P 0.2

Multilayered governance and the regulation of subsidies

An area illustrating the concept of multilayered governance, which encompasses all levels of government alike and in which international administrative law has been emerging over recent decades, is the regulation of subsidies.

Subsidies are an important instrument for pursuing domestic policy goals and redistribution. At the same time, they exert distorting effects on competition, in particular to the detriment of foreign competitors who generally do not benefit from such measures. Interestingly, whereas WTO and EU law limit the discretion of governments to grant subsidies, this is normally not true with respect to domestic law. Switzerland is a case in point. Under Swiss constitutional law, subsidies are required to be based upon statutory provisions. Both on the federal level and on that of the Cantons and communes, this requirement exercises constraining effects but does not bring about full transparency. Furthermore, economic freedom might play a role in guaranteeing non-discrimination and equal conditions of competition between competitors. However, much is unclear on this point.

 

This project seeks to fill this gap. It will suggest ways in which a more coherent and integrated approach can be achieved across the board. By doing so, it will contribute towards understanding and refining the theory of multilayered governance.

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