REPORT FROM THE COMMISSION State Aid Scoreboard   Report on State aid granted by the EU Member States   - Autumn 2010 Update -
Date: 2010-12-01
Institutions: European Commission
Subjects: EU Member State, European Commission, State aid, control of State aid, economic analysis, economic recession, report

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EUROPEAN COMMISSION 

Brussels, 1.12.2010 
COM(2010) 701 final 

REPORT FROM THE COMMISSION 

State Aid Scoreboard 

Report on State aid granted by the EU Member States 

- Autumn 2010 Update - 

{SEC(2010) 1462 final} 

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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 2009........................................................................................................... 4 

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

Trend of levels of State aid to industry and services ................................................... 5 

State aid earmarked for horizontal objectives of common interest.............................. 6 

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

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

Total volume of State aid measures approved for the financial sector ........................ 8 

Actual use of State aid measures and take up rate ....................................................... 9 

Aid granted under the Temporary Framework........................................................... 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 measures............................................................................................... 13 

4.3. 

Around 19% of aid to industry and services is block exempted ................................ 13 

5. 

Enforcing the State aid rules ...................................................................................... 13 

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INTRODUCTION 

This  autumn  2010  update  of  the  State  Aid  Scoreboard  (hereinafter  "the  Scoreboard") 
describes  the  State  aid  situation  in  the  twenty-seven  Member  States  for  the  year  2009.  It 
provides  an  overview  of  aid  levels  and  the  objectives  pursued  by  aid  granted  by  Member 
States. The report includes a chapter on State aid granted to financial institutions and to the 
real economy in response to the financial and economic crisis. 

Furthermore, the Scoreboard reports on the 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 notes achievements in the field of enforcement of State aid rules. 

The  Scoreboard  consists  of  two  parts:  first  a  summary  Report,  adopted  by  the  College  of 
Commissioners focussing 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. Secondly, a Staff Working Document, attached to the Report, "Facts and figures on 
State aid in the EU Member States", providing the 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 

In the lead-up to the financial crisis, the EU had been experiencing steady economic growth 
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 brought an end to the steady GDP growth, low levels of State aid 
and  decreasing  budget  deficits  seen  since  the  year  2000.  The  overall  level  of  State  aid 
increased further in 2009 as compared to 2008 and stood at 3.6% of GDP, again as a result of 
crisis  aid  to  the  financial  sector  in  particular.  Aid  to  the  real  economy  granted  through  the 
Temporary  Framework3,  which  Member  States  started  to  implement  in  2009,  was  only  a 
minor contributor to the overall increased aid volume.  

When inter-bank lending dried up in September 2008, Member States started to inject large 
amounts  of  aid  to  the  banking  sector  to  ensure that lending to  the economy  could  continue. 
Guided by the Temporary Framework, Member States also started to ease business's financing 
constraints. The European Commission's State aid policy was one of the key factors ensuring 
that this – generally 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 Internal Market was kept intact. 

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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, 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 C 83, 7.4.2009; as further amended by OJ C 261, 31.10.2009, 
p. 2, and OJ C 303, 15.12.2009, p. 6. 

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STATE AID IN 2009 

1. 
Total  State  aid4  granted  by  the  Member  States  in  2009  amounted  to  € 427.2 billion  or,  in 
relative  terms,  3.6%  of  EU-275  GDP.  Of  this  total,  € 353.9  billion  or  3%  of  EU-27  GDP 
related  to  crisis  measures  reported  by  Member  States.  In  2009,  twenty-two  Member  States 
implemented  crisis  aid  in  favour  of  the  financial  sector  (2.98%  of  EU-27  GDP).  On 
1 October 20106, all EU-157 Member States and Cyprus, Hungary, Latvia, Lithuania, Poland, 
Slovakia and Slovenia had had financial crisis measures approved by the Commission and all 
Member States had granted aid under the Temporary Framework, except Cyprus.  

