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On 28 October, the European Commission adopted an amendment to the State aid Temporary Crisis Framework to enable Member States to continue to use the flexibility foreseen under State aid rules to support the economy in the context of Russia's war against Ukraine. For reference, the Framework was first adopted on 23 March, and amended in July. The Commission had consulted Member States in October on a draft proposal to adjust the Framework.

This new amendment takes into account Member States’ comments which have been consulted last month as well as the latest policy developments at EU level, such as the Regulation (EU) 2022/1854 introducing an emergency intervention to tackle high energy prices and the Commission proposal to address high gas prices and ensure supply security this winter The Commission introduced several amendments to the Framework, including:

• The prolongation of all measures set out in the Temporary Crisis Framework until 31 December 2023.
• The increase of the ceilings set out for limited amounts of aid up to €2 million (from €500,000 in the previous amendment) for companies active in all sectors excluding agriculture fisheries and aquaculture.
• The increase of flexibility and support possibilities for companies affected by rising energy costs, subject to safeguards. Member States will be entitled to calculate support based on either past or present consumption, taking into account the need to keep intact market incentives to reduce energy consumption and to ensure the continuity of economic activities. For companies receiving larger aid amounts, the Temporary Crisis Framework foresees commitments to set a path towards reducing the carbon footprint of energy consumption and implementing energy efficiency measures.
• The introduction of new measures aimed at supporting electricity demand reduction, in line with the new Regulation (EU) 2022/1854 introducing an emergency intervention to tackle high energy prices.
• A clarification of the criteria for the assessment of recapitalisation support measures. In particular, such solvency support would have to be (i) necessary, appropriate and proportionate; (ii) involve adequate remuneration of the State; and (iii) be accompanied by appropriate competition measures to preserve effective competition, including a ban on dividend and bonus payments and acquisitions.

Source: European Commission