Part II The Notion of State Aid, 7 European Structural and Investment Funds and State Aid Control: Two Policies at Odds with Each Other?

Abstract

This chapter looks at the relationship between the European Structural and Investment (ESI) Funds and State aids, two conflicting but often complementary policy areas, both in conceptual but also in practical terms. There is a fundamental uncertainty surrounding the qualification of ‘EU Funds’ as State aids which can be attributed in part to the complex legal contours and administrative structure of the ‘EU Funds’ and the shared management that governs this policy, and in part to the absence of clear rules with respect to the relationship between ESI Funds and State aids. The complex procedures underpinning the ESI Funds have inevitably blurred the lines between the responsibilities and the powers of the EU and the Member States. At the same time, evidence shows that the complex rules that govern the ESI Funds and the constraints imposed by State aid compliance might frustrate EU Cohesion policy purposes.