Yep, but they rarely give permission. I remember a case with German side Alemannia Aachen who are right on the Dutch/German border and got into Europe a while ago as cup runners-up whilst a 2nd tier side. Their own ground wasn't suitable and they asked to play at Roda JC, just on the other side of the border only some 8 miles away and about a 10 minute drive. The Dutch local authorities gave permission for the games being played there, but UEFA refused permission simply based on the fact there were German grounds available (despite them being much further away) and they ended up having to play in Cologne instead, over an hour's drive away.