Europaudvalget 2020-21
EUU Alm.del Bilag 201
Offentligt
2312426_0001.png
NOTAT
8. december 2020
Danish response to Commission’s roadmap on the revision of the
Communication on important projects of common European Interest
The Danish Government appreciates the opportunity to comment on the
European Commission’s roadmap on revision of Communication on im-
portant projects of common European Interest (IPCEI).
The Danish Government strongly welcomes the intention of the Commis-
sion to limit the scope of the revision to the three main adjustments foreseen
in the roadmap on 1) providing further guidance on criteria in the commu-
nication, including the Green Deal, 2) facilitating the involvement for
SME’s and
3) ensuring that the process is genuinely transparent and inclu-
sive.
In general, we see a benefit in reviewing and updating the state aid guide-
lines, in order to take into account the above-mentioned three priorities in
order to support the Union’s objectives, especially including the green and
digital transition. The Danish Government finds that the current communi-
cation on IPCEI (2014/C 188/02) has contributed in a positive way to pro-
vide helpful guidelines for Member States when preparing schemes for an
approval process that is as smooth and quick as possible, while ensuring a
strict use and application of IPCEI. The upcoming revision should not lead
to a general relaxation of the rules or an undermining of the Commissions
objective assessment of notified projects.
Indicatives in the roadmap
Further guidance
–
contributing to the green transition
We believe that the Communication on IPCEI can play a role in relation to
fulfil and meet EU’s energy and climate targets. Therefore, a key priority
should be to maintain its supporting role, also in the context of the Euro-
pean Green Deal and the objective to decarbonize the EU energy systems
as a mean to combat climate change and to promote a more sustainable
economy and society as a whole. We therefore support further guidance
and clarification on the application of the criteria for environmental, energy
and transport projects.
 EUU, Alm.del - 2020-21 - Bilag 201: Notat samt høringssvar vedrørende Kommissionens høring vedrørende revision af meddelelsen om Vigtige Projekter af Fælleseuropæisk Interesse
2/4
In general, we believe that IPCEI should be allowed to pursue other objec-
tives beyond climate and environmental objectives. However, IPCEI re-
lated to
industrial projects
(including but not limited to those supporting
strategic value chains) should to a greater extent be oriented towards con-
tributing to one of the EU’s climate objectives. The 2014 communication
already states that projects must contribute in a concrete, clear and identi-
fiable manner to one or more EU objectives. We suggest attaching higher
significance to this criterion for projects to contribute to a climate neutral
economy in the EU by 2050 at the latest, in the Commission’s
assessment
of IPCEI related to industrial projects, by giving it precedence over other
EU objectives, i.e. exalting the criterion. In addition, the focus of IPCEI
related to industrial projects should continue to be on enabling research,
development and breakthrough innovation.
We would refer
to the Danish Government’s
response of 20
th
of November
on how the competition policy can support the Green Deal.
Finally, we welcome the intention of referring to the Digital Strategy. The
revision should enable the development of state-of-the-art digital technol-
ogies through the use of IPCEI. However, always in the case of a market
failure and projects going beyond the aim of catching up with the techno-
logical developments globally.
Involvement of SMEs
We are very supportive of the aim of the Commission to enhance the par-
ticipation of SMEs in IPCEI. We find it essential to ensure a transparent
and inclusive process when establishing IPCEI related to industrial projects
that allows for stakeholders and companies of all sizes to participate and
contribute in order to ensure the best possible projects.
As noted in the roadmap, SMEs generally receive smaller amounts of aid
given their smaller size. This aid is therefore in general less likely to distort
competition. SMEs make up around 99 pct. of all European businesses.
Overall, we find that the issues related to the involvement of SMEs are
twofold. Firstly, experience from previous IPCEI seem to indicate a lack of
incentive for both Member States and large companies to involve SMEs in
the first place. In this regard, we are supportive of encouraging large busi-
nesses to involve SMEs in their projects, including from other Member
States, through better incentives. Such incentives could take the form of
specific benefits in case SMEs are involved or the involvement of SMEs
could be listed more explicit as a positive indicator than is currently the
case cf. Article 20 (e). In addition, higher aid intensity could be allowed for
SMEs than for larger businesses in order to increase the incentive for SMEs
to participate.
