CMA to take on State aid role post-Brexit

United KingdomScotland

In February, we reported (see here) on the House of Lords’ EU Internal Market Sub-Committee report (the “Report”) on the opportunities and challenges the UK faces post-Brexit in respect to competition and State aid matters.

While the Government is still to respond in full to the Report’s recommendations, on 28 March 2018 it published a letter from the BEIS junior minister Andrew Griffiths to Lord Whitty (Chair of the Lords’ EU committee) confirming a number of key points. In that letter, it was confirmed that the Competition and Markets Authority will be best placed to take up the role of State aid regulator in the UK post-Brexit.

The Government has also confirmed that for the duration of the transition period the UK will continue to apply the EU State aid rules and that the European Commission will continue to be responsible for approving and monitoring aid.

In the longer term, more detailed decisions on the UK State aid regime are subject to further discussion with the EU as part of the negotiations on the future EU-UK relationship. The Government's view is that the UK should be prepared to establish a full, UK-wide subsidy control framework, with a single UK body for enforcement and supervision (namely, the CMA), at the point this is required. In line with this objective, the EU State aid rules will be transposed under the European Union (Withdrawal) Bill. This transposition will apply to all sectors, including agriculture, fisheries and transport and will replicate any existing exemptions from State aid rules.

The CMA has already started preparing for its new responsibilities in State aid regulation, announcing the appointment of Sheldon Mills and Juliette Enser as Senior Director of State Aid and Project Director of State aid respectively.