Support of Small and Medium-Sized Enterprises under European State Aid Law

Small and medium-sized enterprises (SMEs) play a crucial role in the economic development strategy of the European Union. However, while SMEs are important for job creation and economic development, the Commission has highlighted that they often encounter problems accessing finance and necessary information. In order to address certain market failures which impact SMEs most significantly, SMEs now have a favoured status under the state aid rules. The most important and recent changes are a consequence of the Commission’s state aid modernization (SAM) reform package. As part of the SAM package, the Commission has adopted ten guidelines and five regulations to render existing state aid control instruments and procedures more efficient. This chapter gives a brief but practical overview of those new guidelines and regulations and highlights the core principles that need to be taken into account when assessing aid possibilities for SMEs.