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C 249/14 EN Official Journal of the European Communities 8.8.

98

STATE AID
C 33/96 (ex N 811/95)
Italy

(98/C 249/05)

(Text with EEA relevance)

(Articles 92 to 94 of the Treaty establishing the European Community)

Commission communication under Article 93(2) of the EC Treaty addressed to the other
Member States and other interested parties concerning the proposal to award aid to
SGS-Thomson for the development of new generations of bipolar, CMOS and combined
technology dedicated circuits

The Commission has sent the Italian Government the designed, developed and prototyped in silicon. The
following letter, informing it that it has decided to application areas are computer and power supply, tele-
terminate proceedings. communications, automotive, audio and radio, and other
advanced applications. The research was stated to be
heavily geared to obtaining competitive products (inte-
‘By letter (registered 20 September 1995), the Italian grated circuits) for immediate industrial production by
authorities, pursuant to Article 93(3) of the Treaty, end-user.
notified proposed State aid to SGS-Thomson for the
development of new generations of bipolar, CMOS and
combined technology dedicated circuits. The legal basis for the proposed aid is the Applied
Research Fund (Italian Laws 46/1982 and 346/1988,
approved by the Commission in 1989). According to the
By letters dated 10 October 1995, 3 January 1996 and 22 Italian authorities, the eligible costs are estimated to be
April 1996, the Commission requested further about ECU 80 million, for a project which comprises
information. By letters (registered 15 December 1995, 27 about 37Ø% for ‘‘industrial research’’ and 63Ø% for
March 1996 and 10 June 1996), a response was received ‘‘precompetitive development activity’’. The proposed
from the Italian authorities. The notification was form of the State aid is a soft loan of ECU 52 million to
therefore completed on 10 June 1996. be repaid over a 10-year period, and granted under
terms more favourable than the prevailing market
conditions. According to the Italian authorities, this
would amount to an aid element of ECU 18 million,
The aim of the research was to design and build in corresponding to a gross grant equivalent aid intensity of
silicon, using specific bipolar, CMOS and combined 22,4Ø%.
technologies, new generations of smart power integrated
circuits geared to applications in a wide variety of
rapidly evolving market segments.
On 17 July 1996, the Commission initiated the
procedure provided for in Article 93(2) of the EC
Treaty. In opening the procedure, the Commission
The project was divided into two subprojects: expressed its serious doubts regarding the necessity for
the aid, the ‘‘incentive’’ effect, and the precompetitive
development nature of the work proposed. In accordance
(a)Ùdesign and development of dedicated integrated with that procedure, the Commission (by letter dated 9
circuits, focusing on circuit features and functional August 1996) invited the Italian Government to submit
characteristics in relation to performance and cost, its observations.

(b) design and technological development of silicon The other Member States and interested parties were
manufacturing processes, the relevant packaging, the informed of the Commission’s decision to initiate
necessary CAE/CAD (computer-aided design and proceedings and invited to submit their observations by
design) tools, and reliability tools and methodo- publication on 27 November 1996 of a notice in the
logies. Official Journal of the European Communities (Î).

Under subproject (a), a total of 58 new integrated
circuits in five different application areas were to be (Î)ÙOJ C 358, 27.11.1996, pp. 3 to 7.
8.8.98 EN Official Journal of the European Communities C 249/15

Following the opening of the procedure, a meeting took By letter dated 21 October 1997, the authorities
place between the Commission services, SGS-Thomson provided supplementary information to which the
representatives and the Italian authorities on 22 Commission responded by letter of 30 October 1997.
November 1996. By letter registered 30 January 1997, Subsequently, authorities by letter dated 5 November
the Italian authorities submitted a formal response. 1997 have withdrawn the notification and communicated
to the Commission that the State aid will not be paid.

A European semiconductor producer also submitted its
observations by letter registered 20 December 1996. Accordingly, the Commission closes the Article 93(2)
These observations were submitted to the authorities (by proceedings in respect of proposed aid to SGS-Thomson
letter dated 29 January 1997) and a response was for the development of new generations of bipolar,
received by letter registered 26 February 1997. CMOS and combined technology dedicated circuits.’