State aid to banks (IVOR nr. 109) 2018/8.1.5:8.1.5 Scope of this chapter

State aid to banks (IVOR nr. 109) 2018/8.1.5

8.1.5 Scope of this chapter

Deze functie is alleen te gebruiken als je bent ingelogd.Deze functie is alleen te gebruiken als je bent ingelogd.Deze functie is alleen te gebruiken als je bent ingelogd.

Chapter 3 introduced the three main types of State aid measures: recapitalisation measures, guarantee measures and asset relief measures. The compatibility of asset relief measures is based on a very specific assessment framework: the Impaired Assets Communication (IAC). For this reason, the compatibility of asset relief measures will be discussed in the following chapter, while the current chapter focusses on the compatibility of recapitalisation measures and guarantee measures.

Part I Appropriateness

The first of the three compatibility-criteria is the criterion that the aid should be appropriate. When is aid “appropriate”? Appropriateness is defined as follows:

“The aid has to be well-targeted in order to be able to effectively achieve the objective of remedying a serious disturbance in the economy. This would not be the case if the disturbance would also disappear in the absence of the measure or if the measure is not appropriate to remedy the disturbance.”

This definition figures in every decision in which the appropriateness of the State aid is assessed. A central element in the definition of appropriateness is ‘a serious disturbance in the economy’. This element was also relevant in the context of the choice of legal basis for the compatibility-assessment. As was explained in the previous chapter, this element relates to the fact that the bank has systemic importance. Moreover, the aid measures should restore market confidence. These relevant characteristics will be discussed in sections 8.2 and 8.3.

Furthermore, it should be recalled that State aid can be granted ad hoc or under a bank support scheme. In the latter case, the assessment of the appropriateness of the aid takes place in the decision in which the bank support scheme is approved. For the interpretation of “appropriateness”, it does not matter if the State aid is granted under the scheme or as individual aid. However, in case of a scheme, there is a factor that is taken into account by the Commission: the eligibility to the scheme, which will be discussed in section 8.10.

Deze functie is alleen te gebruiken als je bent ingelogd.