EUROPEAN COMMISSION
PRESS RELEASE
Brussels, 15 October 2014
State aid: Commission approves creation of British
Business Bank
The European Commission has concluded that UK plans for setting up the British Business
Bank (BBB), an integrated entity for managing SME access to finance programmes in the
UK, are in line with EU state aid rules. In particular, the Commission considered that the
BBB concept addresses market failures that hamper SME access to finance in an
appropriate and proportionate way, without unduly distorting competition in the Single
Market.
The BBB will have three subsidiaries, the Mandated Arm, Service Arm and Commercial
Arm, that will provide distinct services. It is also planned that certain already existing
programmes supporting SMEs will be integrated within the respective arms of the BBB.
The BBB will also develop and manage new SME access to finance programmes. The UK
considers that this will ensure a more effective deployment of programmes to support
SMEs in their growth and thereby contribute to economic development and job creation.
The Commission has approved that the Mandated Arm of BBB may receive up to GBP 6
billion (around € 7.6 billion) funding from the UK on a non-commercial (subsidised) basis
until the end of 2019. The Mandated Arm can use these funds, within an approved remit,
to provide SMEs with access to finance where a market failure is demonstrated, either on
commercial terms (through so-called "market conform schemes") or on subsidised, nonmarket terms. Market conform schemes are schemes, which grant funding on conditions
that a private market operator could have accepted. The Mandated Arm can grant funding
through such market conform schemes within the approved remit without having to seek
approval by the Commission, because such financing does not involve any state aid within
the meaning of EU rules. The introduction of new market conform schemes is subject to a
number of safeguards put in place to ensure, for example, that such financing does not
crowd out private finance providers, thereby avoiding competition distortions. The
Mandated Arm can also operate subsidised schemes involving state aid measures
approved by the Commission or deemed compatible under EU state aid rules (e.g. under
the Commission's General Block Exemption Regulation (GBER – see IP/14/587) or the de
minimis Regulation) or represent participation in EU financial instruments, such as COSME
or Horizon 2020. If the Mandated Arm wishes to implement interventions outside the
approved remit, it will have to notify the modification of its remit to the Commission.
The Commission also concluded that neither the activities of the Service Arm (which will
only provide advice and services to the UK Government) nor those of the Commercial
Arm (which will be funded on a commercial basis and will only carry out market conform
interventions) involve any state aid, and are therefore not caught by EU state aid control.
The non-confidential version of the present decision will be made available under case
number SA.36061 in the State Aid Register on the competition website once any
confidentiality issues have been resolved. New publications of state aid decisions on the
internet and in the Official Journal are listed in the State Aid Weekly e-News.
IP/14/1160
Contacts :
Antoine Colombani (+32 2 297 45 13, Twitter: @ECspokesAntoine )
Yizhou Ren (+32 2 299 48 89)
For the public: Europe Direct by phone 00 800 6 7 8 9 10 11 or by e-mail
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