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The European Commission has approved, under EU State aid rules, a €700 million French scheme to support research, development and innovation projects by companies of all sizes and active across all sectors. This measure is part of the “France 2030” recovery program that aims to develop industrial competitiveness and future technologies, in order to enhance economic recovery in the aftermath of the coronavirus pandemic. The scheme also contributes to the EU's strategic objectives relating to the digital and green transitions.

 Executive Vice-President Margrethe Vestager, in charge of competition policy, recently said:

“This €700 million French scheme will facilitate research, development and innovation in the context of the recovery from the coronavirus pandemic. The scheme allows for research, development and innovation in energy transition and environmental protection, digital transition, innovations in production processes, and research necessary to support the continued functioning of European value chain and the security of supply. It comes with safeguards to make sure that possible distortions of competition are kept to the minimum.”

The French scheme

France notified to the Commission its intention to introduce a €700 million scheme to support two types of measures: (i) aid for research and development projects, and (ii) aid for process and organizational innovation. 

Under the scheme, which will be in place until 31 December 2023, the support will take the form of direct grants, soft loans and repayable advances.

The scheme applies to the following four thematic areas of research, development and innovation (‘RDI'): (i) energy transition and environmental protection, (ii) digital transition, (iii) innovations in production processes, and (iv) research necessary to support the continued functioning of European value chain and the security of supply.

The Commission's assessment

The Commission assessed the scheme under the EU State aid rules, and in particular under the 2014 Framework for State aid for research and development and innovation (‘RDIF'), which enables Member States to grant aid for industrial research, experimental development, feasibility studies, and process and organisational innovation, as well as under Article 107(3)(b) TFEU and in particular with the general principles included in the COVID State aid Temporary Framework.

The Commission found that:

• The scheme is necessary to facilitate RDI projects and has an incentive effect, as the projects would not take place in the absence of public support.
• The aid is proportionate and limited to the minimum necessary to ensure that the RDI projects are carried out.
• The aid will be granted before 1 January 2024.
• The necessary safeguards to limit distortions of competition are in place. In particular, there will not be an excessive sectoral focus, the overall aid amount per beneficiary is limited, research results will be widely disseminated and will not lead to intellectual property rights, the aid will not lead to overcapacity or to dominant positions.
• The positive effects of the measure outweigh any negative effects in terms of possible distortions of competition.

On this basis, the Commission approved the scheme under EU State aid rules.

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