The Competition and Markets Authority (CMA) is consulting on guidance that sets out the role of the Subsidy Advice Unit (SAU). The SAU is a new CMA function created by the Subsidy Control Act, which provides a new regime for governing the provision of subsidies within the UK following its exit from the EU.
Subsidies are offered to achieve specific public objectives (for example, car manufacturers could be offered a subsidy to help lower the price of electric vehicles to support the achievement of environmental targets). The SAU will provide advice to public authorities at all levels, evaluating their assessments of the financial assistance they provide, via subsidies, to organizations.
The SAU will provide independent, non-binding advice on the assessments of certain high-value subsidies that are referred to by public authorities, taking into account any effects that they might have on competition or investment in the UK. The SAU will publish these reports. Decisions on whether or not to offer subsidies are for public authorities, not the SAU or CMA.
In addition, the SAU will periodically monitor and review the operation of the UK subsidy control regime.
The CMA is seeking views on its draft guidance, particularly how the SAU will:
- Exercise its functions, including its information gathering powers, and the procedures it will adopt, including the way it will engage with public authorities.
- Evaluate and report on the public authority’s assessment of the subsidy or scheme’s compliance with the subsidy control requirements.
- Decide which subsidies and schemes to review when it has discretion to do so.
Rachel Merelie, Senior Director at the CMA, said:
The CMA has been asked to play a specific and important role in the new UK subsidy control regime. We will use our expertise to ensure public authorities have expert and independent advice to help inform their policy decisions.
We’re keen to hear a range of voices on our draft guidance to help make sure the UK benefits from a world-leading subsidy control regime.
The draft guidance explains the SAU’s proposed approach to transparency, consultation, confidentiality, and publication of its reports. It also provides information about its online Public Authority Portal, which public authorities will use to submit referrals to the SAU once the new regime comes into effect.
The CMA is also consulting on a draft Statement of Policy in relation to the enforcement by the SAU of its information-gathering powers for the performance of its monitoring functions.
The CMA welcomes all views on its draft guidance and Statement of Policy by 10 August 2022 and plans to publish its final guidance later this year.
The launch of the SAU’s consultation follows the publication of the BEIS consultation on the statutory guidance for the Subsidy Control Act 2022.