the  particularities  associated  with  aid  to  agriculture,  fisheries  and  transport,  the 
following  sections  on  levels  and  orientation  of aid  ( 2.1  and   2.2)  look  at  aid  to  industry  and 
services only. 

2.1. 

Trend of levels of State aid to industry and services 

In order to analyse the mid-term trend for state aid to industry and services, crisis measures 
are not taken into account here and will be separately discussed in chapter  3. 

For the EU as a whole, the trend on the level of aid granted to industry and services in the EU 
has  been  slightly  downward  when  comparing  the  two  consecutive  three-year  periods  2006-
2008 and 2003-2005. On average, aid expenditure amounted to € 52 billion or 0.42% of GDP 
in  2006-2008,  whereas  during  2003-2005  the  average  amounted  to  € 54 billion  or  0.46%  of 
GDP. This shows that, leaving the specific response to the financial and economic crisis aside, 
the majority of Member States has continued to contribute positively to the Council's call to 
reduce overall aid levels. 

A  majority  of  Member  States  (15)  were  able  to  keep  or  even  reduce  their  aid  levels  in  the 
period  2006-2008  as  compared  with  2003-2005.  Many  of  the  EU-12  countries  achieved 
significant reduction by 1% of GDP or even more. As a result, the average EU-12 expenditure 
reduced by almost half, i.e. from more than 1% of GDP in 2003-2005 to slightly above 0.5% 
in  2006-2008.  Some  EU-15  countries  were  also  able  to  reduce  aid  levels,  now  down  at 
approximately  0.4%  of  GDP  in  the  period  2006-200812,  i.e.  almost  equal  to  the  EU-27 
average. 

Despite the positive downward trend, some Member States increased aid expenditure in 2006-
200813compared  to  2003-2005.  Any  increase  can  largely  be  attributed  to  aid  in  favour  of 
horizontal  objectives,  mainly  for  regional  development,  environmental  protection,  research 
and development and employment. However, the increase has not caused yet a reverse of the 
overall long-term downward trend for the EU as a whole. 

The short-term evolution from 2007 to 2008 shows a moderate upward move in 2008. State 
aid expenditure for industry and services rose by approximately 0.04% of GDP. For instance, 
Germany increased regional investment aid in particular for the new Länder14 and Spain spent 
some more aid for environmental protection15. Poland substantially increased employment aid 
and  introduced  new  block  exempted  measures  representing  several  € 100 million  of 
expenditure16.  This  short-term  upward  evolution  shows  that  the  current  State  aid  control 
system  allows  Member  States  to  react  quickly  to  changing  economic  needs  without  further 
proceedings with the Commission. The main tools for Member States in this respect are block 
exempted  measures  and  approved  notified  aid  schemes  under  which  individual  aid  can  be 
granted to a large number of enterprises (for further details see chapter  4). 

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United Kingdom by € 0.2 billion, Germany by € 0.9 billion and Italy by € 0.4 billion 
Sweden by € 0.6 billion, Belgium by € 0.4 billion, France by € 0.3 billion 
In particular through the Investitionszulagengesetz 2007 (N357a/2006 and XR 6/2007) 
A large part can be attributed to NN 61/2004 Tax exemption on bio fuels. 
For instance XE 11/2004 Compensation des coûts liés à l'insertion des personnes handicapées dans les 
PME, N 575/2007 Secteur du charbon 2008-2015 

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2.2. 

State aid earmarked for horizontal objectives of common interest 

State  aid  for  horizontal  objectives,  i.e.  aid  that  is  not  granted  to  specific  sectors,  is  usually 
considered  as  being  better  suited  to  address  market  failures  and  thus  less  distortive  than 
sectoral and ad hoc aid. Research and Development and Innovation (hereinafter "R&D&I"), 
safeguarding  the  environment,  support  to  Small  and  Medium-Sized  Enterprises  (hereinafter 
"SME"),  employment  creation,  the  promotion  of  training  and  aid  for  regional  economic 
development are the most prominent horizontal objectives pursued with State aid. 