If the crisis measures are excluded, total State aid amounted to around € 73.2 billion in 2009 
or 0.62% of EU-27 GDP. Aid to industry and services represents 79.3% of total State aid, that 
is  € 58.1 billion  or  0.49%  of  EU-27  GDP 8.  Aid  to  agriculture  amounted  to  € 11.6 billion  or 
15.9% of total aid), fisheries (€ 0.2 billi on or 0.3% of total aid) and transport9 (€ 3.3 billion or 
4.5% of total aid). 
Aid to railways10 is reported by Member States to amount to € 33.1 billion or 0.3% of EU-27 
GDP11. 
In absolute terms, the five largest grantors account for € 39.8 billion or 68.2% of total aid 12. 
Germany  accounted  for 
26.3%  of  total  aid,  followed  by  France 
(€ 11.7 billion; 20.1%), Spain (€ 4.9 billion; 8.4 %), Italy (€ 4.6 billion; 7.9%), and the United 
Kingdom (€ 3.3 billion; 5.5%). A completely diffe rent picture emerges when looking at aid as 
a  percentage  of  GDP:  Malta  granted  aid  representing  1.7%  of  GDP,  followed  by  Hungary 
(1.0%), Portugal and Denmark (each 0.9%) and Sweden (0.8%). 

€ 15.3 billion  or 

2. 

TRENDS AND PATTERNS OF STATE AID EXPENDITURE IN THE MEMBER STATES 

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 then 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 response to the financial 
and  economic  crisis,  the  overall  EU-27  aid  level  increased  significantly  and  stood,  as  noted 
above, at 3.6% of GDP in 2009. 
Figure 113: Total State aid as % of GDP (EU-27; data as of 1992) 

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The  total  covers  aid  to  manufacturing,  services,  coal,  agriculture,  fisheries  and  part  of  the  transport 
sector  but  excludes,  due  to  the  lack  of  comparable  data,  aid  to  the  railway  sector  and  aid  for 
compensation for services of general economic interest. Aid amounts refer to the aid element (or gross 
grant equivalent in case of guarantees or loans) contained in a State aid measure unless stated otherwise 
(see methodological remarks in the Commission Staff Working Document, attached to this Report). 
EU-27 means all Member States of the EU. 
In order to give a complete picture on crisis aid, the whole of the period dating from the adoption of the 
Commission's crisis measures to a cut-off date of 1 October 2010 is used as the reference period for this 
part of the report.  
EU-15 comprises Member States that joined the EU before 2004. 
Coal, as part of sectoral aid, amounted to € 2.7 billi on or 3.7% of total aid.  
Excluding railways. 
Since comparable data are lacking, it is not included in any of the totals.  
See paragraph 2.3.5 of Commission's Staff Working Document "Facts  and figures on State aid in the 
EU Member States". 
Crisis measures excluded. 
Source: DG Competition; GDP figures: Eurostat. 

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Total State aid as % GDP - EU-27, as of 1992

P
D
G

f
o
%

4

3.5

3

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

2009

EU-27

EU-27 (excluding crisis measures)

The  decline  in  State  aid  expenditure  from  2000  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 
contributed to the downward trend since the EU-1214 Member States continued to adjust their 
State aid policies and practices to the requirements of EU State aid law and policies. 

These efforts can be seen as the result of a general recognition that a too high volume of State 
aid  not  only  hinders  an  efficient  allocation  of  resources  but  also  renders  the  economy  as  a 
whole less competitive. Work in this regard already began in the mid 1980s to make effective 
State aid control a key component of the Single Market Programme. State aid discipline was 
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 
has focused largely on a better targeting of aid15 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  stood  at  0.62%  of  GDP 
that year as compared with the previous 
(€ 73.2 billion) in 2009. Though increasing again in 
year,  it  is  still  within  the  average  of  the  past  ten  years.  This  seems  to  indicate  that  first 
Member  States  continued  to  maintain  State  aid  discipline16;  and  second,  the  strict  State  aid 
discipline in the years prior to the crisis can be seen as an important contribution that made a 
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 while being proportionate to that objective. 

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 only at aid to industry 
and services. 

2.1. 

Trend of levels of State aid to industry and services 

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

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EU-12 includes Member States which acceded to the EU in 2004 or later. 
I.e. to promote horizontal aid versus sectoral aid. 
When crisis aid is excluded. 

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For the EU as a whole, the trend in the level of aid granted to industry and services in the EU 
has been rather stable during the two consecutive three-year periods 2004 - 2006 and 2007 - 
2009  when  compared  as  a  percentage  of  GDP.  On  average,  aid  expenditure  amounted  to 
€ 55.1 billion  or  0.45%  of  GDP  in  2007  -  200 9,  whereas  during  2004  -  2006  the  average 
amounted to € 53 billion or 0.45% of GDP. This  shows that, leaving the specific response to 
the financial and economic crisis aside, many Member States have continued in their effort to 
keep overall aid levels under control. 

