Support for EU remains at historically high level despite sceptics


The InvestEU Programme will
bring together under one roof the multitude of EU financial instruments
currently available to support investment in the EU, making funding for
investment projects in Europe simpler, more efficient and more flexible.

The InvestEU Programme
consists of the InvestEU Fund, the InvestEU Advisory Hub and the InvestEU
Portal. It will further boost job creation and support investment and
innovation in the EU.

InvestEU will run between 2021
and 2027 and it builds on the success of the Juncker Plan’s European Fund for
Strategic Investments (EFSI) by providing an EU budget guarantee to support
investment and access to finance in the EU. InvestEU aims to trigger at least
€650 billion in additional investment.

The InvestEU Fund will support
four policy areas: sustainable infrastructure; research, innovation and
digitisation; small and medium-sized businesses; and social investment and
skills. InvestEU will also be flexible: it will have the ability to react to
market changes and policy priorities that change over time.

The InvestEU Advisory Hub will
provide technical support and assistance to help with the preparation,
development, structuring and implementation of projects, including capacity

The InvestEU Portal will bring
together investors and project promoters by providing an easily-accessible and
user-friendly database.

Why do we need InvestEU?

The investment conditions in
Europe have improved since the Investment Plan for Europe, the Juncker Plan,
was launched, thanks to structural reforms carried out by the Member States, a
more a favourable economic situation and interventions such as EFSI. To help
investment recover further, InvestEU will continue the work of the Juncker Plan
to mobilise public and private resources in the EU. It will help to address
market failures and investment gaps to foster jobs and growth and to reach EU
policy goals such as sustainability, scientific excellence and social

How will the InvestEU Fund

The InvestEU Fund will
mobilise public and private investment through an EU budget guarantee of €38
billion that will back the investment projects of the European Investment Bank
(EIB) Group and other financial partners, and increase their risk-bearing
capacity. The financial partners are expected to contribute at least €9.5
billion in risk-bearing capacity. The guarantee will be provisioned at 40%,
meaning that €15.2 billion of the EU budget is set aside in case calls are made
on the guarantee.

The InvestEU Fund will be
implemented through financial partners who will invest in projects using the EU
guarantee. The main partner will be the EIB Group, which has successfully
implemented and managed EFSI since its launch in 2015. In addition to the EIB
Group, International Financial Institutions active in Europe – such as the
European Bank for Reconstruction and Developments (EBRD), the World Bank and
the Council of Europe Development Bank – and National Promotional Banks will
have direct access to the EU guarantee.

The InvestEU Fund will also
feature a Member State compartment for each policy area, meaning that Member
States may add to the EU guarantee’s provisioning by voluntarily channelling
some of their Cohesion Policy funds to these compartments. Like this, Member
States will benefit from the EU guarantee and its high credit rating, giving
national and regional investments more firepower.

What’s the advantage compared
to the status quo, especially for the final beneficiaries?

Creating one coherent
programme benefits from economies of scale. It achieves greater risk
diversification, has a more integrated governance structure, and mainstreams
cross-sectorial policies, bringing a multitude of instruments under one single
structure. Using a budget guarantee – and not only financial instruments or
grants – can help increase the impact of public funds. In this way we can do
more with less.

The new approach also helps to
reduce uncertainty for final beneficiaries and financial intermediaries about
which instrument is the best for them.

Under the InvestEU Fund, there
will be a single programme with a strong identity and a single set of coherent
requirements (for eligibility, monitoring and reporting), which will apply
throughout the financing chain to the benefit of financial intermediaries and
final beneficiaries. InvestEU will eliminate overlaps and ensure synergies both
for financing and advisory services. The InvestEU Advisory Hub will integrate
13 different advisory services into a one-stop-shop.

Also, when blending grants
from other programmes like Horizon Europe, the Single Market Programme or the
Connecting Europe Facility with support from InvestEU, InvestEU rules will
apply for the entire project. This is a major simplification compared to today.

What will InvestEU finance?

