New SGEI Decision: Key Changes at a Glance

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02/13/2026
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What changes does the new SGEI Decision bring? We summarize the key developments – from an expanded scope of application to more relaxed monitoring and transparency requirements.

On January 8, 2026, the new SGEI Decision (2025/2630/EU) came into effect, replacing the previous decision. The new framework introduces significant practical relief in cases where state aid is granted to undertakings for the provision of services of general economic interest (SGEI).

Following our discussion in the first part of this article on the simplifications for the funding of affordable housing, the second part focuses on the main additional amendments and their practical implications.

Background

State aid must generally be notified to and approved by the European Commission prior to being granted. The SGEI Decision provides for various exceptions to this requirement. On the basis of such Decision, aid for SGEI may be granted without prior notification to or approval by the European Commission.

No changes to the definition of SGEI

The concept of SGEI remains undefined in the new SGEI Decision. As a result, public authorities continue to enjoy a broad margin of discretion when entrusting undertakings with SGEI tasks. However, the European Commission retains the right to review such measures for potential abuse.

Expanded scope of application and increased aid thresholds

The existing exemption options for various SGEI categories have been expanded and, in part, further clarified under the new SGEI Decision. In addition to clarifications regarding the promotion of social housing, support for affordable housing is now available for the first time. Furthermore, compensation payments for critical medicines, for example, can now also be granted for the first time.

To account for inflation, the annual ceiling for certain compensation payments has been increased to a maximum of EUR 20 million.

Clarification of the concept of a “Single Undertaking”

The new SGEI Decision now refers to the definition of an undertaking set out in the SGEI De Minimis Regulation (Regulation (EU) 2023/2832). This is particularly relevant for capturing group structures on the beneficiary side.

Simplifications regarding the control of overcompensation

As before, the amount of compensation is limited to what is necessary to cover the net costs of providing the SGEI, including a reasonable profit (prohibition of overcompensation).

The entrusting authority must regularly monitor compliance with the overcompensation prohibition. Under the new rules, such monitoring is now only required at least every five years (previously every three years) and at the end of the entrustment period.

In cases where a lump-sum compensation is granted for the provision of SGEI and subject to certain conditions, the overcompensation control is limited to determining whether the reasonable profit the beneficiary is permitted to earn under the entrustment act appears appropriate ex ante.

Finally, an ex-post overcompensation review is not required if the beneficiary is essentially restricted to providing SGEI, and its annual commercial revenues do not exceed 5% of its total revenues during the entrustment period, and it is legally obliged to reinvest its profits into the SGEI. In such cases, the public authority only needs to ensure that commercial revenues remain ancillary in nature. This provision introduces notable simplifications, particularly for non-profit organizations and municipal housing companies.

Abolition of previous publication obligations and revised transparency requirements

Previously, Member States were required to submit a report to the European Commission every two years on the implementation of the SGEI Decision (as a basis for “SGEI monitoring”). This obligation has now been abolished. The requirement to publish (online or otherwise) information on annual compensation exceeding EUR 15 million has also been removed.

From January 1, 2028, certain information on compensation exceeding EUR 1 million per undertaking and SGEI granted under the SGEI Decision must be recorded and published in a central register. This includes, in particular, details such as the beneficiary, legal basis, amount of aid, and duration of the entrustment. This transparency requirement corresponds to the obligation introduced in Germany at the turn of the year to use the “de minimis” transparency register.

Transitional provisions

The new SGEI Decision includes a transitional provision under which most existing entrustment acts will only remain a valid state aid basis for SGEI until January 8, 2028. Accordingly, action will be required within a maximum of two years. By contrast, valid entrustment acts for social SGEI based on the previous SGEI Decision that were effective before January 8, 2026 will remain valid for their entire term.

Practical implications

The new SGEI Decision opens up new scope for action and brings significant simplifications. However, the careful structuring of entrustment acts remains essential to ensure that compensation for SGEI is granted in compliance with state aid law and to protect beneficiaries from potential recovery claims.

In light of the numerous amendments and the transitional provisions, we recommend that existing entrustment acts be reviewed and, where necessary, adjusted. In many cases, the changes will result in practical simplifications.