The Serbian Government has published a Draft Regulation on the Conditions and Criteria for Harmonization of Horizontal State Aid, focusing on support for micro, small, and medium-sized enterprises (SMEs). This regulation encourages the development of economic activities such as research, innovation, employment, education, sports, local infrastructure, and recovery from natural disasters. It applies to all sectors except cases related to unprofitable coal mine closures or aid conditional on exports, use of domestic products, or location in Serbia.
Horizontal state aid must be transparent, meaning its amount can be calculated in advance without additional risk assessment. This includes subsidies, subsidized interest rates, loans with known reference rates, state guarantees, tax breaks, and subsidized advisory services. The aid intensity is determined based on eligible costs excluding VAT, and can be increased in special cases, such as advance payments or repayment obligations tied to project success.
Aid must be requested before project work begins to be considered an incentive. For large companies, proof that the aid significantly expands or accelerates the project is required. Aid is automatically considered incentive for micro-enterprises in energy supply, market disruptions, employment, and disaster recovery. Entities ordered to repay illegal aid or in financial difficulty cannot receive aid unless under natural disaster schemes.
Support for SMEs includes investments, advisory services, participation in fairs, European cooperation projects, and energy supply, especially during crises. Eligible investments cover tangible and intangible assets, wage costs for new jobs related to the project over two years, or a combination thereof. Tangible assets include land, buildings, and equipment, while intangible assets include patents and licenses that must be used exclusively by the beneficiary and remain on their balance sheet for at least three years. Employment aid covers gross wages for newly created jobs, with requirements that jobs remain filled for at least three years.
Aid intensity for investments is up to 20% for micro and small enterprises and up to 10% for medium-sized, with a maximum of 8.25 million euros per project. Advisory services may be subsidized up to 50%, excluding common services like tax advice, with a maximum aid of 2.2 million euros. Participation in fairs and European cooperation projects is also subsidized up to 50%, with the same maximum amount, except smaller projects may receive up to 22,000 euros.
State aid for research, development, and innovation covers projects under programs such as Horizon 2020 and Horizon Europe. Eligible costs include salaries, equipment, buildings, land, external services, and operating costs. Aid intensity varies by activity type, with up to 100% for basic research, 50% for industrial research, and 25% for experimental research. Maximum aid per project ranges from 8.25 million to 55 million euros depending on the research type. Advance payments are allowed with repayment obligations if the project succeeds, increasing the aid amount by 50%.
Support is also available for research infrastructure, innovative clusters, and participation in European research programs, with aid intensity up to 50-60% and maximum amounts reaching 35 million euros. Aid for laboratories and testing facilities can cover up to 25% of costs with a maximum of 25 million euros, potentially higher for SMEs.
SMEs can receive aid for innovation, including patent protection, highly educated personnel, advisory and infrastructure services, up to 50% of eligible costs or a maximum of 10 million euros. Consultancy and support services can be subsidized up to 100%, with a limit of 220,000 euros over three years, provided qualified personnel are involved. Process and organizational innovations receive up to 50% aid for SMEs and 15% for larger companies, with a maximum of 12.5 million euros.
Training aid covers lecturer and trainee costs, advice, and administration, with a base intensity of 50%, increased up to 70% for vulnerable groups and SMEs, with a maximum of 3 million euros per project. Employment aid for vulnerable groups subsidizes wages up to 50%, with a maximum of 5.5 million euros per year per company, and up to 75% for people with disabilities, capped at 11 million euros per year per company.
