Considerations for state aid recipients in Romania

Considerations for aid recipients

Is there a legal right for businesses to obtain state aid or is the granting of aid completely within the authorities’ discretion?

Under Romanian law, there is no legal right to state aid.

In theory, however, an undertaking submitting an application for a state aid measure based on a state aid scheme, and meeting all requirements thereof could, under certain circumstances, challenge the administrative deed refusing to grant the aid or the lack of a response regarding the application, as the case may be.

What are the main criteria the national authorities will consider before making an award?

There are several types of eligibility criteria based on which the award of state aid is customarily made, such as with respect to the relevant projects, activities, beneficiaries and expenses.

Eligibility criteria are usually quite numerous, being established by the state aid provider on a case-by-case basis, in keeping with the types of projects it wishes to finance, its own objectives and indicators as well as GBER requirements where needed, and other applicable EU rules.

For instance, recent state aid schemes encompassed criteria referring to, among other things, amount of investment, economic efficiency, job creation and amount of taxes generated for the budget.

What are the main strategic considerations and best practices for successful applications for aid?

The success of an application essentially depends on the fulfilment of all the conditions for the award of that specific state aid.

In terms of best practices, special attention should be paid to, among other things, the period when an application can be made, which is not always obvious from the terms of the relevant schemes. In addition, as criteria and procedures are not always clear, further explanations should be sought where needed from the relevant departments of the aid providers. Thus, any potential applicant should maintain close contact with the relevant department of the state aid provider and closely follow the relevant sources of information.

In addition, where a form of aid (advantage) from public sources that is not encompassed by a specific state aid scheme (approved by the Commission or exempted based on the GBER) is being sought, one should always assess whether the aid meets the conditions to be deemed as lawful (including where applicable the relevant prior notification to the Commission). This is because public authorities may not always know in detail the state aid rules and could potentially offer various forms of aid without first considering state aid compliance matters.

How may unsuccessful applicants challenge national authorities’ refusal to grant aid?

Challenges against state aid refusals are not frequent. There is also no generally applicable specific procedure with respect to the possibility for unsuccessful applicants to challenge a refusal to grant state aid.

Unsuccessful applicants may challenge such a decision according to the common rules of administrative litigation should they be able to prove that the administrative document granting the state aid (as the case may be) has prejudiced them.

To what extent is the aid recipient involved in the EU investigation and notification process?

The process with respect to the EU notification and investigation is coordinated by the Competition Council. State aid providers, state aid beneficiaries and the initiators of the state aid, as well as any other undertakings, are under obligation to provide the Competition Council with any information necessary for the proceedings before the Commission, in the time frame set by same. Also, in practice, the aid recipients are heavily involved in the relevant proceedings, to the extent required to provide the relevant information and to provide drafts of the relevant documents to be sent to the Commission. Where necessary, they can also be called on to attend meetings. Access to the actual file may, however, be denied on the grounds of confidentiality of exchanges with the Commission.