On 25 June, the European Commission announced that it had adopted a new agricultural block exemption regulation (the ABER) and state aid guidelines in relation to agriculture, forestry and rural development (the 'Guidelines'). The new measures, which form part of the Commission's ongoing state aid modernisation initiative, will enter into force across the EU on 1 July 2014.
The changes introduced by the new ABER include a widening of the categories of exempt aid. Exemptions mean that, subject to meeting certain preconditions, undertakings do not have to obtain prior Commission clearance for proposed aid schemes. The new aid exemptions provided for by the ABER include assistance for:
- certain SMEs engaged in the production, processing and marketing of agricultural produce
- measures compensating agricultural undertakings for damage caused by natural disasters
- start-up producer groups (but not co-operatives), young farmers and small farms
- measures taken to combat diseases and pests
- forestry co-financed by the European Agricultural Fund for Rural Development
- conservation measures taken in relation to cultural and natural heritage on agricultural land
- research and development projects in the agricultural sector.
Exempt aid is subject to various monetary ceilings, expressed both in absolute terms and as a percentage of the total eligible costs of a project. The scope of the guidelines will also be widened, including to cover measures compensating agricultural undertakings for damage caused by protected animals.
Administrative reforms should contribute to a reduction of delays in engaging with the Commission. For example, a new 'one window approach' will mean that Member States in future need only to deal with one Commission office when seeking clearance for their proposed Rural Development Programmes.
In related news, the text of the new general block exemption regulation was published on 26 June 2014 and will also enter into force on 1 July 2014.
The author Brendan Ryan is a member of our cross-disciplinary Public Procurement and State Aid team led by John Houlden.