The SCR JESSICA Regional Aid Scheme

General Conditions

1. Title
The SCR JESSICA Regional Aid scheme (the “Scheme”)

2. Member State
United Kingdom

3. Regions
East Midlands
Yorkshire and the Humber

4. Organisations permitted to award aid under the Scheme
South Yorkshire Property Investment Company Ltd
SCRUDF Limited Partnership

5. Legal Basis
Aid under the Scheme may be awarded in accordance with the relevant terms and conditions of the General Block Exemption Regulation 2014-2020 (“GBER”). Each award must comply with the General Conditions of the Scheme and the relevant Specific Condition(s).

6. UK legal authority to award aid
The South Yorkshire Property Investment Company and SCRUDF Limitd Partnership is authorised to award aid under domestic law, including:

• Limited Partnerships Act 1907
• Companies Act 2006

7. Duration

From 1.12.2017 to 31.12.2020

8. Forms of aid

Awards under the Scheme may take the form of:
• Grants;
• Loans below the reference rate; and
• Repayable advances.

9. Incentive Effect

All awards under the Scheme must demonstrate the ‘incentive effect’ in accordance with the requirements of the GBER.

This may involve the submission of documents to the funder prior to the award of funding.

10. Reporting

All awards are conditional upon the recipient providing suitable information to meet GBER reporting requirements set out in the GBER.

11. Cumulation

Aid awarded under the Scheme may only be cumulated with other awards of State Aid where these relate to different eligible costs.

12. Budget

In any calendar year the Scheme shall not be used to provide awards which cumulatively exceed €20 million. This sum is provided for State Aid purposes only and does not reflect a committed government budget.

13. Funding

The awards of aid provided under the Scheme may come from EU structured funds and state funds.
All awards of funding must identify the relevant regulation used to award funding; these are listed under specific conditions.

14. Primacy

In the event that any part of this scheme is inconsistent with the GBER, the provisions of GBER shall prevail.

15. Contact

Questions about this scheme should be directed to the SCR JESSICA, c/o Ben Morley, City Growth - Sheffield City Council, 11 Broad St West, Sheffield S1 2BQ

Specific Conditions

1. Name
Regional Investment Aid

2. Eligible costs
Eligible costs shall be the following:-
(a) Investment costs in tangible and intangible assets;
(b) The estimated wage costs arising from job creation as a result of an initial investment, calculated over a period of two years; or
(c) A combination of the above not exceeding the amount of either, whichever is higher.

3. Aid intensity

REGIONAL AID: GBER SECTION 1

Aid Measure: GBER Article 14: Regional Investment Aid and GBER Article 4

Maximum % aid intensity levels for Large, Medium and Small Enterprises
Regional Aid:
The aid intensity in gross grant equivalent shall not exceed the maximum aid intensity established in the regional aid map which is in force at the time the aid is granted in the area concerned. Where the aid intensity is calculated on the basis of the eligible costs, the maximum aid intensity shall not exceed the most favourable amount resulting form the application of that intensity on the basis of investment costs or wage costs. For large investment projects the aid shall not exceed the adjusted aid calculated in accordance with the mechanism defined in GBER Article 2, point 20.
The two intervention rates that operate in England are Tier 1 and Tier 2.

Notification Thresholds:
The ‘adjusted aid amount’, calculated in accordance with the mechanism identified in GBER Article 2, point 2 for an investment with eligible costs of €100 million.

4. Excluded undertakings
See GBER Articles 1 and 13(a) – (e).

5. Other conditions

GBER Article 14, point 2
The aid shall be granted in assisted areas.

GBER Article 14, point 3
In assisted areas fulfilling the conditions of Article 107(3)(a) of the Treaty, the aid may be granted for an initial investment regardless of the size of the beneficiary. In assisted areas fulfilling the conditions of Article 107(3)(c) of the Treaty, the aid may be granted to SMEs for any form of initial investment. Aid to large enterprises shall only be granted for an initial investment in favour of new economic activity in the area concerned.

GBER Article 14, point 5
The investment shall be maintained in the recipient area for at least five years, or at least three years in the case of SMEs, after completion of the investment. This shall not prevent the replacement of plant or equipment that has become outdated or broken within this period, provided that the economic activity is retained in the area concerned for the relevant minimum period.

