Important projects of common European interest: Boosting EU strategic value chains

Summary:

Article 107(3)(b) of the Treaty on the Functioning of the European Union provides for the possibility of approving state aid for 'important projects of common European interest' (IPCEIs). These provisions have been used very rarely until recently. A specific framework enabling the creation of IPCEIs, originally only in the areas of research, development and innovation, and environmental protection has been in place for 15 years, yet only four such projects have been notified to and assessed by the Commission so far. The first two – in the area of infrastructure – were partially annulled by the Court of Justice, and the Commission opened in-depth investigations to examine their compatibility with State aid. One of those concluded that the aid was legal, the other is ongoing.

The next two were launched successfully in the areas of strategic value chains for microelectronics and batteries. After this rather modest start, there seems to be strong momentum to create more IPCEIs, including in the context of the debate on how to foster the emergence of 'European champions'. The marked political shift towards greater technological sovereignty and strategic autonomy within the EU has been given further impetus with the outbreak of the coronavirus pandemic, which disrupted global value chains and highlighted the case for a more self-sufficient EU model. IPCEIs may be useful tools for creating complex new value chains that have the potential to ensure the EU's long-term competitiveness and economic growth.

A growing number of governments, experts and organisations have been calling for the simplification of current rules to make IPCEIs more frequently and widely used. The European Parliament would also like to see the requirements for the IPCEIs streamlined to allow smaller industrial research projects also to acquire IPCEI status. In its 2021 work programme, the European Commission announced the revision of the current IPCEI framework planned for the fourth quarter of the year.

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