The InvestEU Fund will be
market-based and demand-driven. By crowding-in private investors, it will help
achieve the EU’s ambitious goals in sustainability, scientific excellence and
social inclusion. Investments will come under four policy areas, which
represent important policy priorities for the Union and bring high EU added value:

  • sustainable infrastructure;
  • research, innovation and digitisation;
  • small and medium-sized enterprises (SMEs) and small mid-caps;
  • social investment and skills.

The budget guarantee is
divided between the policy areas as follows:

Sustainable infrastructure: 
€11.5 billion

Research, innovation and
digitisation: €11.25 billion

SMEs:   €11.25

Social investment and
skills:  €4 billion

The Commission can adjust
these amounts by up to 15% in each policy window to adapt to evolving policy
priorities and market demand.

Who will manage InvestEU?

As in the case of EFSI, a Steering
will give strategic direction on programme implementation. It will be
composed of the Commission (four members), the EIB Group (three members) and
other implementing partners (two members – International Financial Institutions
such as the European Bank for Reconstruction and Development or National
Promotional Banks), as well as a non-voting expert appointed by the European
Parliament. The Steering Board will strive to take its decisions by consensus.

An Advisory Board will
assist the Steering Board. It is composed of representatives of implementing
partners (one member each) and Member States (one member each). The agreement
between the European Parliament and the Council extends membership to the Committee
of the Regions and the Economic and Social Committee (one member each). The
Commission will be able to consult this board when preparing and designing new
financial products or to follow market developments and share information. This
Advisory Board will be able to issue recommendations to the Steering Board on
the implementation and functioning of the InvestEU programme.

An Investment Committee
will approve the individual guarantee requests. This Committee is composed of
external experts selected in an open process, and remunerated by the EU budget.
The Investment Committee will be assisted by a secretariat, which will be
staffed by and located in the Commission. The secretariat will provide
administrative support for the organisation of meetings, agendas, minutes and
interact with the implementing partners as appropriate to ensure the files
transmitted to the Investment Committee are complete.

The EIB as the strategic
may send its guarantee requests directly to the Investment
Committee. This will be subject to notification to the secretariat, based in
the Commission, which will assume all horizontal tasks and handle the guarantee
requests of all other implementing partners.

Who will choose the InvestEU

Just as is the case under EFSI,
the Investment Committee will select projects based on compliance with the
eligibility criteria set by the Regulation as well as the Investment
Guidelines, with a specific focus on additionality.

Members of the Investment
Committee will be external experts with expertise from the relevant sectors.
The Committee will meet in four different configurations corresponding to the
policy windows.

The Committee’s decisions will
be made independently, with no political interference.

In practice, Commission
services will first verify the consistency of the proposed operations with EU
law and policies. Projects passing this initial check will be passed on to the
Investment Committee.

The Investment Committee will
approve the use of the EU guarantee for financing and investment operations,
taking its decision after assessing the project scoreboard presented by the
implementing partners. Just as under EFSI, all decisions approving the use of
the EU guarantee will be publicly available.

What will be the InvestEU
eligibility criteria?

InvestEU projects must:

  • address market failures or investment gaps and be economically-viable
  • need EU backing in order to get off the ground
  • achieve a multiplier effect and where possible crowd-in private investment
  • help meet EU policy objectives.

The eligibility criteria are
defined in the Financial Regulation.

Why does EFSI cease to exist?
Why not just create an EFSI 3.0?

EFSI was launched in July 2015
to boost investment and stimulate economic growth and employment in the EU, at
a time when Europe was still recovering from the financial and economic crisis.
It was originally foreseen to have a short investment period to maximise the
impact, until July 2018. Due to its success, EFSI was expanded in size and
extended in duration in December 2017. Its investment period now lasts until
end-2020, the end of the current long-term budget, or Multiannual Financial
Framework (MFF). No new investments can be undertaken under EFSI after 2020 but
– as with most EU financial instruments – the liabilities run for much longer.

The InvestEU Programme builds
on the success of EFSI, and will continue to create and support jobs across the
EU by following the same model based on an EU budget guarantee.