Eleven  Member  States  were  able  to  maintain  or  even  further  reduce  their  aid  levels  in  the 
period 2007 - 2009 as compared with 2004 - 2006. Many of the EU-12 countries achieved a 
significant  reduction  of  0.5%  of  GDP  or  even  more.  As  a  result,  the  average  EU-12 
expenditure decreased by 0.12%, i.e. from 0.69% of GDP in 2004 - 2006 to 0.57% in 2007 - 
2009. Some EU-15 countries were also able to reduce aid levels, now at approximately 0.44% 
of GDP in the period 2007 - 2009, which were also 0.44% of GDP in the period 2004 - 2006. 

Despite the positive downward trend in these Member States, other Member States increased 
aid  expenditure  in  2007  -  2009  compared  to  2004  -  200617.  Any  increase  can  largely  be 
attributed  to  aid  in  favour  of  horizontal  objectives,  mainly  for  regional  development  and 
research and development. That said, the increase in aid volumes witnessed in 2008 and 2009 
do  not  yet  allow  a  conclusion  to  be  drawn  as  to  whether  the  long-term  downward  trend  in 
EU-27  State  aid  expenditure  has  been  reversed;  the  data  is  for  just  two  years  and  remains 
within the average for the period 2000 - 2007. 

The  short-term  evolution  from  2008  to  2009  shows  a  small  upward  move.  State  aid 
expenditure  for  industry  and  services  rose  by  approximately  0.03%  of  GDP.  For  instance, 
France  granted  more  aid  to  regional  development  as  well  as  for  research  and  development, 
Germany more on regional aid and aid to SMEs. This short-term upward evolution shows that 
the current State aid control system still allows Member States to react quickly to changing 
economic  needs  without  further  individual  notifications  to  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). 

2.2. 

State aid earmarked for horizontal objectives of common interest 

It  is  recalled  that  State  aid  for  horizontal  objectives,  which  is  aid  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 including energy saving and renewable 
energies, support to Small and Medium-Sized Enterprises (hereinafter "SME"), employment 
creation,  the  promotion  of  training  and  aid  for  regional  economic  development  to  support 
territorial cohesion are the most prominent horizontal objectives pursued using 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 analysis18. 

On this basis, aid earmarked for horizontal objectives amounted in 2009 to € 48.7 billion and 
accounted for roughly 84% of the total aid to industry and services. This is to be compared 
with  much  lower  levels  in  2004  (74%)  and  in  the  mid-Nineties  (50%).  The  three  main 

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Belgium,  Czech  Republic,  Denmark,  Ireland,  Greece,  France,  Lithuania,  Hungary,  Portugal  and 
Slovakia.  
If one were to include crisis measures, the share of horizontal aid would drop to 13%. 

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objectives pursued by Member States in 2009 were regional aid (24%), aid assessed under the 
environmental  aid  guidelines  (23%)19  and  aid  for  R&D&I  (18%).  The  underlying  trend 
confirms  the  upward  move  on  aid  oriented  towards  horizontal  objectives.  However,  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,  a  decrease  was  identified.  In  2009, 
15 Member  States  were  granting  90%  or  more  of  aid  earmarked  for  horizontal  objectives 
compared  to  17  in  200820  and  200721.  No  single  overriding  reason  or  pattern  has  been 
identified to explain this development. 
For the EU as a whole, aid for sectoral development including rescue and restructuring aid22 
in 2009 was higher compared to 2008 and stood at € 9.4 billion or 16% of total aid to industry 
and  services23.  Outside  the  context  of  the  economic  and  financial  crisis,  rescue  and 
restructuring aid, as guided by the Rescue and Restructuring guidelines24, amounted in 2009 
to  just  € 398 million,  compared  to  an  annua l  average  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,  although  some  EU-15  Member  States  have 
granted  more  sectoral  aid  in  2009  compared  to  2008,  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 