In  order  to  look  at  the  underlying  trend  regarding  the  effort  by  Member  States  to  re-orient 
'non-crisis'  aid  to  horizontal  objectives  of  common  interest,  crisis  cases  are  not  taken  into 
account for this analysis17. 

On this basis, aid earmarked for horizontal objectives amounted in 2008 to € 46.3 billion and 
accounted for roughly 88% of the total aid to industry and services. This is to be compared 
with  a  share  of  80%  in  2007,  74%  in  2004  and  around  50%  in  the  mid-Nineties.  The  three 
main  objectives  pursued  by  Member  States  in  2008  were  regional  aid  (26%),  aid  assessed 
under  the  environmental  aid  guidelines  (24%)18  and  aid  for  R&D&I  (16%).  The  underlying 
trend confirms the upward move on aid oriented to horizontal objectives. During the period 
2003-2005  on  average  74%  of  aid  were  earmarked  for  horizontal  objectives  while  during 
2006-2008  it  increased  to  85%.  A  similar  picture  emerges  when  looking  at  the  number  of 
Member  States  directing  90%  or  more  of  their  aid  to  industry  and  services  to  horizontal 
objectives of common interest. In 2008, this was the case for 17 Member States compared to 
17  in  200719  and  16  in  200620.  There  is  no  single  overriding  reason  or  pattern  for  this 
development. 

For the EU as a whole, aid for sectoral development including rescue and restructuring aid in 
2008 was lower compared to 2007 and stood at € 6.5  billion or 12% of total aid to industry 
and  services21.  Outside  the  context  of  the  economic  and  financial  crisis,  rescue  and 
restructuring  aid  amounted  in  2008  to  just  € 557 million,  compared  to  an  annual  average  of 
€ 3.5 billion in the period 2003-2005 and  of € 872 million in the period 2006-2008. 

Overall, the long-term trend shows that Member States continue to direct a high level of aid 
towards  horizontal  objectives.  In  particular,  all  EU-12  Member  States  are  progressively 
redirecting aid towards horizontal objectives. 

3. 

STATE AID IN THE CONTEXT OF THE FINANCIAL AND ECONOMIC CRISIS 

3.1. 

The Commission's guidance in crisis cases 

Following  the  deepening  of  the  financial  crisis  in  the  autumn  of  2008,  the  Commission 
provided guidance in the form of Communications on the design and implementation of State 

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If one were to include crisis measures, the share of horizontal aid would drop to 17.5%. 
Two distinct groups of cases fall in the category environmental aid and energy saving: The first group 
of cases pursues a direct benefit to environment. The second group comprises reductions or exemption 
from environmental taxes. For this second group of cases, aid expenditure cannot be taken as a proxy 
for measuring the environmental benefit as this benefit us pursed by the tax but not by the exemptions 
thereof. For further details, see Spring 2008 Scoreboard, COM (2008) 304 of 21 May 2008. 
See Autumn 2008 Scoreboard, COM (2008) 751 of 17 November 2008, p. 30 
See Autumn 2007 Scoreboard, COM (2007) 791 of 13 December 2007, p. 22 
These percentages exclude those measures with a horizontal objective that are nevertheless earmarked 
for the manufacturing and services sectors. 

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aid  in  favour  of  banks22.  In  these  Communications,  the  Commission  recognised  that  the 
severity of the crisis justified the grant of aid on the basis of Article 87(3)(b) EC and set out a 
coherent framework for the provision by Member States of public guarantees, recapitalisation 
measures  and  impaired  asset  relief,  whether  to  individual  banks  or  as  part  of  a  national 
scheme.  The  primary  rationale  of  the  guidance  in  these  Communications  is  to  ensure  that 
emergency measures for reasons of financial stability guarantee a level playing-field between 
banks  located  in  different  Member  States  as  well  as  between  banks  who  receive  public 
support and those who do not. State aid control by the Commission aims to minimise negative 
spill-over of public interventions between Member States, between beneficiaries of aid with 
different risk profiles, and between aid beneficiaries and banks that do not benefit from State 
aid, while facilitating the achievement of the objectives of the schemes. 
The European Council23 has reaffirmed its commitment to restoring confidence and the proper 
functioning  of  the  financial  market  and  stressed  that  policy  measures  at  EU  level  must  be 
consistent with single-market principles, ensure a level playing field and take into account a 
credible  exit  strategy.  This  process  implies,  on  one  hand,  major  restructuring  of  basically 
distressed banks and, on the on the other hand, the return path to normal market conditions of 
fundamentally sound banks. Similarly, the underlying principles apply to companies operating 
in the "real" economy facing structural problems which will need to undertake restructuring 
measures in order to restore the long-term viability. 

