Press Release: State aids: tax incentives for Italian companies participating in trade fairs abroad are illegal

The European Commission decided on 16 December 2004 that special tax incentives for companies taking part in trade fairs abroad (available under the 2004 Italian budget law) were illegal under EU state aid rules. The decision followed an in-depth investigation opened in March 2004. The Commission said that the scheme distorted competition because it was limited to exporting undertakings and had the effect of improving the trading conditions of Italian companies in foreign markets, including in other Member States. The aid had been enacted without prior Commission approval and had to be reimbursed by its beneficiaries. However, the specific part of the aid paid over to SMEs participating for the first time in a fair was compatible with EU rules and so would not have to be repaid, so the Commission.