State  aid  has  been  one  of  the  main  instruments  in  helping  Member  States  battle  the  worst 
financial crisis in recent history. Since the existing Rescue and restructuring guidelines were 
not  apt  to  address  rapidly  the  deteriorating  situation,  soon  after  the  onset  of  the  crisis  the 
legal  basis  of 
forward  with  several  communications  on 
Commission  came 
Article 107(3)(b)  TFEU25.  Aimed  at  preserving  a  level  playing  field,  ensuring  the  financial 
stability  and  legal  certainty,  these  communications  set  the  Commission's  position  as  to  how 

the 

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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, 21.5.2008. 
See Autumn 2009 Scoreboard - COM(2009) 661, 7.12.2009, p. 5. 
See Autumn 2008 Scoreboard - COM(2008) 751, 17.11.2008, p. 30. 
Rescue and restructuring aid decreased and hence does not contribute to the overall increase in sectoral 
aid.  
These percentages exclude those measures with a horizontal objective that are nevertheless earmarked 
for the manufacturing and services sectors.  
Community  guidelines  on  State  aid  for  rescuing  and  restructuring  firms  in  difficulty  (OJ  C  244, 
1.10.2004, pp. 2-17), as extended by OJ C 156, 9.7.2009, p. 3. 
Since  October  2008  the  Commission  adopted  four  Communications:  1)  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, pp. 8-14); 2) 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,  15.1.2009,  pp.  2-10);  3)  Communication  from  the  Commission  on  the  treatment  of  impaired 
assets in the Community banking sector (OJ C 72, 26.3.2009, pp. 1-22); and 4) Communication from 
the  Commission  on  the  return  to  viability  and  the  assessment  of  the  restructuring  measures  in  the 
financial sector in the current crisis under the State aid rules (OJ C 195, 19.8.2009, pp. 9-20). The latter 
is applicable until the end of 2010.  

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State  aid  rules  would  be  applied  to  governments'  action  in  the  field  of  State  aid26.  Those 
communications  relating  to  the  financial  sector  were  complemented  with  guidance  on  the 
assessment  of  crisis-related  support  measures to the real economy (the so-called Temporary 
Framework, see below). 

Member States' exceptional response, coordinated by the Commission, helped to contain the 
financial  crisis  in  2009.  In  part  due  to  State  aid  measures,  conditions  in  the  financial  sector 
have  stabilised  with  larger  banks  seeing  their  Tier-1  capital  exceeding  10%.  Moreover,  in 
2009  the  financial  sector  experienced  a  strong performance  on  the  earnings  and  profits  side 
and  gradual  recovery  of  financial  assets'  prices.  Even  if  those  improvements  have  not  been 
felt equally across Europe27, it provides a reassuring signal to the markets, Member States and 
the Commission. 
On 2 December 200928, the  Ecofin Council  emphasised the need to disengage  from various 
forms of temporary support for the financial sector. Those conclusions in particular stressed 
that the unwinding of State aid measures should start with guarantee schemes. In that regard, 
the Commission presented an analysis that justifies the introduction of specific pre-requisites 
for guarantee measures after 30 June 201029. At the heart of those changes is a rule making 
guarantee fees dependent on a bank's creditworthiness. This constitutes the first step towards 
exit  from  guarantee  schemes  within  a  coherent  framework  and  as  part  of  a  coordinated 
approach across Member States thereby safeguarding progress made in reinforcing financial 
stability.  The  Ecofin  Council  of  18  May  2010  welcomed  the  Commission's  analysis30  and 
work started aiming at encouraging sound financial institutions to exit from State guarantees 
while  pressing  others  to  assess  their  long-term  viability.  In  the  light  of  that  discussion,  the 
Commission  has  subsequently  approved  or  renewed  schemes  in  14  Member  States,  with 
Cyprus, Finland and Slovakia choosing to phase-out their guarantee measures. 

3.2. 

Total volume of State aid measures approved for the financial sector 

Overall,  the  Commission  took  approximately  200  decisions  on  State  aid  measures  to  the 
financial  sector  based  on  Article  107(3)(b)  TFEU  between  1  October  2008  and 
1 October 201031. Aiming to remedy a serious disturbance in Member States economies, these 
decisions  authorised,  amended  or  prolonged  41  schemes  and  addressed  with  individual 
decisions  the  situation  of  more  than  40  financial  institutions.  The  financial  crisis  called  for 
wide-ranging action with the Commission authorising financial crisis measures in the field of 
State  aid  in  22 Member  States;  very  few  Member  States  (namely  -  Bulgaria,  the  Czech 

