State aid measures are important for small and medium-sized enterprises (SMEs) as well as for larger and large companies. They do not occur only in individual cases, but belong to the standard instruments of economic policy and business development. In the context of a free market economy, there are societal (climate protection), macroeconomic (digitalization, reduction of CO2 emissions, energy saving), industry-related or regional funding targets.
However, small and medium-sized enterprises are also frequently target companies of corporate acquisitions. The acquisition ensures their continuation and expands their prospects on the market. In many cases, startups in particular are also supported by subsidies.
In practice, therefore, the question arises whether the subsidies are subsequently unlawful and must be returned if the company loses its SME status as a result of a company acquisition.
In a recent article KUNZ partner Hermann Knott explores this question and deals specifically with the effects of company acquisitions on the subsidies for SMEs, with particular reference to start-ups, for which the share of subsidies in the total financing volume is much greater than for other companies.
The answer not only concerns both EU law and the rights of member states, but is also important for the planning of the buyer and should be regulated in the company purchase agreement by guarantees or exemptions and taken into account in the context of due diligence
Click here to read the article "Is state aid to start-ups and SMEs becoming illegal if the company is sold??"