The European Commission approved this Wednesday a state aid framework which will make it easier for European governments to give more aid to the agricultural, fishing, transport and energy-intensive industriesto face the increase in costs of fuel caused by the war in Middle East.
Since the war began caused by the bombings by Israel and the United States on Iranthe prices of gas and the oil have been shot. Brussels estimates that the increase in the bill for the purchase of energy has risen by 27,000 million of euros above usual. “We are losing almost 500 million a day,” said the president Ursula von der Leyen in a speech before the European Parliament.
Some industries are particularly exposed. The Community Executive will allow governments to foot part of the bill until December of this year. “The framework allows the State to grant aid to mitigate immediate adverse effects on the most exposed European companies, while preserving fair competition in the single market,” said Teresa Riberafirst vice president of the Commission, at a press conference.
Up to 50,000 euros
In the area ofagriculture, fishing, road, rail and waterway transportas well as short sea shipping, the bloc’s countries will be able to compensate “up to 70% of additional costs” due to the increase in fuel prices. Besides, In the case of agriculture, this also applies to fertilizers.
To calculate that percentage, governments must calculate the price increase, in relation to a historical reference price. In addition, the beneficiaries will have to account for their consumption. Brussels will facilitate the process for small and medium-sized businesses, particularly affected by the crisis.
That simplified option will allow governments to adjust the amount of aid depending on the size of the company and the type of activity, making an estimate of consumption. The objective is alleviate administrative burden for the beneficiaries. In this case, Brussels has established a maximum aid of 50,000 euros.
High energy consumption
For industries high energy consumptionthere is already the possibility of benefiting from aid plans for alleviate the impact of the boom in electricity prices, as a result of the increase in fuel costs. The Commission approved this Wednesday that the percentage of eligible electricity costs can be increased from 50% to 70% by governments in certain cases.
Governments that decide to make use of this extra flexibility must notify the Commission. The Community Executive must then analyze case by case. Brussels has insisted that this is a temporary framework, although the end date, In practice, it will depend on the duration and severity of the crisis.
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