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31 

For a more detailed analysis of the main notions of these communications and also for a deeper analysis 
of  the  context  of  the  crisis  please  refer  to  previous  editions  of  the  Scoreboard,  namely  Autumn 
Scoreboard  2008,  Spring  special  edition  2009,  Autumn  Scoreboard  2009  and  Spring  special  edition 
2010. Also see the Report on Competition Policy for 2009 - COM(2010) 282, 3.6.2010, pp. 4-11. 
Some  banks  may  still  give  rise  to  liquidity  concerns  in  view  of  ongoing  restructuring  and  market 
uncertainties.  
See  2981st  Council  meeting,  Economic  and  Financial  Affairs,  Brussels,  2  December  2009,  16838/09 
(Press 352): http://www.consilium.europa.eu/uedocs/cms_Data/docs/pressdata/en/ecofin/111706.pdf. 
Staff working paper on the application of state aid rules to government guarantee schemes covering 
bank debt to be issued after 30 June 2010, 
http://ec.europa.eu/competition/state_aid/studies_reports/phase_out_bank_guarantees.pdf.  
See 3015th Council meeting, Economic and Financial Affairs, Brussels, 18 May 2010, 
http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ecofin/114495.pdf. 
In  order  to  reflect  the  latest  developments,  the  reference  period  for  approved  amounts  and  decisions 
taken  in  the  context  of  financial  crisis  cases  taken  in  this  Scoreboard  is  from  1 October  2008  until 
1 October 2010. Any differences with other Commission documents analysing the approved volumes of 
aid as guarantees can be explained by a different reference date. 

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Republic,  Estonia,  Malta  and  Romania)  who  did  not  grant  any  aid  to  their  financial 
institutions. 

The  maximum  volume  of  Commission-approved  measures  since  the  beginning  of  the  crisis 
until  1  October  2010  (including  both  schemes  and  ad  hoc  interventions)  amounts  to 
€ 4 588.90  billion.  The  total  volume  approve d  for  schemes  (€ 3 478.96 billion)  was 
considerably  higher  than  for  individual  financial  institutions  (€ 1 109.94 billion).  Large 
amounts of support approved under schemes can be explained by the fact that some Member 
States32  adopted  large  blanket-guarantee  schemes  which  covered  the  entirety  of  their  bank's 
debt. 

Of the aid instruments dealt with in that reference period, the greatest bulk was approved as 
guarantees including schemes and ad hoc interventions representing € 3 485.25 billion or 76% 
of  the  maximum  volume.  The  approved  amount  for  recapitalization  measures  constitutes 
€ 546.08 billion, followed by impaired assets interventions with a total approved volume of 
€ 401.79 billion. The maximum volume of aid approve d in relation to liquidity instruments is 
€ 155.77 billion. This data suggests that Member  States relied mainly on guarantee measures 
which had a stabilising effect for the financial sector without weighing heavily on the public 
finances as opposed to more interventionist instruments such as recapitalisations or cleaning 
of  impaired  assets.  In  addition,  nearly  70%  of  the  maximum  volume  relates  to  just  five 
Member States (the United Kingdom, Ireland, Denmark, Germany and France33), with overall 
substantive differences of approved volumes in individual Member States34. 

3.3. 

Actual use of State aid measures and take up rate 

Total State aid granted to the financial sector in the context of the financial crisis in 2009 
represents € 351.7 billion, or 2.98% of EU-27 GDP 

Not all of the aid approved between the start of the crisis and the end of 2009 was actually and 
effectively  used  by  the  Member  States  concerned35.  In  2009,  the  nominal  amount  of  aid 
reported  to  the  Commission  by  Member  States  constituted  € 1 106.56  billion  or  9.3%  of 
EU-27  GDP  (€  727.38  billion  for  schemes  and  €  379.18  billion  for 
ad  hoc  interventions), 
whereas  the  figure  for  2008  was  € 1 236  billion 36.  The  take-up  rate  in  2008  and  2009 
constitutes 65% for guarantees and 62% for recapitalisation measures. Liquidity interventions 
follow a similar pattern with 67%, whereas the take-up rate for impaired assets is 32%37. 