included  detailed  summaries  of 

The Commission provided a comprehensive overview on its action regarding State aid in the 
context  of  the  financial  and  economic  crisis  in  a  special  scoreboard  edition  published  this 
spring24.  This 
the 
Recapitalisation  Communication,  the  Temporary  Framework  for  the  real  economy,  the 
Impaired  Assets  Communication25  and  their  application  so  far.  On  23  July  2009,  the 
Commission adopted guidelines on the return to viability and the assessment of restructuring 
measures in the financial sector in the current crisis under the State aid rules26, which explain 
the criteria that the Commission will apply to restructuring aid for banks in the current period. 

the  Banking  Communication, 

3.2. 

The Commission's intervention in crisis cases 

The  Commission  has  been  and  will  continue  playing  a  key  role  in  coordinating  Member 
States' action with a view to maintaining a level playing field, preserving the integrity of the 
common  market  and  fighting  harmful  protectionism.  The  Commission  will  continue  to 
monitor  closely  the  situation  in  the  market  and  review  Member  States'  support  measures  in 
order  to  ensure  that  they  are  designed  in  a  way  to  limit  as  much  as  possible  competition 

22 

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24 
25 

26 

See  Communication  from  the  Commission  –  The  application  of  State  aid  rules  to  measures  taken  in 
relation  to  financial  institutions  in  the  context  of  the  current  global  financial  crisis,  OJ  C  270, 
25.10.2008,  p.  8  ("the  Banking  Communication");  Communication  from  the  Commission  –  The 
recapitalisation of financial institutions in the current financial crisis: limitation of aid to the minimum 
necessary  and  safeguards  against  undue  distortions  of  competition,  OJ  C  10,  15.01.2009,  p.  2  ("the 
Recapitalisation  Communication");  Communication  from  the  Commission  on  the  Treatment  of 
Impaired  assets  in  the  Community  Banking  Sector,  OJ  72,  26.03.2009  ("the  Impaired  Assets 
Communication");  Commission  Communication  "The  return  to  viability  and  the  assessment  of 
restructuring measures in the financial sector in the current crisis under the State aid rules", OJ C 195, 
19.8.2009, p. 9 
See point II of the Presidency’s Conclusions of the Brussels European Council 18/19 June 2009 
Spring 2009 Scoreboard (http://ec.europa.eu/competition/state_aid/studies_reports/studies_reports.html) 
A short presentation of these Communications provides chapter 3 of the Facts and Figures on State aid 
in the EU Member States in Annex. 
Commission Communication on the return to viability and the assessment of restructuring measures in 
the financial sector in the current crisis under the State aid rules OJ C 195/2009 of 19/8/2009. 

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distortions and to maintain the functioning of the single market. In addition, the Commission 
has particularly emphasised that support measures must be designed considering the medium-
to-long  term  perspective,  in  particular  in  the  effort  of  swiftly  returning  to  a  competitive 
environment.  Finally, the Commission will  support restructuring processes in the context of 
State aid monitoring. 

For  example,  the  Irish  announcement  to  cover  only  six  Irish  banks  by  a  state  guarantee 
scheme  presented  a serious  risk  of a large outflow of capital from non-eligible competitors. 
Upon  the  Commission's  insistence  the  Irish  Government  confirmed  within  days  that  the 
guarantee  scheme  would  be  available  to  all  banks  with  subsidiaries  or  branches  in  Ireland 
with a significant presence in the domestic economy27. 

