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C 108/2 EN Official Journal of the European Communities 17.4.

1999

STATE AID

Invitation to submit comments pursuant to Article 93(2) of the EC Treaty, concerning the aid
C 81/98 (ex N 421/97) — Italy — measures under Law No 30/98 in favour of the port sector
(1999/C 108/02)

(Text with EEA relevance)

By the letter reproduced below, dated 21 January 1999, the services reminded the Italian authorities that the Commission
Commission notified Italy that it had decided to raise no should be informed of any changes to the notified text. In
objections with regard to certain measures, reserve its January 1998, the Commission was informed that the DL
position with regard to certain other measures under Article had been adopted by the Italian government, and requested a
8 of Law No 30/98 and to initiate the procedure laid down in copy in a note of 14 January 1998 in order to be able to
Article 93(2) of the EC Treaty in respect of the aid provided examine the matter further.
under Article 9 of Law No 30/98.

‘The Commission wishes to inform Italy that, having examined In a letter (No 1677) of 11 March 1998, the Italian authorities
the information supplied by your authorities on the measures submitted a copy of the Law (No 30/98) converting DL No
concerning ports in Law No 30/98 (hereinafter referred to as 457/97 on “urgent provisions for the development of the
“the Law”), it has decided not to raise any objections to the transport sector and for higher employment” of 30 December
measures under Article 8 of the Law as they do not constitute 1997 into law. The Law contained certain modifications with
aid, and to initiate the procedure laid down in Article 93(2) of regard to measures on ports, compared with the text of the
the EC Treaty with regard to the aid envisaged under Article 9 draft DL that had been notified.
of the Law.

I
Due to these amendments, the Commission requested clarifi-
In a letter of the Permanent Representation (reg. No 3554) of cations in a letter of 28 April 1998 to the Italian authorities
27 May 1997, the Italian authorities notified the Commission of about the measures relating to ports in the Law, as some of the
a draft decree-law (hereinafter referred to as “DL”) on information provided for in the letter of 27 November 1997,
“provisions for vessels engaged in international traffic, cited above, was incomplete. In a letter (No 3501) of 28 May
amendments to the shipping code, and provisions governing 1998 and a letter (No 3747) of 10 June 1998, the Italian auth-
the port, maritime and shipping sectors”. As the draft DL orities submitted additional clarifications, inter alia, about the
included provisions concerning shipping on the one hand amounts of aid involved.
and ports and other measures on the other hand, the notifi-
cation was split. The shipping measures (Articles 1 to 23 of the
draft DL) were registered under number N-350/97 and the port
and other provisions (Articles 24 to 29 of the draft DL) under
number N-421/97. This case, N-421/97, only covers the
measures on ports, and is without prejudice to actions taken In a letter of 17 July 1998, Mr Burlando requested the views of
or to be taken by the Commission on other measures. the Commission about a provision in the Law concerning the
municipality of Piombino (explained below) as the matter was
urgent, to which Mr Kinnock replied in a letter of 17
September 1998. Furthermore, at the request of the Italian
authorities, a meeting took place on 24 July 1998 with the
By letter of 1 August 1997, the Commission requested the Commission services to discuss this particular point. Regarding
Italian authorities to provide further information about the the other financial measures on ports included in the Law, the
draft DL and its application to the port sector. By letter (No Commission sent a letter dated 30 July 1998 to the Italian
7989) of 27 November 1997, the Italian authorities provided authorities explaining the outstanding issues on which further
certain, albeit incomplete, information, and reserved the right clarification is needed, as agreed at the above meeting. The
to provide further information later about some provisions on Italian authorities suggested a meeting with the Commission
ports in the draft DL, which were being amended. services, which took place on 23 September 1998, to discuss
these issues in more detail. At this meeting, the Commission
explained the need for further clarification about certain
measures. In a fax of 13 November 1998, the Commission
specifically requested details about a measure concerning infra-
On 11 December 1997, a meeting took place in Brussels with structure in the port of Ancona (described below), to which the
representatives of the Italian authorities where the Commission Italian authorities replied in a fax of 17 November 1998.
17.4.1999 EN Official Journal of the European Communities C 108/3

II has been requested about the amounts to be attributed


to the individual companies and the basis for the allo-
The financial measures involving ports are contained in Article cation, however, until now, no such details have been
8 and Article 9 of the Law, which are described below. provided,

