Post-Brexit rules for business subsidies come into effect

Following the UK’s exit from the European Union (EU), new rules governing how local authorities and national government can provide subsidies to business in need have come into effect.

The new regime will give local authorities greater freedom to support key local industries or businesses in need and make the subsidies system more responsive and quicker to react to market conditions. Previously, under EU rules, all business subsidies were required to undergo a time-consuming approval process, subject to European rules and the European Commission, which regularly saw local authority schemes knocked back.

Business Minister Kevin Hollinrake said:

“New rules mean UK authorities will be free to deliver money to businesses in a quicker, fairer, and simpler way, without longwinded and unnecessary approval processes to bog us down.”

The introduction of these new rules is the most significant change in subsidy administration in over 40 years and marks a landmark transition away from EU processes.

The new regime has been developed in accordance with views gathered from stakeholders across the country in an extensive consultation.

The new rules will also give public authorities the ability to award subsidies to business through streamlined routes, schemes that are pre-assessed by the government, and provide public authorities with an even easier and quicker way to support their local economy. The government is currently developing 3 of these schemes, which will cover research, development and innovation, energy usage, and local growth.