What was originally intended as a clear bureaucratic simplification for Member States and businesses has, over the years, evolved into an increasingly lengthy and complex legal instrument. Complicated structures, ambiguous terminology, and extensive documentation requirements have led to legal uncertainty and misinterpretations, making the application of the GBER more difficult for both companies and funding authorities. The European Commission is therefore undertaking a comprehensive revision of the GBER by the end of 2026. The overarching objective is to streamline and simplify the complex text in order to significantly reduce the administrative burden for both companies and Member States, thereby facilitating the support needed by industry. Following the publication of an initial draft revision in spring 2026 and a public consultation process, a second revised draft was circulated to Member States for discussion in summer 2026.

The GBER can only fulfill its purpose if its provisions are clear, consistent, and easy to apply. The overall goal of the reform must be to ensure that companies, especially SMEs, as well as national funding institutions, can apply the GBER in a legally secure and uncomplicated manner. The draft versions of the new GBER released so far already contain promising approaches to simplification, including a new structure, clarifications of definitions and specific aid categories, and more flexible conditions and reporting requirements. The BDI also welcomes the planned inflation-related increase in financial thresholds in two stages from 2027 and 2031 onwards. However, the proposed reduction of certain aid intensities, for example for specific environmental protection and recycling measures, is viewed critically.

Exceptions for “Undertakings in Difficulty”

One key issue concerns which companies are eligible to receive public funding. As a rule, GBER aid may not be granted to companies classified as “undertakings in difficulty.”

The challenge lies in the fact that companies are classified as “undertakings in difficulty” based on rigid quantitative criteria, without sufficient consideration of their actual economic prospects. Temporary deviations in balance sheet indicators, for example as a result of substantial research and development investments or short-term losses, often lead to companies losing access to public funding, even though their underlying economic outlook remains sound. The BDI therefore advocates a more comprehensive revision of the definition of an undertaking in difficulty. Assessments should place greater emphasis on factors such as future business prospects, research intensity, intangible assets, funding situation, and integration within a corporate group.

It is positive that the Commission's draft proposals expand the possible exceptions to the definition of an undertaking in difficulty in certain areas, for example for innovative start-ups during their first five years of operation. Another important development is the possibility for companies classified as undertakings in difficulty to continue benefiting from tax reductions under the Energy Taxation Directive. Until now, the strict definition has frequently caused problems in this area, as companies facing economically challenging situations, even if only temporarily, were often excluded from important relief measures. If this exception remains in the final version of the revised GBER, it would represent a significant improvement.

Focus on Simplification and Reducing Bureaucracy

Efforts to simplify the GBER should also pay greater attention to its implementation at the national level. This includes shorter processing times, greater planning certainty in approval procedures, and accelerated procedures where appropriate. Clear rules on the maximum period between project submission and funding decisions would provide companies with additional certainty. Particularly in innovation-driven industries, the speed of funding procedures can determine the success of a project. Lengthy approval processes result in the loss of valuable development time. The BDI therefore advocates allowing projects to start at the applicant’s own risk under certain conditions before formal approval of the funding is granted.

From the perspective of businesses, the simplified cost options envisaged in the GBER drafts still raise questions. Their success will depend on which calculation methods are accepted in the future and whether they accurately reflect companies’ actual cost structures. Maintaining the freedom to choose between simplified lump-sum approaches and established reimbursement models will remain crucial.

Another important issue is the better alignment of national and European funding instruments, such as Horizon Europe and the Innovation Fund. Different requirements for national and European funding applications create inefficiencies and hinder hybrid financing models. Improvements are particularly needed in administrative procedures. Different application processes and tools, multiple language versions, and duplicate reporting obligations generate unnecessary effort. Greater harmonisation and better interconnected funding portals would facilitate the combination of various funding instruments, reduce bureaucratic barriers, and simplify the coordination of EU funding and national state aid.

Higher Aid Intensity for Applied Research

In the field of research funding, the Commission proposes a new funding category entitled “applied research.” Its purpose is to simplify the often difficult distinction between industrial research and experimental development, thereby reducing administrative burdens.

From the BDI’s perspective, however, the proposed aid intensity should be closer to the current rate applicable to industrial research. Otherwise, there is a risk that projects may receive lower levels of support in the future, even though their content would qualify as industrial research. Funding authorities could choose the more easily demonstrable category of “applied research” even when a project clearly focuses on industrial research activities.

Industry also calls for the GBER to be more strongly aligned with the goals of technological sovereignty and resilience. For example, aid should also be available for the development of strategic technologies that are currently predominantly sourced from outside Europe. Furthermore, consideration should be given to adapting the state aid framework more effectively to innovation-intensive business models with long development cycles. In sectors such as deep tech, financing gaps often emerge only in later stages of development, for example between clinical development, pilot facilities, and industrial scale-up.

The reform of the GBER presents an opportunity to make European state aid law simpler, more predictable, and more innovation-friendly. Whether this objective is achieved will depend on whether the final version genuinely addresses the practical challenges faced by companies and funding authorities and delivers a noticeable reduction in existing bureaucracy.