Subsidy Control Bill published

 

Subsidy Control Bill published

The government has introduced the Subsidy Control Bill to Parliament.

BEIS has also published the government's response to its February 2021 consultation on the proposed design of the new UK regime.

BEIS expects to publish further details on implementation and guidance.  The government expects that the new regime will come into force in 2022, subject to Parliamentary approval.

The Subsidy Control Bill sets out the framework for a UK subsidy control regime that meets the UK's international commitments including those in the UK-EU Trade and Co-operation Agreement.  This reflects the following main features:

·       Public authorities must consider seven subsidy control principles before deciding to award a subsidy/make a subsidy scheme and the subsidy/subsidy scheme must be compatible with those principles.  

·       Exemptions for certain types of subsidy, including those with a value below £350,000, services of public economic interest assistance below £725,000, natural disasters and other exceptional circumstances, and national and global economic emergencies.

·       Certain types of subsidy will be prohibited, or only permitted subject to specified conditions.

·       Transparency requirements relating to the award of subsidies/making a subsidy scheme.

·       A Subsidy Advice Unit (SAU) will be set up within the Competition and Markets Authority (CMA), with the functions of monitoring and oversight, and providing pre-award and post-award advice.

·       The Secretary of State develop a streamlined approach for subsidies at low risk of distorting competition, trade and investment; that promote the government’s strategic objectives; and which the government assesses to be compliant with the principles.  This will be set out in guidance.

·       The Secretary of State will, in secondary legislation, designate some types of subsidy as "subsidies of interest" or "subsidies of particular interest".  

·       Public authorities can ask the SAU to provide advice on subsidies of interest (voluntary referral) and must ask the SAU to provide advice on subsidies of particular interest (mandatory referral).

·       The Secretary of State can “call in” a subsidy or scheme before it is granted or made, requiring it to be referred to the SAU.

·       The CMA SAU also be asked to provide post-award reports on subsidies.

·       The Competition Appeal Tribunal (CAT) will hear appeals by interested parties (or the Secretary of State) against subsidy decisions, using judicial review principles.

·       The CAT will be able to make recovery orders.

 

BEIS press release:  https://www.gov.uk/government/news/new-subsidy-system-to-support-uk-jobs-and-businesses-boost-the-economy-and-strengthen-the-union

Subsidy Control Bill:  https://www.gov.uk/government/collections/subsidy-control-bill