32 
33 
34 

35 

36 

37 

Blanket guarantee schemes were adopted in Denmark and Ireland. 
With some of these Member States having the highest GDP levels in the EU-27. 
For  example,  the  maximum  volume  approved  by  the  Commission  in  the  United  Kingdom  is  €  850 
billion whereas the figure for Lithuania is € 1.74 billion. 
For  more  information  on  the  distinction  between  approved  volumes,  actually  used  amounts  and  aid 
element, read Chapter 3 and the methodological notes in the Staff working document in annex. 
Please note that figures for 2008 actual use and aid element are different from the ones announced in the 
Autumn Scoreboard 2010 because of the data adjustments carried out by Member States (or proposed 
by  the  Commission),  as  for  example  in  the  case  of  Denmark  where  the  figures  for  the  scheme 
NN51/2008 were included into the year 2008. 
The take-up rate constitutes actual use of State aid measures since the beginning of the financial crisis 
in 2008 until 31 December 2009 relative to the total approved amount in this period. At this stage, the 
take-up rate cannot be calculated for 2010 as the Commission is not in a possession of the figures on 
actual  use  for  2010.  These  figures  will  be  reported  by  the  Member  States  in  the  2011  Scoreboard 
exercise. 

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According to the annual reports on State aid expenditure for 200938, Member States reported 
the aid element (or gross grant equivalent39) of the above amount to constitute € 351.7 billion 
which  represents  2.98%  of  EU-27  GDP40.  Approximately  half  of  the  total  State  aid 
expenditure in the context of the financial crisis was provided in the form of recapitalisation 
measures  (€ 139.43  billion),  followed  by  guaran tees  (€ 128.15 billion),  impaired  assets 
(€ 75.27 billion) and liquidity (€

 8.8 billion) interventions. 

The  aggregate  figures  reveal  that  Member  States  granted  more  State  aid  through  ad  hoc 
interventions (€ 240.4 billion) than  through schemes (€ 174.41 billion). 

For a detailed overview of crisis measures authorised by the Commission in 2008 - 2010 and 
aid  granted  under  the  State  aid  rules,  see  Chapter  3  of  the  Commission  Staff  Working 
Document in annex. 

3.4. 

Aid granted under the Temporary Framework 

Context and scope 

As a response to the tightening on access to credit which companies faced as a result of the 
financial crisis, the Commission adopted on 17 December 2008 the Temporary Framework41. 
It  put  focus  on,  first,  maintaining  continuity  in  companies'  access  to  finance  and,  second, 
providing  the  ground  for  sustainable  long-term  growth  by  encouraging  investments. 
Furthermore, rules of existing guidelines were simplified, e.g. higher ceilings for risk capital 
investments were introduced. The Temporary Framework is open to support all sectors of the 
economy but excludes aid that would remedy pre-existing structural problems and hence does 
not apply to companies in difficulty before the crisis. 

The  Temporary  Framework  is  to  be  seen  as  a  part  of  a  wider  Commission  response  to  the 
economic crisis, the European Economic Recovery Plan42.  

38 

39 
40 

41 

42 

In  the  absence  of  data  of  actual  expenditure  and/or  estimations  provided  by  Member  States,  in  some 
instances  Member  States  were  asked  to  confirm  estimations  made  by  the  Commission's  services.  For 
exact estimation methods applied, please refer to the Methodological notes. 
The monetary advantage when aid was granted in form of a guarantee or loan, for instance. 
Data on aid element is drawn from Member States' annual reports on State aid. For more information on 
distinction between actual use and aid element, exact definitions of aid element for each aid instrument 
(guarantees, recapitalizations and impaired assets) in regard of the financial crisis cases, please refer to 
the Methodological notes of the Scoreboard. 
Consolidated version of the Communication from the Commission – Temporary Framework, OJ C 83, 
7.4.2009, p. 1; as amended by OJ C 261, 31.10.2009, p. 1, and OJ C 303, 15.12.2009, p. 6. 
Adopted in November 2008. 

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Measures approved under the Temporary Framework 
Between  17  December  2008  and  1  October  2010,  the  Commission  approved  73  schemes43 
under the Temporary Framework and 4 ad hoc aid measures, amounting to a total approved 
volume of aid to € 82.5 billion (0.7% of EU-27  GDP). The majority represents schemes for 
aid up to € 500 000 per company (23 schemes in  23 Member States), 18 subsidised guarantee 
measures  (14  Member  States),  8  schemes  for  subsidised  loan  interests  (7  Member  States), 
5 schemes offering reduced interest loans to businesses investing in the production of green 
products  (5  Member  States),  and  6  risk  capital  schemes  (5  Member  States).  Moreover,  12 
Member States facilitated export activities through 13 export credit schemes44.  

