Scheme or Subsidies of Particular Interest (SSoPI) are those subsidies granted over £5 million in sensitive sectors, or over £10 million outside sensitive sectors (individually or cumulatively). Sensitive sectors includes producing metals, electricity, vehicles, air craft, space craft, ships and floating structures.
SSoPIs are considered to carry a higher risk of distorting competition, and are therefore subject to mandatory referrals to the Subsidy Advice Unit under the Subsidy Control Act 2022 (the Act). Referrals help ensure that there is a higher level of scrutiny on subsidies which could distort national and international competition and investment. In making the referral, the Subsidy Advice Unit is tasked with reviewing a public authority’s assessment of the subsidy against the subsidy control principles set out in Schedule 1 of the Act, and, where applicable, the energy and environment principles in Schedule 2.
Following mandatory referrals, the Subsidy Control Unit publishes advisory reports setting out key findings and areas for improvement in the public authority’s assessment. The reports are non-binding, and do not confirm whether the SSoPI is lawful. Public bodies are not obliged to amend their subsidy control assessments in light of the reports.
Since the Act came into force on 4 January 2023, there have been nine reports published by the Subsidy Advice Unit, with another three to be published in the coming weeks. The Subsidy Advice Unit’s reports, whilst advisory in nature only, provide useful insights for public bodies preparing future subsidy control assessments.
More general points for improvement include following the statutory guidance more closely, and ensuring conclusions are clearly reasoned and supported by up to date evidence.
Whilst the reports are non-binding, it is important to remember that a thorough evidential based subsidy control assessment, may reduce the likelihood of a SSoPI being legally challenged.
If you would have any queries about subsidy control assessments, or would like further information on subsidy control please contact our Public Sector team. More details on subsidy control can also be found in our bitesize series.