Is InvestEU taking budget from
other financing programmes? What will happen to programmes like COSME and

The InvestEU Fund will bring
under one roof the 14 EU financial instruments currently supporting investment
in the EU, giving it a single, strong brand. The InvestEU Fund will capture the
objectives of existing instruments such as COSME and InnovFin and be able to
boost investments even further thanks to the larger scale and efficiencies of
the single InvestEU Fund. The four InvestEU Fund policy areas place emphasis on
areas of strategic importance for the EU, with €11.25 billion each of the
guarantee earmarked for small businesses and a further €11.25 billion earmarked
for research, innovation and digitisation.

Can InvestEU financing be
blended with EU grants?

Yes. Blending can be necessary
in some situations to underpin investments in order to address particular
market failures or investment gaps. The InvestEU Fund can be combined with
grants or financial instruments, or both, funded by the centrally managed Union
budget or by the EU Emissions Trading System (ETS) Innovation Fund. Such
combinations can create advantages for project promoters in sectors such as
transport, research and digital. When a project uses EU grants and InvestEU,
the InvestEU rules will apply for the entire project. This means a single
rulebook and a major simplification compared to today.

What will be the risk profile
of investments? What type of investments will the InvestEU Fund be targeting
compared to today’s financial instruments?

The InvestEU Fund will target
economically viable projects in areas where there are market failures or
investment gaps. The InvestEU Fund instruments will seek to attract commercial
financing to a wide range of operations and beneficiaries and will only support
projects where financing could not be obtained at all or not at the required
terms without InvestEU Fund support. It will also target higher risk projects
in specific areas.

In addition, InvestEU places
more emphasis on social investment and skills. The allocation for budgetary
guarantees and financial instruments in the social sector under the current
long-term EU budget amounts to €2.2 billion whereas InvestEU allocates €4
billion of the EU guarantee to this policy area, almost doubling what is
currently available.

What is the expected multiplier
effect for InvestEU? How do you expect to reach €650 billion?

Due to InvestEU targeting
higher risk innovation projects and SMEs, as well as the greater focus on EU
policy objectives, we expect a slightly more conservative multiplier effect
than under EFSI: 13.7 rather than 15. That is to say that for every public euro
that is mobilised through the Fund, €13.7 of total investment, that would not
have happened otherwise, is generated.

The €15.2 billion budget
earmarked for InvestEU allows the EU budget to provide a guarantee of €38
billion. In addition, each financial partner will be expected to contribute
some resources to ensure alignment of interest, adding an estimated total of
€9.5 billion, so the total guarantee will be around €47.5 billion. This in turn
will be leveraged by each financial partner. This means they can lend more than
the guarantee amount. Finally, each InvestEU-backed project will attract other
private and public investors, as we have seen under the Juncker Plan, and we
expect this will trigger at least €650 billion in total investment.

Why is the InvestEU Fund open
to other financial partners? Why not work exclusively with the EIB Group, like
with EFSI?

Given its role as the EU’s
public bank, its capacity to operate in all Member States, and its experience
in managing EFSI, the European Investment Bank (EIB) Group will remain the
Commission’s main financial partner under InvestEU and implement 75% of the €38
billion guarantee. It will also play an important role in the programme governance
and implementation. For the remaining 25%, International Financial Institutions
and National Promotional Banks, which can offer specific expertise and
experience, can become financial partners, subject to conditions.

Opening up the possibility to
benefit from the EU guarantee to other institutions is driven by the fact that
there are other experienced potential financial partners in the EU, which have
specific financial or sectorial expertise, deep knowledge of their local market
or greater capacity to share risk with the EU in some areas. This approach will
enlarge and diversify the pipeline of projects and increase the potential pool
of final beneficiaries.

The Commission wants to ensure
that the beneficiaries of InvestEU can get the best possible support and with
easiest access. The InvestEU Fund will therefore be open to other institutions,
either multilateral or national institutions.

How does an entity become an
implementing partner under InvestEU?

The European Investment Bank
Group – the EU Bank – will be an implementing partner for 75% of the EU
guarantee. For the remaining 25% of the EU guarantee, International Financial
Institutions (the European Bank for Reconstruction and Development, the Council
of Europe Bank, etc.) or National Promotional Banks and Institutions wishing to
become an implementing partner must first undergo a so-called Pillar
Assessment. This means that, as a prerequisite, they must meet requirements in
areas relating to the internal control system, the accounting system, an independent
external audit and rules and procedures for providing financing from EU funds
through grants, procurement and financial instruments.