Aid granted in 2009 

In 2009, the Commission approved measures under the Temporary Framework amounting to 
in total approximately € 81.3 billion. Followi ng from the annual reports submitted by Member 
States  and  their  reply  to  the  Commission's  questionnaire  on  the  Temporary  Framework  the 
aggregated  aid  element  of  all  aid  measures  implemented  by  Member  States  in  2009  is 
estimated to € 2.2 billion, which represents 0.01 8% of EU-27 GDP. Member States seemed to 
be very cautious in the determination of the budget given the uncertainties as to the depth and 
duration  of  the  crisis  and  the  need  to  send  the  markets  a  clear  signal  of  public  authorities' 
availability to meet potential demand for support that then turned out to be substantially lower 
than expected. Moreover, Member States appeared to have applied strictly the conditions of 
granting the aid, largely in view of budgetary constraints, which in turn have likely kept the 
number of beneficiaries small. 

With  respect  to  the  preference  of  choice  offered  under  the  Temporary  Framework,  most 
Member  States  were  attracted  by  the  tool  of  the  limited  aid  amount,  followed  by  the 
subsidised guarantee and subsidised interest loans. 

For more detail, read chapter 3.4 of the Commission Staff Working Document in annex.  

4. 

SIMPLIFICATION OF THE STATE AID RULES 

4.1. 

A new architecture for State aid control 

The Commission has the exclusive power to evaluate the compatibility of State aid measures 
with  the  TFEU.  Accordingly,  Member  States  are  obliged  to  notify  all  measures  to  the 
Commission prior to their implementation45.  

The SAAP announced in June 2005 the Commission's intention to further the use of State aid 
policy as an effective tool for growth and jobs. The plan launched a review of almost all the 
State aid rules and procedures46. 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. 

43 
44 
45 

46 

Figure includes only measures that fall under aid to industry and services. 
12 Schemes were granting aid of up to € 15000 for agricultural producers. 
Article 108 of the Treaty on the Functioning of the European Union; detailed provisions are contained 
in Council Regulation (EC) No 659/1999 of 22 March 1999 (OJ L 83, 27.3.1999, p. 1-9). 
See table 2 in Annex of Facts and figures on State aid in the EU Member States. 

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In  some  instances,  whole  categories  of  aid  have  been  identified  as  unlikely  to  have  a 
significant  negative  impact  on  competition  at  the  Union  level  while  contributing  to  the 
achievement of an objective of common interest. So-called 'block exemptions' have therefore 
been  adopted  and  measures  which  fulfil  the  criteria  laid  down  in  these  specific  instruments 
may  thus  be  granted  without  prior  notification  to  the  Commission47.  When  a  Member  State 
has notified and had approved an aid scheme, it may generally grant individual awards of aid 
without further notice to the Commission. Only large individual applications of aid schemes 
exceeding  certain  thresholds  and  aid  awarded  outside  a  scheme48  need  to  be  notified 
individually. 

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

In  order  to  ensure  an  efficient  and  fast  procedure  and  decision-making,  in  2008  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 has significantly increased over 
past years, the majority of still notifiable individual cases or schemes are subject to a standard 
assessment ensuring smooth assessment. In 2009 a detailed assessment was carried out in 4 
out  of  16  risk  capital  cases;  for  R&D&I  cases,  it  was  9  out  of  30  cases.  No  detailed 
assessment was made for environmental protection cases, and for only 1 out of 59 regional aid 
cases.  No  detailed  assessment  was  made  in  cases  falling  under  any  of  the  other  horizontal 
objectives. 

The new simplified procedure and Code of Best Practice 

To  make  even  smoother  the  notification  process  for  a  priori  compatible  cases,  the 
Commission introduced in September 2009 a  simplified  procedure49. 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. 

The other part of the simplification package was the Code of Best Practice for the conduct of 
State  aid  control  procedures50.  It  is  based  on  a  joint  commitment  of  the  Commission  and 
Member  States  to  achieve  more  streamlined,  and  predictable  procedures  at  each  step  of  the 
State aid investigation. As a result, the Commission should be able to adopt more quickly its 
decisions on State aid cases within the procedural legal framework. 

