Capital Projects

Although the Structural Funds, particularly the European Regional Development Fund, represent the single largest form of incentive for capital projects, they are seldom made available directly to the private sector.

Most European state aids have the objective of promoting regional development so that each Memeber State is required to restrict financial support according to agreed Assisted Areas maps.
Eurofi holds a complete collection of such maps

Exceptionnaly, capital incentives can be negotiated in Non-Assisted Areas. These include schemes having an environmental objective or the aim of improving the processing of agricultural and fisheries produce.

Grants are not the only form of incentive for captal projects. The European Investment bank provides advantageous loans to both the public and the private sector to fund large projects. Smaller firms are often able to benefit from soft loans, or loans guarantees, provided via financial intermediaries

Some industries experiencing over-capacity, notably coal mining, steel and synthetic fibre production, are largely ineligible for state aid. There are few state aids available to support projects, such as retail activity, serving a purely local need.

The prime regional development incentive in the UK is the Regional Selective Assistance (RSA)

Regional Selective Assistance

RSA is the main form of assistance available to businesses in certain parts (the Assisted Areas:

Tier 1 - permits the highest level of RSA funding, the eligible areas being South Yorshire, Corwall, Merseyside and West Wales & the Valleys

Tier - the "standard" RSA qualifying areas

Tier 3 - a broader coverage, restricted to businesses employing up to 250 people

LIMITS

The minimum project size for RSA applications is £500,000

The aid ceiling for Tier 1 is 35% of eligible expenditure. Tier 2 is sub-divided into three Sub-Tiers with limits of 20%, 15% and 10%

GENERAL ADVICE

RSA is a highly discretionary scheme with the onus being on the applicant to demonstrate that, without grant, the project would not proceed as envisaged. there is therefore no guarantee that the aid intensity limits, as indicated for a specific location, can be achieved. To have any chance of negotiating a high level of award, it is vital for a well-developed and coherent application to be put together and negotiated.

Funding for capital projects in the other Member States is similar to that in the UK and is subject to the same state aid limitations to meet European Competition Guidelines.
Eurofi's experience in this field is second-to-none

For a preliminary discussion on grant eligibility call : Tony Reid on 0131 225 8451

You can also contact him by email enquiries@eurofi.co.uk

Research, Development and Demonstration / Training / Environmental Improvement