The European Commission has approved under EU State aid rules Malta’s map for granting regional aid from 1 January 2022 to 31 December 2027, within the framework of the revised Regional aid Guidelines (‘RAG’).
The revised RAG, adopted by the Commission on 19 April 2021 and in force since 1 January 2022, enable Member States to support the least favoured European regions in catching up and to reduce disparities in terms of economic well-being, income and unemployment – cohesion objectives that are at the heart of the Union. They also provide increased possibilities for Member States to support regions facing transition or structural challenges such as depopulation, to contribute fully to the green and digital transitions.
At the same time, the revised RAG maintain strong safeguards to prevent Member States from using public money to trigger the relocation of jobs from one EU Member State to another, which is essential for fair competition in the Single Market.
Malta’s regional aid map defines the Maltese regions eligible for regional investment aid. The map also establishes the maximum aid intensities in the eligible regions. The aid intensity is the maximum amount of State aid that can be granted per beneficiary, expressed as a percentage of eligible investment costs.
Under the revised RAG, regions covering up to 70% of the population of Malta will be eligible for regional investment aid, under the derogation of Article 107(3)(c) of the Treaty on the Functioning of the European Union (‘TFEU’) (so-called ‘c’ areas).
In order to address regional disparities, Malta has designated as so-called non-predefined ‘c’ areas, the entire Gozo and Comino islands and a part of the main island of Malta, covering 69.96% of Malta’s population. In those areas, the maximum aid intensities for large enterprises will vary between 10% and 15%, depending on the GDP per capita of the area.
In all the above areas, the maximum aid intensities can be increased by 10 percentage points for investments made by medium-sized enterprises and by 20 percentage points for investments made by small enterprises, for their initial investments with eligible costs up to €50 million.