state aidspart of the competition policy of the EUROPEAN UNION that prohibits Member States granting aid in such a way that it affects trade between Member States. The prohibition strikes at aid which confers an economic advantage on the recipient; it is granted selectively to certain enterprises or products; it may distort competition; it affects trade between Member States. Member States must notify such aid, and it maybe permitted as being in the general interest of the economy without distorting trade.
Collins Dictionary of Law © W.J. Stewart, 2006