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Amount of the Business Partnership Support and De Minimis Aid

EU regulations regarding State Aid and Competition restrict and regulate state aids granted by the member states. A grant falls under this regulation if it fulfills all the following conditions stated in Article 87.1. of the Treaty establishing the European Community:

1. Public funds are channeled to public and private companies
2. A company gains financial benefit from the grant
3. Benefit is selective; it is targeted only at certain companies
4. The measure may distort trade and competition between member states

De minimis regulation allows member states to grant minor quantities of aid to private and especially SME-companies with an administratively light procedure and without having to notify the Commission. The regulation states that grant measures that exceed € 200,000 per group over a 3-year period, do not fall under this regulation.

Business Partnership Support granted by the Ministry for Foreign Affairs falls under the aforementioned regulation. In principle, Business Partnership Support is therefore granted as de minimis aid, to which the Commission Regulation (EC) No 1407/2013 on the application of Articles 107 and 108 of the Treaty on the functioning of the European Community to de minimis aid is applied. Under this regulation, companies and the groups they are part of can receive a maximum of € 200,000 of de minimis aid over a 3-year period.

Due to the public nature of Business Partnership Support, the applicant company´s name, sector and amount of support granted are public information.

As an exception to the main rule, limited amounts of de minimis aid can be granted to the following sectors:

• fisheries and aquaculture (de minimis limit of € 30,000)
• primary production of agricultural products (de minimis limit of € 15,000)
• transport sector (de minimis limit of € 100,000)

As an additional exception to the main rule, de minimis aid cannot be granted to the coal industry or for export subvention or favoring domestic products at the expense of export.

The applicant company must declare all the funding it has received from ministries, authorities that operate under ministries, regional Centres for Economic Development, Transport and the Environment (ELY) Centres, Tekes, Finnvera, municipalities or Finnish Regional Councils. The applicant is responsible for ensuring that the total of de minimis aid received does not exceed the maximum limits mentioned above.

If the applicant company finds that the project does not fall under the EU regulations regarding State Aid and Competition, the applicant shall give reasons for this. The company´s reasoning should be based on the following criterion of the ones mentioned above: The measure may distort trade and competition between member states.

Projects where the target market of the product or service as a whole is inside the European Economic Area (EEA), may distort trade within the EEA. This kind of a project cannot be granted an exception from the de minimis restriction. Projects where the target market as a whole is outside the European Economic Area (EEA), do not per se distort competition within the EEA. If the applicant finds that the produced goods or services as a whole are meant for outside the EEA and that the Support cannot affect trade or competition between member states, the company must sign a Letter of Agreement where they justify their point of view.

Based on the company´s reasoning, Finnfund can propose to the Ministry for Foreign Affairs that the Support in question would not fall under EU regulations regarding State Aid and can thus be granted without applying the de minimis restriction. The Ministry for Foreign Affairs makes the final decision.

If the Ministry for Foreign Affairs finds that the project in question does not fall under the de minimis restriction, a maximum of € 400,000 of Business Partnership Support can be allocated project.

The reimbursement request can only be submitted after the approved project expenses have accrued. The support is paid against approved, accrued and paid expenses.

Please, contact Finnpartnership for further information.