Subsidies

What we do

A subsidy is a financial contribution made available by an administrative body – often the municipality or another government body – for specific activities of the applicant, other than as payment for delivered goods or services. This public law entitlement is regulated in Title 4.2 of the General Administrative Law Act (Article 4:21 General Administrative Law Act).

Subsidies play a role in countless areas of the social domain: from welfare work, youth care, and social support to making homes more sustainable, such as roof, floor, or ground insulation. Private individuals as well as municipalities, associations, foundations, cooperatives, and private limited companies can apply for or provide subsidies.

We assist both the granting authority and the applicant and recipient. Whether you are an international corporation applying for an innovation grant or the baker on the corner missing out on a sustainability subsidy: our mixed teams of lawyers and in-house counsel can help you. Questions about subsidies? Please contact us!

Granting and determination of subsidies

In principle, the subsidy process involves two decision points. First, the administrative body makes a decision to grant a subsidy: a conditional entitlement to an amount for activities yet to be performed (Article 4:29 et seq. of the General Administrative Law Act). An advance payment often follows. After the completion of the subsidized activities, the final subsidy determination (Articles 4:42 to 4:47 of the General Administrative Law Act), during which the administrative body verifies whether the conditions have been met. Only with the determination does an unconditional entitlement to payment arise.

The administrative body may set the subsidy at a lower amount than granted pursuant to Article 4:46 of the General Administrative Law Act, for example because the activities did not take place, or did not take place in their entirety, or because the obligations were not met. For both a municipality providing a subsidy and a recipient – ​​ranging from a large care institution to a small sports club – it is crucial that the conditions, the reporting obligation, and the accountability are clearly and demonstrably complied with.

Withdrawal and recovery of subsidy

An administrative body may revoke a subsidy grant or determination subject to conditions, or amend it to the detriment of the recipient. During the granting phase, this is done on the basis of Article 4:48 of the General Administrative Law Act; after determination, the stricter grounds of Article 4:49 of the General Administrative Law Act apply (for example, incorrect or incomplete data). Pursuant to Article 4:57 of the General Administrative Law Act, unduly paid subsidy amounts may be recovered, subject to a limitation period of five years from the day of determination.

The principle of proportionality plays an increasingly important role in recovery proceedings : the administrative court assesses whether the consequences of a (full) recovery are not disproportionate in relation to the defect. We assess whether a recovery decision stands up in court and conduct the defense on behalf of the government or the tax collector.

Objection and appeal against subsidy decisions

Virtually every subsidy decision is a decision within the meaning of Article 1:3 of the General Administrative Law Act, against which legal protection is available. You may lodge an objection with the administrative body within six weeks , followed by an appeal to the district court and a further appeal to the Administrative Jurisdiction Division of the Council of State. If an advance payment is reclaimed, a timely and well-substantiated objection is of great importance.

A strong notice of objection or appeal requires thorough knowledge of subsidy law and the associated regulations. We determine whether a procedure has a chance of success, submit a statement of views or objection, and assist you in appeal and higher appeal proceedings.

Subsidy and state aid

Subsidies to undertakings carrying out an economic activity may qualify as state aid within the meaning of European regulations (Articles 107 and 108 of the Treaty on the Functioning of the European Union). Unlawfully granted state aid can be recovered, with significant financial consequences for both the granting authority and the recipient. We advise on state aid risks, the application of the De Minimis Regulation and the General Block Exemption Regulation, to ensure that a subsidy is structured in a legally sound manner.

Subsidies within the social domain

In the social domain, municipalities provide subsidies for, among other things, social support, youth care, welfare, and participation. The choice between subsidy and tendering requires careful consideration and touches upon our expertise regarding tendering in the social domain and contracts in the social domain. The Social Support Act (Wmo), the Youth Act , and the Participation Act often play a role in the conditions and objectives of a subsidy scheme.

Subsidies form part of our broad expertise within the Social Domain. Whether you are a municipality, an international corporation, or the baker on the corner: our lawyers and in-house counsel guide you through the entire cycle of application, determination, and potential objection or recovery.