Similarly, when France announced its planned aid to the automotive sector which originally 
raised concerns concerning State aid and single market rules, the Commission stated without 
ambiguity  that  any  aid  granted  under  additional  non  commercial  conditions  concerning  the 
location  of  investments  (and/or  the  geographic  distribution  of  restructuring  measures  in 
another  case)  could  not  be  regarded  as  compatible.  After  intensive  discussion  between  the 
Commission  and  the  French  authorities,  France  gave  undertakings  to  avoid  any  conditions 
contrary  to  the  single  market  rules28.  This  line  has  been  maintained  in  all  other  cases,  in 
particular with regard to the German plans in relation to Opel29. 
In Bradford&Bingley30, the Commission ensured that the beneficiaries of the aid will be the 
retail depositors of the bank. The State intervention allowed continuing the retail business of 
the  bank  through  selling  of  the  retail  branch  whereas  the  distressed  part  of  the  bank  was 
allowed to discontinue. 

The  effectiveness  of  bank  support  schemes  as  well  as  the  overall  situation  regarding  the 
stability  and  functioning  of  financial  markets  has  recently  been  assessed  by  the  Council31, 
concluding that public measures taken since the third quarter of 2008 have contributed to the 
stabilisation  of  the  extremely  tense  financial  market  conditions.  However,  the  operating 
environment for banks is likely to remain challenging, in particular in respect of credit losses 
linked to their loan portfolios. 

3.3.  Measures approved and take-up rate 

In  the  period  between  October  2008  and  end  October  2009,  the  Commission  approved 
73 crisis  measures.  When  broken  down  by  type  of  measures,  it  results  in  32  schemes 
relief 
schemes, 
(guarantee 
interventions) and 41 individual cases. 

interventions,  asset 

recapitalisation 

schemes, 

liquidity 

The total maximum volume of crisis measures approved by the Commission between October 
2008  and  October  2009  amounted  to  around  € 3,632  billion,  corresponding  to  29%  of  the 
EU-27  GDP32.  In  regard  of  guarantee  schemes,  the  maximum  volume  amounted  to 
the  EU-27  GDP.  Recapitalisation  measures 
€ 2,738 billion,  which  corresponds  to  22%  of 

27 
28 
29 
30 
31 

32 

See NN 48/2008 Guarantee scheme for banks in Ireland  
See press release (Memo/09/90). 
See press releases (Memo/09/460 and Memo/09/411) 
NN 41/2008 Rescue aid to Bradford & Bingley 
Annex  to  the  Council  (Ecofin)  Report  to  the  18-19  June  European  Council  on  the  effectiveness  of 
financial support schemes: Report of the Task Force on reviewing the effectiveness of financial support 
measures. 
This  figure  represents  the  overall  maximum  amount  of  guarantee  umbrellas,  rescue  and  restructuring 
packages and other measures set up by Member States. 

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amounted  to  € 231 billion 33  corresponding  to  2%  of  the  EU-27  GDP.  General  liquidity 
measures and asset relief interventions amounted to € 76 billion and represent 0.6% of the EU 
GDP. In addition, the Commission took decisions in several ad hoc interventions in favour of 
individual financial institutions amounting to a total volume of € 587 billion. 

Most of the general schemes were authorised by the Commission in autumn 2008 following 
the  publication  of  the  Banking  and  Recapitalisation  Communications34.  The  measures 
approved  in  2008,  schemes  and  ad  hoc  aid  taken  together,  amounted  to  € 3,361 billion.  In 
2009, Member States saw only limited need to set up new additional support measures. From 
January  to  March  2009,  further  rescue  and  stabilisation  measures  amounting  to  € 96 billion 
were  approved  by  them  Commission.  Since  April  2009,  Member  States  have  only  adopted 
additional measures with an overall maximum volume amounting to € 175 billion 35. 

