What is InvestEU?
The InvestEU Programme includes the InvestEU Fund, the InvestEU Advisory Hub, and the InvestEU Portal.
InvestEU is the single EU investment support mechanism for internal action, replacing all existing financial instruments. It is the bigger version of the previous EFSI programme.
The InvestEU Fund is expected to mobilise more than €372 billion of public and private investment through an EU budget guarantee of €26.2 billion that backs the investment of financial partners such as the European Investment Bank (EIB) Group and others.
Its overall objective is to support the EU policy objectives by mobilising public and private investment within the EU that fulfil the criterion of additionality, thereby addressing market failures and sub-optimal investment situations that hamper the achievement of EU goals regarding sustainability, competitiveness and inclusive growth.
The InvestEU Advisory Hub is the central entry point for project promoters and intermediaries seeking advisory support and technical assistance.
Additionally, the InvestEU Portal brings together investors and project promoters on a single EU-wide database of investment opportunities available within the EU.
Managing authorities may decide to contribute to InvestEU and have their Financial instruments implemented through the four policy windows.
Applicable rules are those of InvestEU (Art. 10 CPR Regulation)
Structure
Eligibility of projects
Projects must:
- Address market failures or investment gaps and be economically viable
- Need EU backing in order to get off the ground
- Achieve a multiplier effect and where possible crowd-in private investment
- Help meet EU policy objectives
The eligibility criteria are defined in the InvestEU Regulation and in the Investment Guidelines.
Attention on social investments
InvestEU places more emphasis on social investment and skills. InvestEU allocates €2.8billion of the EU guarantee to this policy area (compared to the EFSI window of €2.2 billion in 2014-2020)
InvestEU also supports strategic investments including Important Projects of Common European Interest to support final recipients whose activities are of strategic importance to the EU, in particular in view of the green and digital transitions, of enhanced resilience and of strengthening strategic value chains.
Combination with grants
Combining InvestEU financing and EU grants may be necessary in some situations to address particular market failures or investment gaps. The InvestEU Fund can be combined with grants or financial instruments (or both), funded by the centrally managed EU budget or by the EU Emissions Trading System (ETS) Innovation Fund. Such combinations can create advantages for project promoters. When a project uses EU grants and InvestEU, the InvestEU rules will apply for the entire project. This means a single rulebook and a major simplification.
Not State Aid
In order to match InvestEU objectives to address market failures and mobilise private investment, it has to be easy to link up Member State money – which may entail State aid and be subject to State aid rules – with EU funds managed centrally by the Commission, which do not constitute State aid.
To further streamline the State aid approval process for such joint funding, in June 2018 the Commission proposed an amendment to one of the Council regulations governing EU State aid control. The Council adopted this amendment in November 2018. This revised enabling regulation allows the Commission, subject to certain conditions, to exempt Member State funding channelled through the InvestEU Fund or supported by the InvestEU Fund from the requirement to notify such interventions to the Commission prior to their implementation.
The funding from Member States would be declared compatible with EU State aid rules, as long as certain clear conditions are fulfilled. The Commission proposal thus ensures that State aid rules can help facilitate a seamless deployment of the InvestEU fund.
InvestEU and State aid rules
While the InvestEU guarantee itself does not constitute state aid, since it is centrally managed by the European Commission, the Member State money linked up to this guarantee may entail state aid and be subject to state aid rules.
However, to further streamline the State aid approval process for such joint funding, the Commission proposed an amendment to one of the Council regulations governing EU State aid control, which was adopted in November 2018. This updated regulation empowers the Commission to grant exemptions to Member States, under specified conditions, from the obligation to notify the Commission before implementing funding channeled through the InvestEU Fund or backed by it.
The funding from Member States would be declared compatible with EU State aid rules, as long as certain clear conditions are fulfilled. The Commission proposal thus ensures that State aid rules can help facilitate a seamless deployment of the InvestEU fund.
How to apply?
You should apply directly to implementing partners who will offer tailor-made financing solutions based on the financial products supported by the EU guarantee.
Beneficiaries
The eligible final recipients can be natural or legal persons established in an EU country or in a Third Eligible Country, including:
- Private entities such as special-purpose vehicles (SPV) or project companies, large corporates, midcap companies, including small midcap companies, and SMEs
- Public sector entities (territorial or not) and public-sector type entities
- Mixed entities, such as public–private partnership (PPPs) and private companies with a public purpose
- Non-for-profit organisations
Example: Hannover Social and Affordable Housing – Germany
Total cost: EUR 204 million
EIB loan: €60 million (backed by the InvestEU guarantee)
Hanova WOHNEN GmbH project benefited from a €60 million EIB loan backed by the InvestEU guarantee. The project aims for the construction of approximately 640 new social and affordable housing units for rent, of which approximately 232 will be allocated to social housing (36%) and approximately 408 units will be designated as affordable housing (64%). All housing units will be barrier free and approximately 12% will be wheelchair accessible. The project will include two day-care centres for children at ground floor level[1].
For checking the legal background of InvestEU, click here.
Find more examples on the InvestEU portal