The European Commission (EC) has proposed a regulation on R&D aid in favour of small and medium sized enterprises (SMEs). The regulation is aimed at simplifying Member States’ research and development initiatives.
Under this regulation EC Member States may grant aid for research and development for SMEs without having to notify them beforehand, or seek the Commission’s prior clearance.
The proposal foresees that Member States may cover up to 100% of expenses for fundamental (basic, non market-oriented) research, 60% for industrial (market-oriented) research and 35% for pre-competitive development.
Commenting on the proposal European Competition Commissioner Mario Monti said: ‘The proposed regulation will enable a speedier implementation of the research and development measures taken by the Member States in favour of SMEs. It will remove the need to notify the Commission of all measures taken that comply with the terms and conditions as set forth in the Regulation.
‘It follows the Commission’s aim to simplify and streamline the State aid rules and eliminate unnecessary paper work. It is the first time that the Commission foresees for a block exemption of research and development aid. This is to be seen as a response to the Lisbon objective to promote research and development and to the recently adopted Action Plan to increase research and development spending to 3% of GDP by the end of 2010.’
European Research Commissioner Philippe Busquin added: ‘Research in Europe has to face an uphill struggle: lack of co-ordination, insufficient public support, difficult access to capital, and unfriendly fiscal, legislative and regulatory frameworks hamper European R&D effectiveness.
‘To become the most competitive knowledge-based economy in the world we have to remove these stumbling blocks. The 3% objective can only be achieved if we succeed in creating research-conducive conditions in Europe. State aids play an important role in this.’
With the proposed regulation the Commission is launching a consultation process with Member States, to gather their advice on the proposal to exempt R&D aid for SMEs as a group.
Apart from the aid for R&D, the proposal also foresees exempting, under certain conditions, aid for technical feasibility studies and aid for patenting costs.
Following the consultation with the Member States the Commission will adopt the regulation at the end of this year.
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