Whether you are designing creative new structures for delivering public services or innovative ways to stimulate the economy in your area, it is crucial to factor State aid into your decision making.

The State aid rules have recently been updated and have, in some respects, become more generous. Despite this, the exponential increase in mutualisation, shared services structures and outsourcing makes State aid compliance an increasingly frequent concern for local government, as does the fact that local government is increasingly choosing to step in to help make developments and other projects viable in the current economic climate.

Other public bodies distributing public funds for economic activity or bodies being in receipt of such funds also need to be alert to the State aid rules and their status as economic actors even where transactions are between public bodies.

Properly covering off the State aid issues will help you to avoid the unpleasant consequences which can follow from unlawful State aid. These include an obligation to recover the unlawful aid from the recipient, potentially having to restructure the entire project, the possibility of damages claims by disgruntled parties who have been adversely affected and reputational damage.

We can help:

  • Analyse your project to determine whether there is, or could be, State aid.
  • Advise which particular rules and guidance apply to the aid. This varies depending on the type of aid, the industry sector and the recipient.
  • Help you ensure that your project complies with the rules. The method will vary from case by case but could, for example, involve scoping an independent economic report to demonstrate that a project is on market terms, structuring the project in a particular way to fit it within either an exemption or an authorised scheme or modifying the project so that it no longer involves State aid.
  • Provide appropriate wording for your project documents to ensure the correct State aid treatment can be claimed, and to provide you with certain contractual protections (such as a clawback clause).
  • Assist you to notify aid to the European Commission for authorisation, should this be necessary.

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Bethan Lloyd


Partner, Cardiff

+44 (0)29 2039 1890