In recent years, state aid rules have been gradually loosened in the context of the Covid-19 pandemic, and later in the context of Russia’s aggression against Ukraine. In response to the US Inflation Reduction Act of 2022, which includes significant measures to support green investment, the European Commission further eased state aid rules to increase the competitiveness of the EU’s zero-emissions industry and support a rapid transition to climate neutrality by expanding Member States’ ability to support the acceleration of green investment and financing of clean technology production in Europe.
In March 2023, the European Commission adopted a new Temporary Crisis and Transitional Framework to support the economy in the context of Russia’s aggression against Ukraine (New Framework) so that the EU’s goals can be easier to achieve during this period of crisis and green transition, in line with the Green Deal industrial plan. The new framework partially modifies and expands the previous interim framework adopted in the context of the war in Ukraine, in particular by introducing support in key sectors for the transition to a net zero economy. Although the New Framework is a significant relaxation of otherwise strict state aid rules, it is up to the Member States to provide public funding for any support measures they wish to implement at national level.
The new temporary framework, which will run until 31 December 2025, is mainly aimed at reducing the EU’s dependence on fossil fuel imports by accelerating the introduction of renewable energy sources, decarbonising industrial production processes and increasing production capacity in strategic sectors for the transition economy. with zero net emissions. Thus, Member States have the right to implement national aid schemes open to several beneficiaries, subject to their prior notification and approval by the European Commission. As an exception, individual aid may be granted to companies investing in clean technology production if there are specific risks of moving outside the European Economic Area (EEA).
The most important types of assistance provided by the New Framework Program are as follows.
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The article was signed by Sonia Voinescu, senior cooperation lawyer, Gabriela Ifrim, cooperation lawyer
Article supported by PwC Romania
Source: Hot News
Lori Barajas is an accomplished journalist, known for her insightful and thought-provoking writing on economy. She currently works as a writer at 247 news reel. With a passion for understanding the economy, Lori’s writing delves deep into the financial issues that matter most, providing readers with a unique perspective on current events.