This regular alert covers key regulatory EU developments related to the COVID-19 situation. It does not purport to provide an exhaustive overview of developments and contains no analysis or opinion.

This COVID-19 Update will soon be transitioning to the new EU Emergency Response Update – Key Policy & Regulatory Developments, which will continue to cover key regulatory developments related to EU emergency responses, including in particular, to the COVID-19 and Ukraine-Russia situations.

LATEST KEY DEVELOPMENTS

Competition & State Aid

  • European Commission publishes Communication on Recovery and Resilience Facility: Two years on
  • Entry into force of Amending Regulation to include REPowerEU chapters in recovery and resilience plans
  • European Commission approves further schemes under Ukraine Temporary Crisis Framework
  • European Commission approves further schemes under COVID Temporary Crisis Framework

Trade / Export Controls

  • First year of Russia's war against Ukraine – Remarks from G7, EU and world leaders
  • Council of the European Union expands sanctions against Russia and Wagner Group

Medicines and Medical Devices

  • EMA publishes Human Medicines Highlights 2022
  • EU Member States review COVID-19 measures applicable to travelers from China
  • Croatia, France and Poland join EU strategic reserves for chemical, biological and radiological emergencies

Cybersecurity, Privacy & Data Protection

  • European Commission publishes first version of technical Toolbox for European Digital Identity Wallet
  • Council authorizes Member States to ratify Second Additional Protocol to the Convention on Cybercrime (Budapest Convention)
  • European Commission presents a set of actions to enhance Gigabit connectivity in the EU

COMPETITION & STATE AID

State Aid

European Commission publishes Communication on Recovery and Resilience Facility: Two years on (see here)

21 February 2023, the Commission released a Communication on the Recovery and Resilience Facility (RRF): Two years on – A unique instrument at the heart of the EU's green and digital transformation.

To recall, the RRF, established in response to the COVID-19 pandemic to support faster and more resilient Member State recovery, is the core instrument of the €800 billion NextGenerationEU recovery plan for Europe's green and digital transformation. To date, the Communication reports that the Commission has disbursed a total of over €144 billion under the RRF, in both grants (€97 billion) and loans (€47 billion).

Member State recovery plans set out the reforms and public investment projects foreseen for implementation with the RRF's support. In evaluating Member State plans under the RRF Regulation, notably, the RRF guidelines make clear that the investment projects included in Member State recovery plans must comply with State aid rules (Jones Day Commentary, EU Member State COVID-19 Recovery Plans Must Comply with State Aid Rules, March 2021, see here)

The Communication reports that all national recovery plans are in place, including the revised plans of Luxembourg and Germany, with 16 payment requests already processed, another three already positively assessed and awaiting the Council's opinion, and eight with assessments ongoing.

On concrete Member State reforms and investments under the RRF, the Communication indicates that these include, e.g., reforms to digitalize the public administration (Slovakia) and strengthen cybersecurity (Romania); and licensing simplification reforms to bolster investments in offshore renewables and reforms to create the conditions for introducing renewable hydrogen (Greece, Portugal, Spain).

In presenting the Communication, the Commission notes that the RRF has demonstrated its agility in addressing newly emerging challenges, marked by Russia's war of aggression against Ukraine, high inflation, and an energy crisis. The RRF therefore remains central to advancing the EU's priorities for energy security, industrial competitiveness and transitioning to a net-zero economy.

For example, the recent Green Deal Industrial Plan (see also Jones Day COVID-19 Update No. 97 of 14 February 2023) puts the RRF and REPowerEU Plan (see below on Entry into force of Amending Regulation to include REPowerEU chapters in recovery and resilience plans) at the center of the EU's response to the structural challenges impacting the competitiveness of the EU's clean-tech sector. The RRF funds will be available to Member States to finance measures promoting the greening of industry, supporting EU net-zero industry projects, and assisting energy intensive industries in the face of high energy prices.

On promoting transparency, the Commission's Recovery and Resilience Scoreboard continues to provide real-time information on Member State disbursements and progress under their recovery plans.

Next steps. The Commission anticipates a 2024 mid-term evaluation of the RRF as another opportunity to assess progress made and lessons learned from the RRF's implementation.

Entry into force of Amending Regulation to include REPowerEU chapters in recovery and resilience plans (see here)

On 1 March 2023, the Amending Regulation to include REPowerEU chapters in recovery and resilience plans entered into force.

The Amending Regulation aims at enhancing the EU's strategic autonomy through diversified energy supplies, ceasing dependency on Russian fossil fuel, and accelerating the clean energy transition.

In Spring 2023, Member States are expected to add a new REPowerEU chapter to complement their national recovery plans under the Recovery and Resilience Facility (RRF, see above on Communication on Recovery and Resilience Facility). These new REPowerEU chapters will seek to finance key investments and reforms towards achieving at least one of the objectives set out in the Amending Regulation, such as:

  • boosting energy efficiency in buildings and critical energy infrastructure
  • decarbonizing industry
  • increasing the production and uptake of sustainable biomethane and of renewable or fossil-free hydrogen
  • increasing the share and accelerating the deployment of renewable energy
  • addressing internal and cross-border energy transmission and distribution bottlenecks
  • supporting zero-emission transport and its infrastructure, including railways

The Commission anticipates that the REPowerEU-driven reforms and investments will further the EU's recently unveiled Green Deal Industrial Plan by financing measures such as supporting EU net-zero industry projects and incentivizing research and innovation in zero emission technologies.

Member States will have access, in particular, to an additional €20 billion in new grants to finance planned investments and reforms under REPowerEU. The financing sources will be the Innovation Fund (60%) and the earlier auctioning of national emission allowances under the EU Emissions Trading System (ETS)(40%) (for further details on the ETS, see Jones Day COVID19 Update No. 97 of 14 February 2023)

The Amending Regulation further increases transparency by requiring Member States to create easy-to-use public portals to publish information on the 100 largest final recipients receiving the highest amount of RRF funding for implementing measures under national plans.

The role of stakeholders is also reinforced, focusing on local and regional authorities and social partners, and most notably at the preparation stage of the REPowerEU chapters and throughout the overall implementation of the national plans.

Member States seeking to revise their national plans will be required to provide the Commission with a summary of their consultation process, including information on stakeholders consulted and how their input was reflected in the REPowerEU chapters.

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