While CISAF is the latest of these frameworks, it may not be the last. The Commission can expand its state aid policy objectives virtually indefinitely as long as they serve the Union’s interest, said Adina Claici, an economist at Berkeley research Group and a former official at the competition directorate’s chief economist team.
But the Commission’s latest framework is, as always, a careful balancing act between the desperate need for a Union-wide industrial policy and the rules that form the very basis of its single market.
While the framework aims to simplify and accelerate the approval of support for clean tech and decarbonization projects, “it still maintains key safeguards that apply to all state aid measures — such as the need for an incentive effect and ensuring that support is proportionate and necessary,” said Katarzyna Berestecka, an antitrust lawyer at Norton Rose Fulbright.
Safeguards include capping the amount that EU countries can spend on their industry and adding conditionality clauses. On electricity prices, for example, the conditionality clause requires that companies receiving energy bill relief invest 50 percent of the aid in decarbonization projects.
The next test will be how CISAF works in practice when funding proposals land on the desks of competition officials, especially regarding larger projects. “There is a risk for the Commission of losing court appeals [from rivals that did not receive state aid] after its decision, so the stakes are high,” Claici said.
Nicolas Camut contributed to this report.
