Thread by @GeorgePeretzQC

This is the promised blog post on the subsidy control provisions of the Trade and Cooperation Agreement.

https://twitter.com/eurelationslaw/status/1343466485826662400

TLDR (though do read). The subsidy control provisions commit the UK to a robust subsidy control regime that is enforceable in court and has an independent authority.

The key concepts of the regime (eg what counts as a subsidy, application to tax measures, principles for clearing or prohibiting subsidies) are very familiar to State aid lawyers, though the State aid terminology is deliberately avoided.

Though the UK has a free hand in deciding what role the independent authority will play, in practice it will be asked to rule on any major subsidy before it goes ahead in order to remove commercial uncertainty.

In practice, therefore, the UK may well end up with a regime that works in a similar way to the EU’s: block exemptions governing most subsidies and authority rulings on non-standard cases, with the courts handing non-notified cases and appeals from authority decisions.

The immediate issue is that there is no domestic law in place on 1 January (when it is required to be in place). The current position is that EU State aid law will cease to have effect in the UK on that day, with no replacement.

There won’t be time to devise - let alone consult on or scrutinise - a replacement in 3 working days. So I think the government will have to keep the EU State aid rules - or, rather, a simulacrum of them - going until a new regime can sensibly be worked out.

Fortunately, that work has already been done and a statutory instrument drafted - though by the May government.

Whatever happens, though, the government will need to explain what it is going to do rather fast. Anyone with projects in January requiring public funding is really going to want to know.