State Aid and Brexit
Sheffield Innovation Programme (SIP) is part-financed by the European Regional Development Fund and support provided by the programme is classified as State Aid, delivered through De Minimis (EC regulation No 1407/2013).
The ERDF programme is covered by Article 138 of the Withdrawal Agreement. This requires that the ERDF programme continues to be delivered in accordance with all applicable EU law for the remainder of the programme. This means the ERDF requirements regarding state aid remain exactly as before the UK left the EU.
However, as of the 1 January 2021, projects must take into account potential cumulation with UK subsidies which fall beneath the applicable threshold (expressed as Special Drawing Rights (SDRs)) of the new UK subsidy control regime (as set out under Article 3.2(4) of the UK-EU Trade and Cooperation Agreement (“TCA”), Chapter 3 (Subsidy Control)).
The total of De Minimis Aid and Special Drawing Rights should not exceed €200,000 as set out in Article 5 of the de minimis regulation.
For example, a company received:
- €100,000 of de minimis aid in 2019
- €50,000 of de minimis aid in 2020
- €25,000 of aid under the SDR system
It has received €175,000 of cumulated aid and may receive no more than €25,000 of de minimis aid within the limit of €200,000 of de minimis aid in three years.
Beneficiary SMEs must fully complete SIP Form 1 with details of state aid received in the last 3 years to allow assessment of eligibility, taking into account previous de minimis aid and subsidies considered SDRs, before the support commences. You may wish to seek your own expert advice on this.