State aid control as a coordinating instrument for EU industrial policy in the internal market

The European Union’s (EU) industrial policy has gained new relevance amid geopolitical shifts, global competition, and the digital and green transitions. This article examines how the EU State aid law has evolved from a strict prohibition model to a more flexible regime that coordinates industrial policy within the internal market. Through instruments such as the General Block Exemption Regulation, Important Projects of Common European Interest, crisis frameworks, and the Clean Industrial Deal State Aid Framework, the Commission increasingly facilitates targeted aid to support green technologies, innovation, and strategic autonomy. While this shift enables faster resource mobilization, it also raises concerns over competitive neutrality and widening economic divergence among Member States. This article critically assesses these developments, highlighting both opportunities and risks. Ultimately, balancing ambitious industrial goals with market fairness remains a central challenge, while further stand-alone industrial policy is still required.