The European Commission has approved Belgium’s map for granting regional aid from 1 January 2022 to 31 December 2027 within the framework of the revised Regional aid Guidelines (RAG). FI Group keeps you informed of the latest changes and updates.
What are the Regional Aid Guidelines?
The ultimate purpose of regional state aid is to support economic development and employment. The regional aid guidelines (RAG) set out the rules under which Member States can grant state aid to companies to support investments in new production facilities in the less advantaged regions of Europe or to extend or modernise existing facilities.
In the RAG, the European Commission sets out the conditions under which regional aid may be compatible with the internal market and establishes the criteria for identifying the areas that fulfill the aid conditions. The most disadvantaged regions are identified as follows:
The guidelines also contain rules for the Member States to draw up regional aid maps (the geographical areas where companies can receive regional state aid, and at which intensities). For Belgium, this map has been approved in July 2022 but still needs to be published.
Belgium’s regional map defines the Belgian regions eligible for regional investment aid. The map also establishes the maximum aid intensities in the eligible regions. The aid intensity is the maximum amount of State aid that can be granted per beneficiary, expressed as a percentage of eligible investment costs.
Why a revision of RAG in 2022?
The revised RAG, in force since 1 January 2022, enable Member States to support the least favoured European regions in catching up and to reduce disparities in terms of economic well-being, income, and unemployment. They also provide increased possibilities for Member States to support regions facing transition or structural challenges.
The revised Regional Aid Guidelines include several targeted adjustments to simplify and reflect experience gained from the application of the previous rules:
The revised RAG maintain strong safeguards to prevent Member States from using public money to trigger the relocation of jobs from one EU Member State to another, which is essential for fair competition in the Single Market.
How does it affect the Belgian regions?
For all affected areas, the maximum aid intensities can be increased by 10 percentage points for investments made by medium-sized enterprises and by 20 percentage points for investments made by small enterprises, for their initial investments with eligible costs up to 50 million euro.
In order to address regional disparities, Belgium has designated non-predefined C-areas:
In these areas, the maximum aid intensities for large enterprises vary between 10% and 15%, depending on their GDP per capita and unemployment rate.
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