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Services of general economic interest

Services of general economic interest (SGEI) are services which the state wants to provide for the general public, but which are not adequately supplied by market forces alone.

The SGEI package (external link) is made up of the framework, block exemption regulation and de minimis regulation, all of which are different from the general state aid rules.

SGEI framework

The SGEI framework specifies the conditions under which state aid in the form of public service compensation is allowable.

To use the SGEI framework you first need to notify the European Commission (EC) of what you want to do and wait for their decision. For information on how to do this contact the State Aid Team: state.aid@wales.gsi.gov.uk

SGEI block exemption regulation

The SGEI block exemption regulation details the support which can be given without first notifying the EC. Aid given under this regulation must be supported by an act of entrustment.

SGEI de minimis regulation

The SGEI de minimis regulation covers aid amounts that are too small to affect competition - below €500,000 over a 3 year period (the current and last 2 fiscal years).

The granting authority must also write entrusting the service to the provider.

Giving SGEI de minimis aid

Your de minimis aid must not put the recipient over the €500,000 limit. You must ask them how much de minimis aid they have received in the current and previous 2 fiscal years. This must include industrial de minimis and SGEI de minimis.

You must not give a part award aid, eg. if a company asks for £10,000 but this takes them over the €500,000 threshold by £1,000 you can’t simply reduce the amount you give them to £9,000.

The EC has a dedicated currency convertor that must be used to calculate de minimis aid. The exchange rate applicable is the rate at the time of award.

You will also need to write to tell the recipient the value of the de minimis aid you’re giving them.

Receiving SGEI de minimis aid

Keep a careful record of the total de minimis aid received, If you are awarded more than €500,000 over this 3 year period you are breaching the rules and the EC could demand you pay it back.

You must declare the amount of SGEI de minimis aid you have received to any public or granting authority that asks. This will usually be because you have requested money from another scheme or public authority that is classed as de minimis aid.