1.11.2006 Official Journal of the European Union L 302/29 COMMISSION REGULATION (EC) No 1628/2006 of 24 October 2006 on the application of Articles 87 and 88 of the Treaty to national regional investment aid (Text with EEA relevance) THE COMMISSION OF THE EUROPEAN COMMUNITIES, Having regard to the Treaty establishing the European Community, Having regard to Council Regulation (EC) No 994/98 of 7 May 1998 on the application of Articles 92 and 93 of the Treaty establishing the European Community to certain categories of horizontal State aid (!), and in particular points (a)(i) and (b) of Article 1(1) thereof, Having published a draft of this Regulation (?), After consulting the Advisory Committee on State Aid, Whereas: (1) Regulation (EC) No 994/98 empowers the Commission to declare, in accordance with Article 87 of the Treaty, that under certain conditions aid that complies with the map approved by the Commission for each Member State for the grant of regional aid is compatible with the common market and is not subject to the notification requirement of Article 88(3) of the Treaty. (2)  The Commission has applied Articles 87 and 88 of the Treaty to regional investment aid schemes in assisted areas in numerous decisions and has also stated its policy, in particular in the guidelines on national regional aid for 2007 to 2013 (}) as well as in Commission Regulation (EC) No 70/2001 of 12 January 2001 on the application of Articles 87 and 88 of the EC Treaty to State aid to small and medium-sized enterprises (). In the light of the Commission’s consi- derable experience in applying Articles 87 and 88 of the Treaty to regional investment aid and in the light of the guidelines on national regional aid issued by the Commission on the basis of those provisions, it is appro- () O] L 142, 14.5.1998, p. 1. () 0] C 120, 20.5.2006, p. 2. () O] C 54, 4.3.2006, p. 13. () OJ L 10, 13.1.2001, p. 33. Regulation as amended by Regulation (EQ) No 1040/2006 (O] L 187, 8.7.2006, p. 8). priate, with a view to ensuring efficient supervision and simplifying administration without weakening Commission monitoring, that the Commission should make use of the powers conferred by Regulation (EC) No 994/98. By addressing the handicaps of the disadvantaged regions, national regional aid promotes the economic, social and territorial cohesion of Member States and the Community as a whole. National regional investment aid is designed to assist the development of the most disadvantaged regions by supporting investment and job creation in a sustainable context. It promotes the expansion, rationalisation, modernisation and diversifi- cation of the economic activities of undertakings located in the less-favoured regions, in particular by encouraging firms to set up new establishments there. In order to determine whether or not aid is compatible with the common market pursuant to this Regulation, it is necessary to take into consideration the aid intensity and thus the aid amount expressed as a grant equivalent. The calculation of the grant equivalent of aid payable in several instalments requires the use of market interest rates prevailing at the time of grant. With a view to a uniform, transparent, and simple application of the State aid rules, the market rates for the purposes of this Regu- lation should be deemed to be the reference rates which are periodically fixed by the Commission on the basis of objective criteria and published in the Official Journal of the European Union and on the Internet. In order to ensure transparency and effective monitoring, this Regulation should apply only to regional investment aid schemes which are transparent. These are aid schemes in which it is possible to calculate precisely the gross grant equivalent as a percentage of eligible expenditure ex ante without a need to undertake a risk assessment (for example grants, interest rate subsidies and capped fiscal measures). Public loans should be considered to be trans- parent provided that they are backed by normal security and do not involve abnormal risk and are therefore not considered to contain a state guarantee element. In principle, aid schemes involving state guarantees or public loans with a state guarantee element should not be considered as transparent. However, such aid schemes should be considered as transparent if, before the imple- mentation of the scheme, the methodology used to calculate the aid intensity of the state guarantee has been accepted by the Commission following notification to the Commission after adoption of this Regulation. The