We wrote in a recent blog that the UK Government would be publishing its "streamlined routes" for subsidy control under the new Subsidy Control Act 2022. Draft versions of these routes have now been published.
Streamlined routes are a type of subsidy scheme made by the UK government for use by any UK public authority. By creating pre-approved subsidies that do not need to be assessed against the subsidy control principles, and that can be made without reference to the CMA (including those that would otherwise be subject to mandatory referral) the streamlined routes function in a very similar way to the General Block Exemption Regulation regime under the old State aid rules.
Streamlined routes are voluntary tools that are designed to capture the lowest risk categories of subsidy, which is why they remove the need to carry out a case-by-case assessment against the subsidy control principles. The use of streamlined routes is intended to allow public authorities to award subsidies more quickly and easily. The flip side to that is that they are very narrow, perhaps more than GBER in some cases, and so will often not be the most suitable route to take.
The streamlined routes published so far are for use in the following three areas:
- Research, development and innovation
- Energy usage
- Local growth through initiatives such as "levelling up" programmes
These streamlined routes are currently still in draft form, and final versions will be published in January 2023.
As with subsidy schemes made by individual public bodies for their own use, the streamlined routes can only be used for subsidies that meet certain conditions, including with regard to points like eligible costs and funding intensity.
A subsidy made under a streamlined route is protected from challenge, but a subsidy that purports to be under a streamlined route but which does not meet the conditions will be more vulnerable to challenge than a subsidy that has been through an assessment against the principles.
The Scottish Government and other devolved administrations have statutory powers to design their own streamlined routes for public bodies within their own jurisdictions, to meet local conditions. So far none have been published in draft form.
If you would like to discuss how the introduction of the streamlined route or the new Subsidy Control Act 2022 generally will affect your organisation, please contact Jamie Dunne, Charles Livingstone, or your usual Brodies contact. You can also watch our recent webinar on the Act here.
