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Abstract
State aid control is evolving rapidly to meet the challenges posed by the changing economic
and geopolitical context resulting from the 2004 enlargement and the adoption of the
Lisbon agenda. In parallel with the wholesale review of State aid policy, significant changes
to EU Cohesion policy post-2006 are also under discussion. The Commission emphasis on
policy ‘coherence’ between national regional and EU cohesion policies means that the
review of regional aid control has had to straddle the reforms of both EU State aid and EU
Cohesion policy.
The current regional aid guidelines expire at the end of 2006; since 2003, the Commission
has been considering how to replace them. Following protracted negotiations, in July 2005
the Commission published Draft Guidelines on Regional Aid for further discussion. This
paper traces the history of the Draft, assessing the impact of the various proposals on the
Member States and the impact of the Member States on Commission policy. It argues that
agreement can now relatively easily be reached on the Draft, but that some outstanding
issues remain, in particular: whether revised GDP data will be used in determining final
coverage and the impact of updated statistical information; how the challenges of
operationalising area designation at the national level can be met; whether the
Commission’s ambition of ‘coherent’ national and EU Cohesion policy maps can be
achieved; and how the relationship between horizontal State aids and the assisted areas
will evolve.
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