In today's article, we will understand the concept of de minimis grants and how they are regulated in the European Union.

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The word Minimis comes from Latin and means “about the little things”. In the legal sense, minimis refers to something that is not of significant importance for the law to pay attention to.

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So, De minimis grants are those provided by the Member States of the European Union to companies with an amount that is not enough to bring them to the attention of the European Commission.

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The conditions of de minimis aid are found in the Regulation (EU) 1407/2013, of December 18, 2013, of the Commission, concerning the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union and establish that total de minimis aid granted by a company:

• It cannot exceed €200,000 over a period of 3 fiscal years, that is, the current fiscal year and the previous two.
• It cannot exceed 100,000€ in the case of companies that are dedicated to road transport.

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Why is this concept important and in what situations does it apply?

The concept of minimis is important because it is usually common to find in the regulatory bases of an aid line a phrase that reads as follows: “These grants are subject to the de minimis aid regime, in the terms established in Regulation (EU) No. 1407/2013 of the Commission of December 18, 2013, concerning the application of articles 107 and 108 of the Treaty on the Functioning of the European Union to de minimis aid.”

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This means that if our company has received other aid subject to minimis in the last 3 years, exceeding the sum of them €200,000, we will no longer be able to apply for other aid subject to this regime.

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ICO credits and other loans with public guarantees or in advantageous situations may contain minimis. This has generated some confusion among entrepreneurs because it is not clear if to calculate the de minimis amount they have granted they must add up the amount of the loan or interest... Well, neither one nor the other. In this case, only the portion of the interest that is subsidized must be taken into account. For example, if the startup has obtained a loan of €400,000, and it has interest under normal conditions of €20,000, of which it only has to pay €5,000, since the other €15,000 are subsidized, the amount of aid that would count as a minimum would be €15,000.

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Is all aid subject to the de minimis regime?

The requirement to report grants is made in order to determine their compatibility with the common market. However, certain aids can be exempted from notification on the grounds that they are compatible with the common market. In this sense, state aid that has the following characteristics is compatible and does not need to be communicated to the European Commission:

• Aid for the development of disadvantaged regions.
• Grants for SMEs - Research and Development (R&D)
• Protecting and improving the environment
• Encouraging employment and training

What date is taken to calculate the minimis

In Article 3.4 of the Regulations we find defined:

“De minimis aid shall be considered granted when the company is granted the legal right to receive the aid under the applicable national legal regime, regardless of the date of payment of the de minimis aid to the company.”

Therefore, the date to be taken into consideration will not be the date that the money was actually received, but the date on which it was granted.

Who cannot benefit from this type of aid?

There are some categories of companies that cannot receive de minimis aid:

• Agriculture, when they are going to be used for the primary production of agricultural products.
• Companies that export to Member States or third countries.
• Grants for the purchase of vehicles for the transport of goods by road.
• Aid conditioned on the use of domestic and non-imported products.
• Loans and grants for companies in difficulty.

What types of de minimis aid are there?

De minimis aid can be granted in 3 types of modalities:

• Grants
• Loans
• Deductions on interest on bank loans

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Since when have the Regulations been in force?

It is effective as of January 1, 2014 and is applicable until December 2023.

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How can you know if the aid is subject to a de minimis regime?

Public aid publication orders explicitly state whether aid is subject to a minimis or not. It is more common that grants are not subject to minimis than that they are.

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To view all the features, you can consult the Regulations and their corresponding articles in the Next link.