New EU State Aid Rules: Leaseurope calls for equal treatment and for the specificities of leasing to be considered

The European Commission has been consulting the stakeholders in order to review the current General Block Exemption Regulation (GBER). The GBER allows Member States to grant state aid directly to businesses without requiring prior approval from the European Commission. It declares specific categories of state aid compatible with the Treaty on the Functioning of the EU (Article 107 & 108 of TFEU), meaning they do not lead to competition distortion and provided they fulfil certain conditions, they are exempted from the requirement of prior notification and Commission approval. 

Following a public consultation and call for evidence in 2025, to which Leaseurope contributed, the Commission published a draft for a revised GBER with the aim to simplify it and bring it in line with market developments. The draft for a revised GBER, which was under consultation last spring, covers some types of aid that are most likely to be relevant to equipment or motor finance and it includes some amendments that appear to be useful improvements for leasing. 

Keys points of the draft revised GBER

In general, any programme that works for loans continues to work also for leases. The revised GEBR provides for a definition of loans whereby it includes “a lease which provides the lender with a predominant component of minimum yield”.  This standard definition of loans and leases should mean that financial leases with or without transfer of ownership can be eligible for state aid. This is in line with Leaseurope’s call for equal treatment of leasing compared to other financial products in order to give the recipients the choice to decide which instrument is more appropriate for them.  

New articles (Art. 27 & 28) of draft GEBR on risk finance programmes should now render it easier to establish equivalent risk support-based arrangements at member state level. The standard definition of leases, without the requirement for transfer of ownership is used also in this GBER section. 

The article of draft GBER on investment aid concerning clean vehicles or zero-emission vehicles (Art. 54), includes aid for the acquisition and leasing of such vehicles with the leases being of a duration of “at least 12 months”. The requirements for a lease contract of a duration of at least one year overrides the standard definition of leases, mentioned above. Further Commission guidance is expected on this, but by adding aid for vehicles into a separate article and by removing the reference to Net Present Value of the cost of the investment (i.e. residual value of the vehicle), it seems clearer now that operating leases with no transfer for ownership are in-scope and can be eligible for state aid. 

However, there are still specific requirements in the articles concerning “regional investment aid for assisted areas” and “investment aid to SMEs for new or extended facilities” (Art.15 & 20 of draft GBER), whereby leases must involve a transfer of ownership. Particularly, “for plant or machinery, the lease must take the form of financial leasing and the aid beneficiary shall commit to purchase the asset at the expiry of the term of the lease”. Leaseurope has repeatedly called for the adjustment of such strict requirement, as it renders the grant of aid via leasing problematic in many instances. This is because, in accordance with tax rules in several EU countries, a contract that includes a clause requiring the lessee to (commit to) exercise the option to purchase the asset, may be considered a sale (instalment sale), not a financial lease contract. This effectively rules out leasing as a finance option compared to other options of finance.

Our contribution

Leaseurope’s contribution to the Commission’s consultation reiterated that EU state aid rules must not unreasonably differentiate against lease agreements when it comes to the eligibility criteria. This is because, from a recipient’s perspective, procurement of asset by means of financial leasing or loan financing is practically identical from an economical point of view. In the case of both financial leasing and loan, the recipient uses the asset starting at the same time for a substantial part of the asset’s economic life, regardless of ownership right. The lessee uses the asset, and at the same time gains economic benefit from its use, in the same way as any other owned asset. Moreover, in many leasing arrangements, there is a purchase option, with effects substantially equivalent to a purchase financed by a loan. 

Furthermore, one of Leaseurope’s main messages is that the new EU state aid rules should be focused on asset usage rather than legal ownership. In our response, we suggest adding a simple definition of lease, clearer as compared to the wording of the draft GBER referring to “predominant component of minimum yield”. The definition of lease should be based on the international lease accounting rules IFRS 16, whereby a contract is a lease when that conveys the right to control the use of an identified asset for a period of time in exchange for consideration. 

The Legal Affairs Committee of Leaseurope is preparing a set of Q&A on this topic that could support member associations to discuss the design of schemes at national level as well as assist further discussions with EU stakeholders. 

The Commission will now revise the draft and is expected to adopt the revised GBER by the end of 2026, with the entry into force on 1 January 2027. Finally, the Commission intends to issue a supporting guidance document, clarifying the interpretation of the GBER. Leaseurope has been calling for guidance specifically on the inclusion of leasing in State Aid programmes, providing practical advice on adaptations to scheme terms and conditions that may be appropriate for the specificities of leasing.