GETTING STATE AID RIGHT IN REGIONAL GROWTH FUND BIDS

The Regional Growth Fund is offering £1.4 billion to support private sector led initiatives in England. The fund shall operate as an open competition where applicants bid in and are judged against five key criteria. These are location, additionality,  sustainable jobs, vfm and State Aid. Of these, the ability to comply with State Aid law is causing the most difficulty for interested parties. 


In this article we draw upon our own experience of instructing many State Aid experts and provide our top tips to find your perfect State Aid adviser.

1)   Choose what kind of adviser you want at the outset

Before making contact with potential advisers, decide exactly what service your organisation will require from your State Aid adviser. 

Key considerations are cost, location and how involved you expect your adviser to be with the process of making an application. If you work within a particular sector it may be preferable to select an adviser who has demonstrable experience of working in a particular area. 


Once you have identified these requirements, we recommend that you write down all the criteria that you feel your perfect State Aid adviser will deliver. 

Engage articulate and commercially minded State Aid advisers

2)   Ask potential advisers to pitch

Any good State Aid adviser will be willing to provide a half page explanation of their expertise in relation to your particular piece of work. 

Use the web, legal search engines and referrals to narrow down your search to three or four advisers and then ask each to set out why they should be instructed. Some people are reluctant to make such a request - there is no reason for this; your organisation is purchasing an expensive service and this process will help you find the right adviser.

Assess the email against your criteria for the perfect State Aid adviser. Look for examples of the adviser having been involved in similar work to that required for your Regional Growth Fund bid. Whilst sector specific work is useful make sure it is directly relevant to the piece of work you are asking the adviser to undertake. 

Check the responses for evidence of a clear understanding of State Aid. A good adviser should be capable of explaining complex issues in a clear manner. Look out for evidence of out of date understanding. Those with out of date knowledge often still refer to Article 87 (which was replaced in December 2009 by Article 107). Those with a weak understanding of the rules are also inclined to be over optimistic when considering whether the measure will affect trade between Member States. 


Finally, feel free to ask the adviser to set out a cost schedule for the work at the pitching stage. It is your right to understand how much you will pay for this specialist advice.

Getting the right team together at the start is an integral part of winning in this competition. 

3)   Size doesn't matter

When you engage a State Aid expert you are taking on an individual with a specific set of skills - it is therefore important to focus upon the person who will be providing the advice. 

Many organisations make the mistake of selecting a State Aid adviser based upon the general reputation or the size of the law firm. Such considerations can be important when selecting general advice (where your work is likely to be carried out by different members of a team) but have no place with State Aid law.  

A similar mistake is to bundle the State Aid advice in with the general work required for the project. This can happen where State Aid advice is included with general legal advice or as part of the selection criteria for a project manager. This is a common error. Although it can be tempting to adopt such an approach to save costs, it is a false economy if the advice is sub-standard. 

4)   Ask advisers in the public sector for a steer on who to select.

The public sector has been handling State Aid in projects for years and will have experience of instructing independent experts for advice upon State Aid. 

Many legal departments in public sector organisations will be happy to provide a few names who have provided good work in the past. 

5)   Only select an adviser who trusts their own advice

A good adviser trusts their own advice. Any adviser who seeks to caveat their advice does not trust their judgement on State Aid law. 

Before you select an adviser ask to see their engagement letter. Likewise do not accept any advice document which shifts all the responsibility for decision making on to you. Given that you are paying for their judgement on State Aid law, you are entitled to challenge any caveat which seeks to prevent you relying on their advice. A skillful State Aid adviser will give you clear advice which you can rely upon. 

For more updates on State Aid law, you can follow @StateAidLaw on Twitter.