47 

48 
49 

50 

In  the  following,  block  exempted  aid  includes  aid  granted  under  the  expired  block  exemption 
regulations (BERs) which have been replaced by a consolidated text, 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,  or  GBER), 
(OJ L 214,  9.8.2008,  p. 3).  In  addition,  measures  complying  with  Commission  Decision  of  28 
November 2005 on the application of Article 86(2) of the EC Treaty to State aid in the form of public 
service compensation granted to certain undertakings entrusted with the operation of services of general 
economic  interest  (OJ L 312,  29.11.2005,  p. 67),  and  with  Regulation  (EC)  No  1370/2007  of  the 
European Parliament and of the Council of 23 October 2007 on public passenger transport services by 
rail  and  by  road  and  repealing  Council  Regulations  (EEC)  No  1191/69  and  (EEC)  No  1107/70 
(OJ L 315, 3.12.2007, p. 1), are also exempt from the notification obligation. 
Also known as 'ad hoc' aid.  
Commission Notice on a Simplified procedure for the treatment of certain types of State aid (OJ C 136, 
16.6.2009, p. 3-12). 
Commission Communication on a Code of Best Practice for the conduct of State aid control procedure 
(OJ C 136, 16.6.2009, p. 13).  

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4.2. 

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

Member States increasingly avail themselves of the possibilities for granting block exempted 
aid and in particular use schemes on the basis of which aid to individual enterprises can be 
granted without further notice to the Commission. In 2009, 964 or 76% of newly introduced 
measures51  qualified  as  block  exempted  aid.  225  schemes  (18%)  and  86  individual  aid 
measures (6%) were subject to a Commission decision in 2009. This means that 94% of aid 
measures  aimed  at  industry  and  services,  while  being  subject  to  State  aid  discipline,  were 
granted by Member States without requiring an individual assessment by the Commission at 
the level of the beneficiary. In terms of reported aid volumes52, individual aid accounted for 
only 12% of total aid to industry and services (€ 6.9 billion),  while aid granted under schemes 
amounted to 69% (€ 40.4 billion) and block  exempted aid to 19% (€ 10.8 billion).  

4.3. 

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

Block exempted aid increased by roughly € 2 billi on to € 10.8 billion or 19% of total aid to 
industry and services in 2009 compared to 2008 (€ 8.9 billion or 19%) and 2007 (€ 6.1 billion 
or 13%). The biggest contributor was aid earmarked for regional development53, followed by 
aid  to  SMEs,  training  and  employment.  Some  Member  States  phased-out  aid  measures 
previously  granted  under  the  BERs  and  replaced  it  by  corresponding  GBER  measures 
whereby  Member  States  often  enlarged  the  scope  of  the  measure  now  permitted  under  the 
GBER rules. 

5. 

ENFORCING THE STATE AID RULES 

Unlawful aid 

Article  108(3)  TFEU  obliges  Member  States  not  only  to  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 2000-2009, the Commission took 910 decisions on unlawful aid. In about 22% 
of  unlawful  aid  cases54  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  a  further  2%  of  unlawful  aid  cases55,  the 
Commission took a conditional decision. This intervention rate of about 24% for unlawful aid 
is roughly ten times higher than the rate of negative and conditional decisions in duly notified 
cases. More than half of the interventions were made in the sector of industry and services, 
slightly less than one quarter in agriculture and the remainder in fisheries, transport and coal. 

51 
52 
53 
54 
55 

Crisis measures excluded.  
Crisis measures excluded. 
Since that policy objective was introduced for block exemption in 2007.  
197 cases. 
19 cases. 

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Recovery of aid 

Further  progress  has  been  made  towards  the  execution  of  pending  recovery  decisions.  The 
total  number  of  pending  recovery  stood  at  54  cases56  (compared  to  94  cases  at  the  end  of 
2004). The amount of illegal and incompatible aid recovered since 2000 has further increased 
and amounted to € 12 billion on 30 June 2010 57. 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 11% 
on 30 June 2010. 

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 
In  the  follow-up  to  the  Notice  on  the  Enforcement  of  State  Aid  Law  by  National  Courts58, 
advocacy efforts have intensified by providing for instance an information package published 
on DG  Competition's website59 and through the publication of a booklet60 gathering  the EU 
materials most relevant for State aid enforcement in the judges' daily work. 

Ex-post monitoring 

With the entry into force of the GBER an even higher 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 result showed 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  the  GBER  and  BERs  functions  in  a  satisfactory 
manner.

56 
57 
58 
59 
60 

Period includes the first half of 2010. 
The Commission reports about recovery on a cumulative, mid-year basis. 
Commission Notice on the enforcement of State aid law by national courts (OJ C 85, 9.4.2009, p. 1). 
http://ec.europa.eu/competition/court/state_aid.html.  
http://ec.europa.eu/competition/publications/state_aid/national_courts_booklet_en.pdf . 

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

ANNEX  

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