The take-up rate by banks is defined as the actual use of the measure relative to the notified 
approved amounts. It serves as a preliminary indicator for the functioning of the schemes36. 
The  maximum  total  aid  volume  as  indicated  above  has  not  been  actually  implemented.  The 
take-up rate on the crisis measures, as reported by the Commission37, amounts to roughly 33% 
with respect to guarantees and for recapitalisation it is roughly 55%. 

State aid granted during 2008 

3.4. 
Total State aid related to crisis measures38 granted by the Member States amounted to 
approximately € 212.2 billion in 20 08, representing 1.7% of EU-27 GDP 

The maximum volume of Commission approved measures set up by Member States in 2008 
to stabilise the financial markets amounted to € 3361 billion. According to the annual reports 
submitted by Member States, Member States implemented measures amounting to a nominal 
value of € 958 billion. This corresponds to a take -up rate of 29%. According to first estimates, 
the aid element of the support measures put in place in 2008 – as proxy for the benefits passed 
by  the  State  to  the  benefitting  financial  institutions  –  amounted  to  € 212.2 billion,  which 
represents 1.7% of EU-27 GDP. The Commission approved in 2008 crisis measures notified 
by seventeen Member States. Only thirteen Member States reported that these measures were 
already implemented in 2008. 
In  2008,  ad-hoc  crisis  measures39  represented  37  of  total  crisis  aid  and  aid  granted  under 
schemes representing 63%. 

33 

34 

35 

36 

37 

38 

It  includes  recapitalisation  schemes  and  schemes  combining  recapitalisation  with  other  measures. 
Discrepancies  with  the  amounts  published  in  the  spring  2009  Scoreboard  are  due  to  the  different 
classification  of  the  schemes.  The  present  edition  considers  liquidity  interventions  as  a  separate 
category. 
The  spring  2009  Scoreboard  was  focused  on  State  aid  interventions  in  the  current  financial  and 
economic crisis and an overview on measures reviewed by the Commission until 31 March 2009. 
Inter  alia  six  schemes  based  on  the  Banking  Communication,  one  on  the  Impaired  Assets 
Communication and one specific other scheme. 
A high take-up rate in a given Member State is not necessarily an indication of whether the measure is 
adequate or not. Low guarantee take-up rates in certain Member States are partly due to the fact that the 
amounts announced under the schemes are higher than actual need. Moreover, in some Member States 
banks were able to access the funds easily on the market, often at a lower price. 
For more detail, see DG Competition's review of guarantee and recapitalisation schemes in the financial 
sector in the current crisis, 7 August 2009. 
(http://ec.europa.eu/competition/state_aid/legislation/review_of_schemes_en.pdf) 
It  covers  some  individual  early  cases  during  the  first  phase  of  the  crisis  adopted  under  the  R&R 
guidelines  and  measures  approved  under  the  Banking  and  Recapitalisation  Communications 
implemented  in  2008.  Measures  related  to  the  real  economic  crisis  approved  under  the  Temporary 
Framework are not covered in this Section since they were adopted and implemented in 2009. 

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For an overview on crisis measures authorised, see chapter  3 of Facts and Figures on State aid 
in the EU Member States in Annex. 

4. 

SIMPLIFICATION OF THE STATE AID RULES 

4.1. 

A new architecture for State aid control 

The SAAP announced in June 2005 the Commission's intention to further the use of State aid 
policy as an effective policy tool for growth and jobs. The plan launched a review of almost 
all  the  State  aid  rules  and  procedures40.  Four  guiding  principles  underpinned  the  reform 
programme: 

•  less and better targeted State aid; 

•  a refined economic approach; 

•  more  effective  procedures,  better  enforcement,  higher  predictability  and  enhanced 

transparency; 

•  a shared responsibility between the Commission and Member States. 

