{"id":243905,"date":"2021-02-15T18:53:08","date_gmt":"2021-02-15T13:23:08","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=243905"},"modified":"2021-07-30T10:06:11","modified_gmt":"2021-07-30T04:36:11","slug":"united-kingdom-consultation-on-new-regime-on-subsidy-control-introduced","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2021\/02\/15\/united-kingdom-consultation-on-new-regime-on-subsidy-control-introduced\/","title":{"rendered":"United Kingdom | Consultation on New Regime on Subsidy Control, introduced"},"content":{"rendered":"

With the advent end of transition period on 31st<\/sup> December, 2020, following the exit of UK from EU, the UK Government\u2019s Department for Business, Energy & Industrial Strategy announced to consult on the creation of a new national subsidy control system on 3rd<\/sup> February, 2021[1]<\/a>. This is the Consultation[2]<\/a> as State Aid Rules were one of the three final issues that held up the agreement of the EU-UK Trade and Cooperation Agreement (TCA).<\/p>\n

The Government seeks views from businesses and business representative organisations, subsidy granters, legal advisers and all other parties interested in subsidy control. Alongside digital responses, the Government intends to hold stakeholder engagement events on a number of topics during the consultation period. The Consultation[3]<\/a> consists of three chapters, setting out the options available to the UK to design a bespoke subsidy control regime.<\/p>\n

According to the Secretary for State for Business, Energy and Industrial Strategy:<\/p>\n

\u201cThis consultation sets out the future of the UK\u2019s subsidy control regime \u2013 a regime that will set out a clear and transparent set of principles and guidelines, ensuring that public authorities at all levels of government fully understand their legal obligations, and which will allow businesses to make long-term investment decisions on that basis.\u201d<\/em><\/span><\/p>\n

BACKGROUND<\/strong><\/p>\n

The introduction of this Consultation invites views on the best ways to design the new subsidy control regime fulfilling the international obligations of UK with respect to World Trade Organisation (WTO), Free Trade Agreements (FTA), UK- EU Trade and Co-operation Agreement and the Protocol of Ireland and the withdrawal agreement. Subject to the outcomes of this consultation, the Government will bring forward a primary legislation to establish a system of subsidy control that works for the whole of the UK. Subsidies are administered by all levels of government in the UK. The Government stresses that the new Regime, while encouraging the local authorities and administrations to take localized decisions, must avoid subsidy races which might distort competition between the UK nations.<\/p>\n

Salient Features of the Consultation:<\/strong><\/p>\n

The Consultation consists of 43 questions dealing across a range of areas. The key topics referred are hereinbelow:<\/p>\n

    \n
  1. The Government considers that there are four key characteristics of a subsidy. A support measure must meet all of these to be classified as a subsidy for the purposes of any regime:<\/li>\n<\/ol>\n