Notice

Annex 2: WTO Subsidy Control

Published 31 October 2022

This notice was withdrawn on 23 February 2023

This call has now closed.

1. Subsidy Control (and State aid where relevant)

The UK Space Agency supports UK based businesses to invest in research, development and innovation. The support we provide is consistent with the UK’s international obligations and commitments to Subsidy Control. These include:

• WTO rules
• the EU-UK Trade and Cooperation Agreement (TCA), (see EU-UK TCA summary and BEIS (Dept. for Business, Energy & Industrial Strategy) guidance)
• in certain very limited circumstances (e.g. under the Northern Ireland Protocol) EU State aid regulations may also be applied

For the purposes of UK international commitments, a subsidy is a measure which:

• Is given by a public authority. This can be at any level; central, devolved, regional or local government or a public body.

• Makes a contribution (this could be a financial or an in-kind contribution) to an enterprise, conferring an economic advantage that is not available on market terms. Examples of a contribution are grants, loans at below market rate, or a loan guarantee at below market rate or allowing a company to use publicly owned office space rent free. An enterprise is anyone who puts goods or services on a market. An enterprise could be a government department or a charity if they are acting commercially.

• Affects international trade. This can be trade with any World Trade Organisation member or, more specifically, between the UK and a country with whom it has a Free Trade Agreement. For example, if the subsidy is going towards a good which is traded between the UK and the EU this could affect trade between the EU and the UK. It is not necessary to consider whether the subsidy could harm trade, just whether there could be some sort of effect. Subsidies to very local companies or a small tourist attraction are unlikely to affect international trade.

The UK Subsidy Control regime (or where relevant EU State aid regulations) are designed to prevent unfair advantages and distortion of trade: Complying with the UK’s international obligations on subsidy control

More information on the principles of awarding subsidies can be found in the BEIS guidance.

Subsidy Control Categories and Intervention Thresholds

Unless otherwise stated, the following table summarises the maximum intervention thresholds allowable level of support under UK Space Agency grant calls for Financial Year 2022/2023.

Subsidy category	Level of support available
	Micro/Small Enterprise	Medium Enterprise	Large Enterprise
Fundamental research	100%	100%	100%
Feasibility study	70%	60%	50%
Industrial research	70%	60%	50%
Industrial research projects involving collaboration/ dissemination*	80%	75%	65%
Experimental development	45%	35%	25%
Experimental development projects involving collaboration/dissemination*	60%	50%	40%

*Collaborations between businesses and research organisations where the research organisation bears at least 10% of the costs and have the right to publish their own research. Procurement/supplier relationships do not qualify.

The following table summarises the UK definition of what constitutes an SME:

Company category	Staff headcount	Turnover	or	Balance sheet total
Medium sized	< 250	≤ £36m	≤ £18m
Small	< 50	≤ £10.2m	≤ £5.1m
Micro	< 10	≤ £632,000	≤ £316,000

To qualify for any category, the company must meet at least two of the above conditions (staff headcount, Turnover or Balance sheet total) within both the current financial year and the year previous.

Anything above the limits for a medium sized company is designated as a large company. For more information on company sizes, please refer to the company accounts guidance. This is a change from the EU definition unless you are applying under State aid.

Other sources of public funding are not eligible as a Private Venture (PV) / match funding contribution.

Academic partners will be funded in all cases at 80% of Full Economic Cost (FEC).

Special Drawing Rights (SDRs) and EU de minimis awards.

The UK-EU Trade & Cooperation Agreement (TCA) has provision relating to Small Amounts of Financial Assistance (SAFA).

For organisations applying for SAFA, the total subsidy which can be given to each organisation is up to a maximum of 325,000 which at current exchange rates converts to £340,000, over a rolling 3 fiscal year period. This threshold is subject to change due to exchange rates and grant recipients should consult the subsidy control guidance for regular updates.

When calculating eligibility for the application of the SAFA provision bidders must include cumulation of EU State aid de minimis grants under the EC’s de minimis regulation for the same 3 fiscal year period. The maximum total under the EC regulation is €200,000. You must complete and provide UK Space Agency with a declaration as part of your response.

The declaration asks you to tell us about any awards, including those made under de minimis and SDR, (from any source of public funding) over a rolling 3 fiscal year period.

If you have received an award under de minimis for the same period, this will be added to your total allowance under SDR. This means that the total award must not exceed approximately £340,000 (325,000 SDR) for any one organisation. You must declare this allowance to any other funding body who requests it.

2. Disclaimer

This guidance is not a substitute for taking independent legal advice on your eligibility status, before applying for funding. Every applicant is responsible for securing their own independent legal advice to ensure they are lawfully eligible.

Please note the UK Space Agency is unable to award organisations that are considered to be ailing and insolvent companies. We will conduct financial viability and eligibility tests to confirm this is not the case following the application stage.

If you see an error in this guidance:

Email: Commercial@ukspaceagency.gov.uk