The  Commission  has  the  exclusive  competence  to  evaluate  the  compatibility  of  state  aid 
measures with the EC Treaty. Accordingly, Member States are obliged to notify all measures 
prior  to  their  implementation41  to  the  Commission,  unless  they  are  covered  by  the  "de 
minimis"  Regulation42  or  a  block  exemption  Regulation,  in  particular  the  General  Block 
Exemption Regulation (hereinafter "GBER")43. The rationale behind this change is that such 
measures are unlikely to have a significant negative impact on competition at the Community 
level while contributing to the achievement of an objective of common interest and may thus 
be granted without prior notification to the Commission provided they fulfil the criteria of the 
respective  legal  instruments.  For  State  aid  measures  that  remain  subject  to  Commission 
scrutiny prior to their implementation, Member States can notify aid schemes. After a scheme 
has  been  approved,  a  Member  State  may  generally  grant  individual  awards  of  aid  without 
further  notice  to  the  Commission.  Only  large  individual  applications  of  aid  schemes 
exceeding certain thresholds and individual aid (also known as 'ad hoc' aid) awarded outside a 
scheme need to be notified individually. 

The "3-Stream system: block exemption, standard and detailed assessment 

In order to make procedures and decision-making faster and more efficient, the Commission 
introduced substantial changes to the architecture of its State aid control. This was achieved 
by  subjecting  the  various  aid  measures  to  a  level  of  control  which  reflects  their  respective 
potential  effects  on  competition  and  trade.  The  new  architecture  is  based  on  a  "3–stream 
system":  block  exemption  (and  de  minimis),  standard  assessment  and  detailed  assessment. 
While  the  number  of  block  exempted  measures  increases,  the  majority  of  still  notifiable 
individual cases or schemes are subject to a standard assessment ensuring smooth assessment. 

39 
40 
41 

42 

43 

Reported or estimated aid volumes  
See table 2 in Annex of Facts and figures on State aid in the EU Member States 
Article  88  EC  Treaty;  detailed  provisions  in  Council  Regulation  No  659/1999  of  22  March  1999,  OJ 
L83/1, 27.03.1999, p. 1-9 
Commission Regulation (EC) No 1998/2006 of 15 December 2006 on the application of Articles 87 and 
88 of the Treaty to de minimis aid, OJ L 379, 28.12.2006, p. 5 
Commission  Regulation  (EC)  No  800/2008  of  6  August  2008  declaring  certain  categories  of  aid 
compatible with the common market in application of Article 87 and 88 of the Treaty (General block 
exemption Regulation); OJ L 214, 9.8.2008, p. 3 

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A detailed assessment was carried out only in 25 out of 177 of R&D&I cases and in 10 out of 
49  of  risk  capital  cases  between  2007  until  mid  2009.  No  detailed  assessment  was  made  in 
cases falling under any of the other horizontal objectives. 

The new simplified procedure 

In  order  to  make  the  notification  process  for  a  priori  compatible  cases  even  smoother,  the 
Commission  introduced  in  September  2009  a  simplified  procedure44.  With  this  new 
procedure, the Commission aims to ensure that clearly compatible aid is approved within an 
accelerated  time  period  of  one  month,  based  on  a  complete  notification  from  the  Member 
State. 

4.2. 

Assessment of individual cases focused  on a small number of large, potentially 
distortive aid 

Member States increasingly use the possibilities for block exempted aid and continue to use 
schemes  on  the  basis  of  which  aid  to  individual  enterprises  can  be  granted  without  further 
notice  to  the  Commission.  In  2008,  648  or  66%  of  newly  introduced  measures  fell  under 
block  exempted  aid,  while  the  248  schemes  that  were  subject  to  a  Commission  decision  in 
2008,  accounted  for  25%  and  92  individual  aid  measures  accounted  for  9%.  In  terms  of 
reported aid volumes (crisis measures excluded), individual aid accounted for only 5% of total 
aid to industry and services (€ 2.5 billion), while aid granted under schemes amounted to 76% 
(€ 40 billion)  and  block  exempted  aid  to  19%  (€
 10 billion).  This  means  that  95%  of  aid  to 
industry  and  services,  while  being  subject  to  state  aid  discipline,  was  granted  by  Member 
States  without  requiring  an  individual  assessment  by  the  Commission  at  the  level  of  the 
beneficiary. 

4.3. 

