Industrial policy and EU state aid rules

Abstract

This contribution explores the relationship between State aid rules and European industrial policy, based on the most representative Commission decisions and European Court of Justice judgments in this area throughout the history of EU integration. It investigates whether the control of domestic measures under State aid rules fits within a broader, coherent EU industrial policy or whether State aid control is the expression of a lack of EU competence in this respect. It then highlights how the evolution of State aid policy reflects the policy choices made by the EU. For a long time, the EU has used State aid policy tools to limit state intervention in the economy, in order to preserve "natural" competition between EU undertakings. However, in the last decade, EU institutions appear to have incorporated other objectives into State aid policy, such as the preservation of the financial system, the fight against tax competition and the promotion of environmentally friendly technologies. Although recent initiatives, such as IPCEIs and European funding facilities, reveal a growing ambition to set common industrial policy objectives oriented towards the green and digital transition, the role that State aid enforcement should play in this new scenario remains uncertain.