When the Brexit implementation period ended on 31 December 2020, EU state aid rules ceased to apply in the United Kingdom (other than in relation to Northern Ireland). On 11 May 2021, at the State Opening of Parliament, it was announced that a Subsidy Control Bill (Subsidy Control Bill) would be introduced during the 2021-2022 parliamentary session.
Until the Subsidy Control Bill becomes law, the "level playing field" provisions of the UK-EU Trade and Co-operation Agreement (TCA) have effect, as a matter of UK domestic law, by a single provision of the European Union (Future Relationship) Act 2020. Currently, that provision represents the sum total of UK law relating to subsidies (other than in respect of Northern Ireland).
Early in 2020 the UK government began consulting (Consultation) on its plans for the new, bespoke, UK subsidy regime that will be established when the Subsidy Control Bill becomes law. A cross-disciplinary team from Gide's London and Brussels offices submitted, on 31 March 2021, a formal response to the Consultation. Gide intends to continue to actively engage with the UK government's outreach as the new subsidy regime evolves.
This note is intended to highlight some fundamental ways in which the new UK subsidy control regime is likely to differ from the EU state aid regime and to suggest what this is likely to mean in practice.
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