State Aid

As Article 107 (1) of the Treaty on the Functioning of the European Union does not provide a specific definition of state aid, the following criteria must be considered when deciding whether aid can be deemed to be state aid:

• aid is granted from state, city, or rural municipality funds;
• aid measure is selective in nature, i.e., it is targeted at a specific undertaking, group of undertakings, or to produce certain goods;
• aid measure confers an advantage to the beneficiary;
• aid measure distorts or threatens to distort competition and trade between European Union Member States.

If the aid meets all four criteria, it constitutes state aid. How to recognize state aid - see the Frequently asked questions (FAQ) on State aid.

De minimis aid is small-scale aid which the does not affect competition between Member States. For more information on de minimis aid, see: https://riigihanked-riigiabi-osalused-kinnisvara/riigiabi/vahese-tahtsusega-abi/ (in Estonian)

State aid and de minimis aid may be granted in various forms such as grants, soft loans, guarantees, capital injections, tax exemptions, etc.

Chapter 6 of the Competition Act sets out the national rules for the procedure for granting state aid.

To grant state aid, the grantor must submit a state aid notification to the European Commission in accordance with the provisions of the Competition Act. State aid can only be granted after the positive decision of the European Commission (except de minimis aid and State aid granted on the basis of European Commission's block exemption regulations).