ANNOUNCEMENT 28 Apr 2022

In April 2022, the European Commission approved a Spanish production subsidy scheme to support milk producers in the context of higher input prices. The scheme forms part of the Spanish national response plan to the economic challenges caused by the Russian invasion of Ukraine adopted in March 2022 (see related state act).

 

NUMBER OF INTERVENTIONS

1

  • 1 harmful
  • 0 neutral
  • 0 liberalising

SOURCE

SA.102650 TCF: Aid for the increase in the costs of milk producers. Available at:
https://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_102650

European Commission's Decision. "Subject: State Aid SA.102650 (2022/N) – Spain. TCF: Aid for the increase in the costs of milk producers". 28/04/2022. Available at:
https://ec.europa.eu/competition/state_aid/cases1/202219/SA_102650_003F9380-0000-C26B-A028-2C3A6DC27B60_19_1.pdf

EUR-Lex, Official Journal of the EU. "Document 52022XC0520(04), Authorisation for State aid pursuant to Articles 107 and 108 of the Treaty on the Functioning of the European Union – Cases where the Commission raises no objections Text with EEA relevance". 20/05/2022. Available at:
https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=uriserv%3AOJ.C_.2022.204.01.0016.01.ENG&toc=OJ%3AC%3A2022%3A204%3ATOC

European Commission. Press release. "State aid: Commission approves €169 million Spanish scheme to support milk producers in context of Russia's invasion of Ukraine". 28/04/2022. Available at:
https://ec.europa.eu/commission/presscorner/detail/en/ip_22_2670

Inception date: 28 Apr 2022 | Removal date: 31 Dec 2022

Production subsidy

On 28 April 2022, the European Commission approved a EUR 169 million (USD 177.4 million) production subsidy scheme from Spain to support milk producers in the context of higher input prices. Support under the scheme can be granted until 31 December 2022. 

The scheme will provide support in the form of financial grants to compensate for the higher prices of electricity, fuel and animal feed. The grants will be calculated based on the number of cows, sheep or goats the beneficiary possesses (support per animal ranges between EUR 100 to EUR 210 for cows, EUR 15 for sheeps, and EUR 10 for goats). The implementing authority is the Ministry of Agriculture, Fisheries and Food.

In this context, the Commission's Decision notes: "The measure is liable to distort competition, since it strengthens the competitive position of its beneficiaries. It also affects trade between Member States, since those beneficiaries are active in sectors in which intra-Union trade exists". 

Regardless, the Commission approved the state aid without raising objections, concluding that "the measure is compatible with the internal market pursuant to Article 107(3)(b) of the TFEU".

The scheme is approved under the Temporary Crisis Framework set up to provide financial support in the context of the Russian invasion of Ukraine adopted in March 2022 (see related state act). Notably, also in March 2022, the Spanish government adopted Royal Decree-Law 6/2022 enacting the national response plan to the economic challenges caused by this crisis (see related state act).

 

AFFECTED SECTORS