Brussels, 8 August 2023
The European Commission has approved, under EU State aid rules, a €350 million Finnish scheme to support sustainable forest management. The aim of the scheme is to help private forest owners implement economically, ecologically and socially sustainable forest management and use techniques to (i) promote the growth of forests, (ii) adapt forests to climate change, (iii) protect biodiversity, (iv) promote water protection in forestry, and (v) maintain the forestry road network.
Under the scheme, which will run until 31 December 2029, the aid will take the form of direct grants to private forest owners. In particular, the direct grants will support: (i) remedial fertilisation, (ii) peatland forest management plans, (iii) forest nature management plans, (iv) water protection measures, including road embankment construction, (v) forest road construction, (vi) prescribed burning, as well as (vii) the compensation for income losses of private forest owners resulting from the implementation of measures to preserve biodiversity in forests. The maximum amount of aid per beneficiary is €100,000 per project. For road embankment construction and compensation for income losses specifically, the maximum aid amount is €300,000 per beneficiary.
The Commission assessed the scheme under EU State aid rules, in particular Article 107(3)(c) TFEU, which allows Member States to support the development of certain economic activities under certain conditions, and the 2023 Guidelines for State aid in the agricultural and forestry sectors and in rural areas. The Commission found that the scheme is necessary and appropriate to support the development of the forestry sector. Furthermore, the Commission found that the aid will have an ‘incentive effect’ as the beneficiaries would not carry out the investments in the absence of the public support. Finally, the Commission concluded that the scheme is proportionate, as it is limited to the minimum necessary, and and will have a limited impact on competition and trade between Member States. On this basis, the Commission approved the Finnish scheme under EU State aid rules.
The non-confidential version of the decision will be made available under the case number SA.106581 in the State aid register on the Commission’s competition website once any confidentiality issues have been resolved.
Source – EU Commission