GBER Article 14, point 6
The assets acquired shall be new except for SMEs and for the acquisition of an establishment. Costs related to the lease of tangible assets may be taken into account under the following conditions:
(a) for land and buildings, the lease must continue for at least five years after the expected date of completion of the investment project for large undertakings or three years in the case of SMEs;
(b) for plant or machinery, the lease must take the form of financial leasing and must contain an obligation for the beneficiary of the aid to purchase the asset upon expiry of the term of the lease.
In the case of acquisition of the assets of an establishment within the meaning of GBER Article 2 point 49, only the costs of buying the assets from third parties unrelated to the buyer shall be taken into consideration. The transaction shall take lace under market conditions. If aid has already been granted for the acquisition of assets prior to their purchase, the costs of those assets shall be deducted from the eligible costs related to the acquisition of an establishment. Where a member of the family of the original owner, or an employee, takes over a small enterprise, the condition that the assets be bought from third parties unrelated to the buyer shall be waived. The acquisition of shares does not constitute initial investment.

GBER Article 14, point 7
For aid granted for a fundamental change in the production process, the eligible costs must exceed the depreciation of the assets linked to the activity to be modernised in the course of the preceding three fiscal years. For aid granted for a diversification of an existing establishment, the eligible costs must exceed by at least 200 % the book value of the assets that are reused, as registered in the fiscal year preceding the start of works.

GBER Article 14, point 8
Intangible assets are eligible for the calculation of investment costs if they fulfil the following conditions:
(a) they must be used exclusively in the establishment receiving the aid;
(b) they must be amortisable;
(c) they must be purchased under market conditions from third parties unrelated to the buyer; and
(d) they must be included in the assets of the undertaking receiving the aid and must remain associated with the project for which the aid is granted for at least five years or three years in the case of SMEs.
For large undertakings, costs of intangible assets are eligible only up to a limit of 50 % of the total eligible investment costs for the initial investment.

GBER Article 14, point 9
Where eligible costs are calculated by reference to the estimated wage costs as referred to in the eligible costs, the following conditions shall be fulfilled:
(a) the investment project shall lead to a net increase in the number of employees in the establishment concerned, compared with the average over the previous 12 months, meaning that any job lost shall be deducted from the apparent created number of jobs during that period;
(b) each post shall be filled within three years of completion of works; and
(c) each job created through the investment shall be maintained in the area concerned for a period of at least five years from the date the post was first filled, or three years in the case of SMEs.

GBER Article 14, point 10
Regional aid for broadband network development shall fulfil the following conditions:
(a) aid shall be granted only in areas where there is no network of the same category (either basic broadband or NGA) and where no such network is likely to be developed on commercial terms within three years from the decision to grant the aid; and
(b) the subsidised network operator must offer active and passive wholesale access under fair and non-discriminatory conditions including physical unbundling in the case of NGA networks; and
(c) aid shall be allocated on the basis of a competitive selection process.

GBER Article 14, point 11
Regional aid for research infrastructures shall be granted only if the aid is made conditional on giving transparent and non-discriminatory access to the aided infrastructure.

GBER Article 14, point 13
Any initial investment started by the same beneficiary (at group level) within a period of three years from the date of start of works on another aided investment in the same level 3 region of the Nomenclature of Territorial Units for Statistics shall be considered to be part of a single investment project. Where such single investment project is a large investment project, the total aid amount for the single investment project shall not exceed the adjusted aid amount for large investment projects.

GBER Article 14, point 14
The aid beneficiary must provide a financial contribution of at least 25 % of the eligible costs, either through its own resources or by external financing, in a form, which is free of any public support. In the outermost regions an investment made by an SME may receive an aid with a maximum aid intensity above 75 %, in such situations the remainder shall be provided by way of a financial contribution from the aid beneficiary.

GBER Article 14, point 15
For an initial investment linked to European territorial cooperation projects covered by Regulation (EU) No 1299/2013, the aid intensity of the area in which the initial investment is located shall apply to all beneficiaries participating in the project. If the initial investment is located in two or more assisted areas, the maximum aid intensity shall be the one applicable in the assisted area where the highest amount of eligible costs is incurred. In assisted areas eligible for aid under Article 107(3)(c) of the Treaty, this provision shall apply to large undertakings only if the initial investment concerns a new economic activity.