Business subsidies – public authorities free to award as they wish

“The introduction of these new rules is the most significant change in subsidy administration in over 40 years and marks a landmark transition away from the restrictive aid scheme the UK was subject to as part of the EU, which would regularly block elected devolved administrations and local authorities from delivering funds to businesses that most needed it in their communities.

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Under the previous EU system, all subsidies except for a select few under a ‘Block Exemption Regulation’ would be required to undergo a time-consuming bureaucratic process, subject to European laws and the European Commission.

Subsidies would require notification to and approval from the European Commission well in advance, therefore delaying vital funds reaching businesses in good and efficient time. The new regime is tailor-made for businesses and public authorities in the UK, with views gathered from stakeholders across the country in an extensive consultation.

The new regime will also give public authorities the ability to award subsidies through streamlined routes, schemes that are pre-assessed by the government, and provide public authorities with an even easier and quicker way to award subsidies to businesses. The government is currently developing 3 of these schemes, which will cover research, development and innovation, energy usage, and local growth.

The new regime also contributes to the UK meeting international commitments on subsidy control, including its international commitments at the World Trade Organisation (WTO) and in Free Trade Agreements.”