Competition: State aid - Council agrees codified rules on procedure

United Kingdom

On 16th November 1998 the Council of Ministers reached agreement on the regulation presented by the Commission regarding procedure for state aid. This means that all the rules will now be contained in one single, coherent and binding text rather than be scattered among the practice of the Commission and case law of the European Court of Justice.

The regulation also gives the Commission wider powers against abuses of the system and instances of illegal aid. The new powers allow the Commission to order the immediate provisional refunding of illegally paid state aid and to carry out on-the-spot inspections where there is some doubt as to the compatibility of the aid with the Community rules. The general emphasis on more effective control is hoped to ensure more universal compliance with the regulations.

The regulation will be formally adopted after the European Parliament has given its opinion.