Explanatory note
(This note is not part of the Regulations)
These Regulations are made in exercise of the powers in section 8(1) of, and paragraph 21 of Schedule 7 to, the European Union (Withdrawal) Act 2018 (c.16) (the Act) in order to address failures of retained EU law to operate effectively and other deficiencies (in particular under section 8(2)(a), (b), (d) and (g)) arising from the withdrawal of the United Kingdom from the European Union.
These Regulations make amendments to legislation in the field of state aid. The main amendments made by these Regulations include—
transferring state aid regulatory functions of the European Commission to the Competition and Markets Authority (CMA);
replacing references to the European Commission assessing compatibility of state aid with the internal market to the CMA deciding whether to approve state aid;
replacing the test of whether state aid affects trade between Member States with a test of whether state aid affects trade between the United Kingdom and the European Union;
restating large parts of the EU procedural provisions with appropriate deficiency corrections.
Part 2 amends retained EU law relating to the state aid framework that continues to be, or forms part of, domestic law by virtue of section 4 of the Act.
Parts 3 to 6, and Chapter 1 of Part 7, amend retained EU law relating to procedural and enforcement matters that continue to be, or form part of, domestic law by virtue of section 3 of the Act. In summary, Part 3 sets out the process for the CMA to examine notified aid, unlawful aid, misused aid and existing aid schemes. Part 4 includes provisions relating to enforcement. Part 5 includes provisions relating to monitoring and reporting of aid. Part 6 requires the CMA to adopt and publish statements of policy. Chapter 1 of Part 7 includes general provisions relating to aid in urgent cases, interest rates and time periods.
Chapter 2 of Part 7 revokes certain retained EU law, inserts a schedule that contains transitional provisions and inserts schedules that make amendments to retained EU law and other legislation. In particular, Schedule 8 includes transitional provisions setting out how these Regulations apply in relation to aid granted before exit day. Schedule 9 contains amendments to the General Block Exemption Regulation and Schedule 10 contains amendments to other legislation, including the Enterprise Act 2002 (c.40) and the Enterprise and Regulatory Reform Act 2013 (c.24).
An impact assessment has not been produced for this instrument as no, or no significant, impact on the private or voluntary sector is foreseen.