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10 February 2023

Centre of European Law leads discussion on entry into force of Subsidy Control Act

Andrea Biondi, Director of the Centre of European Law (CEL), recently led a roundtable discussion at the House of Commons, about the Subsidy Control Act.

 Shot of House of Commons and Big Ben

The Subsidy Control Act (SCA) 2022, entered into full force on 4 January 2023. It provides a new framework for UK-wide subsidy control and represents one of the most extensive domestic legislative regulatory regimes in terms of control of public spending, replacing and overhauling the previous EU State Aid Laws.

Theoretically, it should usher in a more dynamic and less bureaucratic system to allow greater efficiency in the allocation of public resources, but broader questions were raised at the meeting about the impact of the new rules on public authorities. There was also consensus that the link between the SCA and the government’s levelling up agenda needs to be interrogated and explored further.

There is a compelling reason why rules on regulating subsides are necessary in a modern democracy: fairness. The existence of provisions on transparency and accountability of spending decisions are there to ensure UK geographical solidarity and at the same time to guarantee that all the different players compete on the basis of the same rules. The SCA is an opportunity to achieve both but there may be several obstacles to overcome

Andrea Biondi, Director of Centre of European Law (CEL).

The discussion focused on three main areas:

  1. New Roles and responsibilities for Public Authorities
  2. Solidarity and integration into the UK market
  3. SCA and international obligations

Other observations raised during the meeting, highlighted that the implementation of the SCA raised fundamental questions about whether public authorities have the necessary resources and expertise to decide if a certain measure is a subsidy; whether the lack of a specific regulator may affect the effectiveness of the system and the limited powers conferred to devolved authorities.

The roundtable, which was held on 17 January, was jointly organised by the CEL and the All- Party Group on Devolution, and was co-led by Catherine West MP, Vice Chair of the All-Party Group on Devolution.

Law makers, business representatives, local authorities and other stake holders were also in attendance.

The meeting forms part of ongoing research lead by Professor Biondi aimed at monitoring the application of the new SCA. A series of position papers will follow.

Subsidy control act roundtable image

In this story

Andrea Biondi

Professor of European Union Law