Speaking at the European Commission's first Competition Forum in Brussels today, Almunia will outline ways in which he wants the system overhauled better to meet the requirements of the EU's single market.
State aid has figured prominently in EU Member States' responses to the financial crisis. The Commission has introduced emergency measures that allow governments to prop up their financial sectors. However, there is an acknowledgement within the Commission that there must be a more radical overhaul of the system if it is to be used more effectively. One EU official said that the changes likely to be proposed would be the “most far-reaching reform of state-aid control in 50 years”.
The Commission has extensive powers to police Member States' use of state aid. At the moment, a country must notify the Commission every time it decides to provide state aid, and then must wait for the Commission's approval. Under the current regime, there is no distinction between state aid that will have a great impact on competition and aid that will have relatively little.
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