EU to provide state aid to companies in response to US subsidies
2022.12.13 12:28
EU to provide state aid to companies in response to US subsidies
Budrigannews.com – With plans for a European fund in the future, the European Commission wants to know if the 27-country bloc needs to relax state aid regulations in order for governments to support businesses affected by the U.S. Inflation Reduction Act.
There are concerns that the $430 billion bill, which provides tax credits to consumers for green products like electric vehicles (EVs) produced in the United States, could disadvantage businesses in the European Union and encourage them to relocate to the United States.
Others point to the billions of euros that have already been pumped into businesses in recent years to combat the COVID-19 pandemic and the effects of the war in Ukraine, while Germany, France, Italy, and others have called for additional subsidies or a similar EU law.
Two people familiar with the situation told Reuters earlier that the EU executive will ask countries if the temporary crisis framework, which was adopted in March for businesses affected by the war in Ukraine, should be extended to companies affected by the U.S. subsidy law.
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The Commission confirmed that it began the consultation on Tuesday with the intention of simplifying and making its rules for temporary state aid more predictable in order to accelerate public investment in green sectors.
“To express it in the expressions of Chief VP (Margrethe) Vestager, the ongoing setting calls for additional improvement of standards for ventures and shutting existing holes to focus overall worth chain of vital green areas including unrefined substances,” a Commission representative said.
“At the same time, we will work in the mid-term toward a European fund to support such strategic investments in order to protect our level playing field in the single market.”