Almost 19% of aid to industry and services is block exempted 

In terms of expenditure, block exempted aid saw a significant increase to € 10 billion or 19% 
of total aid to industry and services in 2008 compared to 2007 (€ 6.3 b illion or 13%) and 2006 
(€ 3 billion or 6% of total aid) . The main increase can be attributed to regional aid under the 
block exemption possibility introduced in 2007. Also the other already existing objectives for 
block  exempted  aid,  i.e.  aid  to  SME,  training  and  employment  are  increasingly  used.  The 
potential  of  the  newly  introduced  objectives  under  the  GBER  will  have  to  be  explored  in 
future as the new Regulation only entered into force end August 2008. 

5. 

ENFORCING THE STATE AID RULES 

Unlawful aid 

Article 88(3) of the EC Treaty obliges Member States to not only notify state aid measures to 
the  Commission  before  their  implementation  but  also  to  await  the  outcome  of  the 
Commission's  investigation  before  implementing  notified  measures.  When  either  of  these 
obligations is not respected, the state aid measure is considered to be unlawful. 

In the period 2000-2008, the Commission took 811 decisions on unlawful aid. In about 23% 
of unlawful aid cases (187 cases) the Commission intervened by taking a negative decision on 
an  incompatible  aid  measure.  This  negative  decision  normally  requests  the  Member  State 
concerned to recover the illegally awarded aid. In further 2% of unlawful aid cases (15 cases), 
the Commission took a conditional decision. This intervention rate of about 25% for unlawful 

44 

Commission Notice on a Simplified procedure for the treatment of certain types of State aid; OJ C136, 
16.06.2009, p. 3-12 

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aid is approximately ten times higher than the rate of negative and conditional decisions on 
duly notified cases. More than half of the interventions were made in the sector of industry 
and  services,  around  one  quarter  in  agriculture  and  the  remainder  in  transport,  coal  and 
fisheries. 

Recovery of aid 

In  the  first  half  of  2009,  further  progress  has  been  made  towards  the  execution  of  pending 
recovery decisions. The total number of pending recovery cases has further decreased to 43 
(compared to 50 cases in mid-2007 and 94 cases at the end of 2004). The amount of illegal 
and  incompatible  aid  recovered  since  2000  has  further  increased  from  € 2.3 billion  in 
December 2004 to € 9.4 billion at 30 June 2009. That  means that the percentage of illegal and 
incompatible aid still to be recovered has fallen from 75% at the end of 2004 to around 9% at 
30 June 2009. 

In  addition,  the  Commission  has  taken  some  recovery  decisions  in  the  areas  of  agriculture, 
fisheries and transport. 

Enforcement of State aid Law: Cooperation with national courts 

The Commission has recently adopted a new Notice on the Enforcement of State Aid Law by 
National Courts45. The Notice has two main objectives: 

–  The new Notice seeks to give clear guidance to national courts and to potential claimants 

on the different issues which can arise in the context of domestic State aid litigation. 

–  In  addition,  the  Commission  seeks,  through  the  new  Notice,  to  intensify  its  co-operation 

with national courts in individual cases. 

Following  the  adoption  of  the  New  Notice  the  Commission  plans  to  intensify  its  advocacy 
efforts in the area of private State aid enforcement. 

Ex-post monitoring 

With the entry into force of the GBER an increasing number of aid measures are no longer 
subject  to  the  notification  obligation.  Article  10  of  that  regulation  constitutes  the  basis  for 
realising  ex  post  monitoring  on  a  sample  basis.  The  analysis  of  the  results  of  the  first  three 
exercises  shows  that,  overall,  the  part  of  the  existing  state  aid  architecture  allowing  for  the 
approval  of  aid  schemes  and  allowing  Member  States  to  implement  aid  measures  under 
(G)BERs functions in a satisfactory manner. 

45 

Commission Notice on the enforcement of State aid law by national courts, OJ C 85, 9.4.2009, p. 1 

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Commission  Staff  Working  Document  "Facts  and  figures  on  State  aid  in  the  EU 
Member States" 

ANNEX  

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