The process to become an
implementing partner consists of three main steps. First, the interested entity
needs to submit an application to the Commission. Second, Commission services
carry out an eligibility check. If the result is positive, the Pillar
Assessment can take place. It is usually carried out by external consultants
contracted by the interested entity and lasts between six and 18 months. Third,
the Commission issues a call for expression of interest and any entity in the
process of passing the Pillar Assessment can apply to become an implementing
partner. The Commission will discuss the financial products and negotiate a
guarantee agreement with institutions that have answered the call. The Pillar
Assessment needs to be completed on the day of the signature of the guarantee

How does a company apply for
InvestEU financing?

Project promoters should apply
directly to the EIB, to national and regional promotional banks, or to the
national offices of International Financial Institutions such as the EBRD, the
World Bank, or the Council of Europe Development Bank. At that stage, the
financial partners submit a proposal to the Commission to apply for the EU
guarantee. SMEs should continue to apply to their local commercial or public banks
whose financial products are covered by the EU guarantee in their country or
region. The local intermediary will inform them if a particular financing
programme is covered by the InvestEU Fund.

How will the InvestEU
Programme ensure geographical balance?

The InvestEU Programme was
designed to ensure it benefits all Member States, irrespective of their size or
the development of their financial market. The access through other financial
partners – compared to EFSI – should allow the Fund to better serve local needs
and to be complementary to other sources of EU funding under shared management.
Technical assistance under the InvestEU Advisory Hub will address the
specificities of cohesion countries markets and contribute to build up a
project pipeline.

The opening of the guarantee
to national and regional promotional banks aims to better address where the
financing needs are and how best to serve them. Finally, the InvestEU Advisory
Hub will provide comprehensive project development assistance. It will provide
capacity building support to develop organisational capacity and facilitate
market-making activities and the collaboration of sectoral actors. The aim is
to create the conditions to expand the potential number of eligible recipients
in nascent market segments, in particular where the small size of individual
projects raises considerably the transaction cost at the project level.

What about State aid control?

State aid rules are essential
to ensure effective competition, so that consumers and businesses get fair
prices and wider choice in the Single Market. At the same time, in order to
match our InvestEU objectives to address market failures and mobilise private
investment, it has to be easy to link up Member State money – which may entail
State aid and be subject to State aid rules – with EU funds managed centrally
by the Commission, which do not constitute State aid.

To further streamline the
State aid approval process for such joint funding, in June 2018 the Commission
proposed an amendment to one of the Council Regulations governing EU State aid
control. The Council adopted this amendment in November 2018. This revised
Enabling Regulation allows the Commission, subject to certain conditions, to
exempt Member State funding channelled through the InvestEU Fund or supported
by the InvestEU Fund from the requirement to notify such interventions to the
Commission prior to their implementation.

The funding from Member States
would be declared compatible with EU State aid rules, as long as certain clear
conditions are fulfilled. The Commission proposal thus ensures that State aid
rules can help facilitate a seamless deployment of the InvestEU fund. This
continues the spirit of the Juncker Commission, which has already made sure
that 97% of State aid can be implemented without any involvement of the

Who will be accountable for
the investments made?

The financial partners in
InvestEU will be responsible for the financing and investment operations under
the InvestEU Fund since their governing bodies take the final decision on the

The Investment Committee,
composed of independent external experts, will approve the use of the EU
guarantee under the InvestEU Fund to support those operations ahead of the
final decision by the financial partner.

What role will the European
Parliament and Council play?

The European Parliament and
the Council will oversee the implementation of the InvestEU Fund through annual
reporting to the budgetary authority and through the discharge procedure.

They will also be present in
the governance bodies of the programme – Member States in the Advisory Board,
and a non-voting expert appointed by the European Parliament in the Steering

The implementation of the
InvestEU Programme will be evaluated through an interim and a retrospective
evaluation. The conclusions of the evaluations will be communicated to the
European Parliament and Council so that they can feed into the decision-making
process in a timely manner.


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