STATE AID – THE MAIN INSTRUMENT IN THE EUROPEAN UNION TO COPE WITH THE ECONOMIC AND FINANCIAL CRISIS

State aid which distorts competition between Member States (MS) is considered incompatible with the Single market if it affects trade between MS. However, Article 107 of the Treaty on the Functioning of the European Union (EU) stipulates categories of state aid, with some of them being compatible with the internal market (social aid, aid in case of natural disasters or severe disturbances in the economy of a MS); another category includes state aid that may be considered compatible with the internal market (aid to promote development in areas with low standard of living or high unemployment; aid to promote projects of European interest or to remedy significant turbulence in a MS’s economy, etc.). This article presents the findings of an analysis of state aid policy changes during the financial and economic crisis in the EU, and aims to highlight the main trends in granting state aid in the EU-28 and Romania, as well as the effectiveness of the crisis-related state aid for financial institutions.