Subsidies in the US and the EU: Control or Free Provision?

Iana Roginska-Green
EU Law Consultant, Washington D.C., US

Series: Trade Issues, Policies and Laws
BISAC: LAW009000



Volume 10

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Special issue: Resilience in breaking the cycle of children’s environmental health disparities
Edited by I Leslie Rubin, Robert J Geller, Abby Mutic, Benjamin A Gitterman, Nathan Mutic, Wayne Garfinkel, Claire D Coles, Kurt Martinuzzi, and Joav Merrick


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This book represents a historical, political and legal overview of the US and EU systems of provision for corporate subsidies and their control.

Differences, one might think, are easy to imagine, while similarities may not be as apparent. Over the last sixty years, the European project has developed a sophisticated legal regime for the monitoring and control of corporate subsidies (legal term used is “state aid”), whereas the United States has no systems that come close to any such organized effort.

However, the lack of any regulatory framework in the United States cannot be explained by the absence of subsidies and corporate support in the economy. State aids or corporate subsidies are provided at every level – federal, state, and local. There are many historic and recent cases of the provision of such subsidies in the US and how they influenced the economy of the country. However, what still remains similar with the EU system is the effect on competition these state interventions have and the consequences for the final consumers and taxpayers.

It is unclear whether the United States will ever move in the direction that Europe has taken from a regulatory point of view. What is indisputable, however, is that the European experience provides a rich record of the many forms that state aids might take, how they affect competition at various levels of the market, and what kinds of remedial measures seem appropriate. In that sense, Americans might learn from the Europeans and try to develop this area of the law. The European experience offers many useful lessons for the rest of the world.

The overview and assessment of this book will be a good instrument for the US audience – from policymakers to academia – to see how both systems work and if there is a need and possibility for the US to apply the same regulatory regime.

Chapter 1. Introduction

PART 1 - The EU State Aid Regulatory System

Chapter 2. The State Aid Control System in the European Union

Chapter 3. Practical Examples, Interesting Cases and State Aid Control in Non-EU Countries

PART 2 – Corporate Subsidies in the United States

Chapter 4. History of the Corporate Subsidies in the United States


Chapter 5. Comparative Analysis of the Us and Eu Corporate State Support Systems

Chapter 6. Assessment of the Possible Impact of EU State Aid Regulation on US Companies

Chapter 7. Is it Possible to Introduce a European Union Style System of State Aid Control and Monitoring in the United States?

Chapter 8. Conclusions


“Business subsidies are one of the least regulated fields of US public policy and, in contrast, one of the most strictly regulated fields of EU law. As all public subsidies to the business sector challenge or even undermine the integrity of free markets, the question arises: is there something missing in US law? or has the EU gone beyond what is needed to ensure free functioning markets? This publication puts the spotlight on this debate and raises important issues of economic policy management, free trade and the use of state and federal budgets in the US.” - Dr. Eugene Stuart, State Aid Law and Policy expert

"The book gives us a comprehensive overview of the EU State aid regulatory system, and describes the forms and methods of the government support to business in US. According to the EU law any aid granted by a Member State that meets certain criteria is incompatible with the internal market unless exemptions apply. The main idea is that fair competition may be ensured only provided undertakings operate in the market suing only own resources. Therefore, in the EU State aid is regulated by the European Commission. In the US there is no such regime. Constitution of the country is a primary source to control the States to provide aid to businesses. Which system is better? The book provides a useful framework for analysing both systems. It describes their pros and cons. It gives examples to prove the major idea: State support to companies is very harmful because it creates uneven playing field. In particular, it is important nowadays when the EU and US try to find transparent ways of taxing the new digital economy." - Sigitas Cemnolonskis, State Aid Law and Policy expert

“In this work, Iana Roginska has produced a thorough and meticulously documented primer on the problem of corporate welfare in the United States. Even readers familiar with the issue may find themselves amazed both by the amount of money involved and by the identities of some of the recipients (tens of millions of dollars to Bed, Bath and Beyond?). We all know we're being ripped off, but few people realize just how much!” - Darien Sumner, senior editor at Libertarian Gaming

"A thorough and illustrative guide on EU State aid control and US Corporate state support system, drawing on the comparison and highlighting very clearly the important differences. An excellent read that enables even non-experts to obtain quickly an acquaintance with the issues discussed and familiarize themselves with the principles and procedures of both systems on both sides of the Atlantic." - Dr. Mihalis Kekelekis, Senior Officer, Competition and State Aid Directorate, EFTA Surveillance Authority, Brussels

The book is aimed at a wide audience of those with an actual or potential interest in a single guidance publication on corporate state support law and policy in the US and EU – its history, overview, current situation, case examples and assessment. Thus, it is intended to be useful for US officials and for lawyers, officials and other practitioners and academia throughout the EU and the United States.
The primary market of the book: US practitioners and officials; academia; judiciary; legal consultancies.
The secondary market: officials, practitioners and academia from EU countries and Masters/LLM/PhD students.

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