29 - STATE AID - 1)

Shall a Partner - that is not an undertaking and that has marked “NO” to the point 16 (of the LP declaration) or 17 (of the PP declaration) - answer “NO ” as well to the following question (at point 17 of LP declaration or 18 of PP declaration) ”in the context of the project proposal, the organization I represent carries out economic activities that are potentially State Aid relevant” as it doesn’t carry our any economic activities? Or otherwise shouldn’t it tick anything because it has already stated before that it is not an undertaking?

​​​​​​​In order to be considered State Aid relevant, a funded activity must fulfill all the 5 criteria as inferable from the definition of State Aid provided in the Article 107(1) of the Treaty on the Functioning of the European Union, among which one consists of an advantage to the undertaking given by the aid measure.

In order to clearly define their position, all the applicants (both LP and PP) are requested to specify in the LP and PP declaration, if:

Firstly, they act, in the context of the project, as an "undertaking" performing economic activities;
Secondly, they receive a selective advantage by participating in the project.

Therefore applicants are requested to tick “NO” in both the points of the LP and PP declarations as assumed in the question above, in order to highlight they are not undertaking and carrying out economic activities that are potentially State Aid relevant.

Consequently, applicants shall fill in the following point 19) only if 17) is “undertaking” and 18) is “YES”.

Moreover, the State Aid relevance of a project activity must be taken into consideration not only focusing on the benefit for beneficiaries but also in terms of “indirect state aid”: i.e. the involvement of project partners granting State aid “downstream” to other organizations. Such aid would only be deemed to be State aid in the case beneficiaries offer marketable services to undertakings. This might include offering free services to undertakings (e.g. SMEs) they would otherwise have to pay for. In such a case State aAid will be deemed to be granted by beneficiaries and they would be required to meet the State Aid requirements (e.g. ask for de minimis self declarations, keep the register and inform SMEs about the amounts granted).

Beneficiaries bear the responsibility to ensure that State Aid rules are respected also by third parties. Alternatively, the project partners might exclude State Aid relevant activities by charging market prices for services offered to SMEs, or by excluding selectivity i.e. offering services to all interested SMEs.