 EUU, Alm.del - 2020-21 - Bilag 201: Notat samt høringssvar vedrørende Kommissionens høring vedrørende revision af meddelelsen om Vigtige Projekter af Fælleseuropæisk Interesse
3/4
Secondly, SMEs do not have the same administrative capacity compared
to lager companies to go through a long application process required in
order to recive the aid under the IPCEI Communication. Thus, we are open
towards introducing an explicit principle of proportionality in the notifica-
tions process, making it less burdensome for SMEs to apply for the aid
through an IPCEI.
Transparency and inclusiveness
It is the Danish opinion that IPCEI related to industrial projects granted
state aid should be open for participation of interested undertakings from
all EU Member states. Currently there is no clear procedure for how Mem-
ber States can coordinate and cooperate on IPCEI in advance of the state
aid assessment.
The work of Industrial Alliances is a step in the right direction in terms of
improving transparency and inclusiveness in the early stages of establish-
ing an IPCEI for industrial development. However, we believe that more
can be done in order to safeguard that all Member States are given an op-
portunity to participate.
Building on the already existing positive indications of making it possible
for all interested Member States to participate (article 20 (a)) and on the
recommendation of the Strategic Forum for IPCEI to increase the transpar-
ency and inclusiveness of IPCEI, we suggest a formalised process where
all Member States are provided with project descriptions well in advance
before a formal state aid (pre-)notification is sent to the Commission, if no
prior consultation or invitation for possible participation have been pro-
vided earlier to all Member States.
Preserve fundamental market-based principal
When large cross border projects with clear common European added value
–
not including infrastructural projects
–
entail such big risks that private
investors are not willing to take them alone or considered unprofitable it is
important that the states involved have the opportunity to grant state aid.
However, such state aid should stimulate additional private investments
and not distort competition in a disproportional way.
This is especially pronounced when dealing with big projects and poten-
tially large amounts of state aid there is a potential for substantial distortion
of the competition in the internal market. Therefore, the Danish Govern-
ment finds it important, that state aid for IPCEI in particular is assessed
thoroughly by the Commission in a manner where the balance test is carried
out on a solid and well-informed foundation of information. If the Com-
mission has to compromise on the thoroughness and quality of the assess-
ment it may should consider opening the formal investigation procedure
 EUU, Alm.del - 2020-21 - Bilag 201: Notat samt høringssvar vedrørende Kommissionens høring vedrørende revision af meddelelsen om Vigtige Projekter af Fælleseuropæisk Interesse
4/4
prior to state aid approval in order to avoid this formality being challenged
in court thereby making the process slower.
In addition, the Commission should continue to apply the market-based
principles in the communication, meaning that IPCEI can only be used to
overcome market or systemic failures or to address societal challenges that
cannot otherwise be addressed. Moving forward, we must maintain this ra-
tionale, which should continue to be the guiding principle when assessing
the eligibility of aid under the IPCEI Communication. Member States and
the Commission have a joint responsibility to ensure that IPCEI do not un-
dermine effective markets. They should also not spur protectionism that
might reduce European businesses’ access to global value chains.
In addi-
tion, they should not only benefit the participating undertakings, but also
contribute to the EU’s overarching
objectives, including through positive
spill-overs to other Member States or sectors.
Finally, it is important that the category of activities eligible to receive state
aid under the IPCEI Communication is not expanded beyond first industrial
deployment. Hence, eligible activities and projects should continue to be
limited to research, development, upscaling of pilot facilities or to the first-
in-kind deployment.
Monitor and evaluate the outcome
The Commission should continue to assess and monitor the ex-post
changes in the behaviour of the participating undertakings as well as gen-
eral market changes resulting from the provided state aid, including market
foreclosure and dominance or risk of initiation of a subsidy race between
Member States.
In line with the communication from 2014, projects should continue to be
subject to regular monitoring. Results of IPCEI should - to the largest pos-
sible extent - be made publicly available to build upon and learn from in
order
to support further innovation and strengthening the EU’s global com-
petitiveness.
When reviewing the rules, and especially related to industrial projects, we
must remember that there at this point in time relatively little experience in
terms of the effect of IPCEI on supporting industrial development and com-
petitiveness. Therefore, we would encourage the Commission to present an
overall evaluation of the use of the IPCEI to industrial projects in 2025 at
the latest. This should include
the effect on EU’s global competitiveness,
description of participants (e.g. large vs. small countries and companies
alike) and (potential) distortionary effects both within the Single Market
and externally.