EU State Aid Rules Present an Obstacle to U.K. Startup Funds

May 18, 2020, 5:41 PM

EU state aid rules have led the U.K. to exclude some startups from government funding aimed at boosting economic activity in the post-pandemic era, Chancellor of the Exchequer Rishi Sunak told Parliament on Monday.

The Future Fund, a 250 million pound ($305 million) fund designed to spur startup activity, excludes firms that receive aid through Enterprise Investment Schemes (EIS) or Seed Enterprise Investment Schemes (SEIS)—vehicles that support investment in startups by offering tax relief to individuals.

The reason for the exclusion is a requirement that the government seek EU approval, which could slow disbursement of the funds, Sunak ...

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