1. Article 8 on “urgent measures for the benefit of the port


sector” of the Law provides:
— ITL 100 000 million to rebalance the accounts provided
for in the budget for the dock work companies and the
careening company in the port of Genoa. Again, the
— financing of the early retirement of 500 employees of assessment of the aid would require details about the
the port authorities in Genoa, Trieste, Venice and Naples amounts granted to the individual companies, and the
according to conditions to be laid down by the Minister basis for the allocation (e.g. the deficits, the reference
of Transport and Shipping, year). The exact justification for covering losses that
apparently derive from periods prior to the privatisation
of the dock work companies in 1995 also remains
— implementation of infrastructure measures in the port of unclear,
Ancona assigned to the competent port authority of
Ancona,

— ITL 120 000 million to the individual ports for dredging


— an amount not exceeding ITL 9 000 million to the purposes. However, despite requests for clarification, the
municipality of Piombino as compensation since the Commission has no details about the beneficiaries of the
municipality did not get a licence to use the land aid, the methods for determining the individual needs of
(belonging to the maritime authorities) on which it the ports or the exact use of the aid (e.g. whether it is
had built a complex referred to as the “CISP” building. intended exclusively for the purchase of dredging
According to an agreement between the maritime auth- equipment).
orities and the Piombino municipal authorities, the
municipality is entitled to compensation if the licence
to use the land is refused in the end,

III
— ITL 20 000 million to the port authority of Genoa as Article 92 of the Treaty provides that “any aid granted by a
compensation for the cessation of port activities and the Member State or through State resources in any form what-
transfer of activities and equipment to other State areas soever which distorts or threatens to distort compentition by
with a view to prepare for the “Colombo 92” exhibition favouring certain undertakings or the production of certain
in the port area. goods shall, in so far as it affects trade between Member
States, be incompatible with the common market”.

2. Article 9 on “measures in the maritime sector” of the Law


provides:
The measures under Article 8 of the Law provide financial
assistance to certain port authorities for redundancies of port
— remuneration to the dock work companies (“compagnie authority employees, to the municipality of Piombino as
et gruppi portuali”) the end-of-service and contractually- compensation for the CISP building, and to the port
agreed allowances which the former have paid to the authority of Genoa as compensation for the “Colombo 92”
workers between 1 February 1990 and 31 December exhibition. Since the financial assistance is provided to the
1996. The amount envisaged is approximately ITL municipality of Piombino, which is a public authority and
36 000 million involving 663 workers, to be allocated not an undertaking, this measure does not constitute State
to each port in proportion to the number of workers. aid within the meaning of Article 92(1) of the EC Treaty.
However, at present no information about the exact However, as regards the financing provided to port authorities,
allocation to each dock work company is available, the Commission does not have sufficient elements to determine
the type of activities these authorities are involved in, notably
whether they participate in any economic activities and,
— ITL 31 680 million for the extension of the salary therefore, reserves its position whether or not such financing
supplement for 1 200 workers and staff in the dock constitutes aid or not. With regard to the specific measure on
work companies and the careening company infrastructure in the port of Ancona also referred to in Article
(“compagnia carenanti”) in the port of Genoa (1). In 8 of the Law, the Italian authorities explained in a letter of 17
order to assess the compatibility of the aid, information November 1998, that access to this infrastructure would be
open to all users. Public financing of port infrastructure is
(1) According to information submitted by the Italian authorities the
not, according to the Commission's current approach,
special reference is due to the fact that this company, unlike the considered as State aid, provided the infrastructure is open to
other dock work companies, has been established as an independent all users on a non-discriminatory basis. Therefore, this measure
consortium. is not considered as an aid under Article 92(1) of the Treaty.
C 108/4 EN Official Journal of the European Communities 17.4.1999

The Article 9 measures, however, provide financial assistance of a service of general economic interest (see ruling of the
to the dock work undertakings, with the exception of the European Court of Justice in Merci Convenzionali del Porto
measure on dredging for which the exact beneficiaries need di Genova v. Gabrielli, case C-179/90 (ECR-I-5923)).
to be identified. These measures are to be financed through
State resources as they impose a burden on the State budget.
Furthermore, they are sector specific as they only favour the
port sector, and also include a further selective element in that,
within the port sector, the measures only confer advantages to In addition, it should be recalled that this case is linked to
the dock work companies. The measures providing to cover another pending case (case C-27/93) concerning aid for the
deficits of the dock work undertakings are of particular restructuring of Italian ports, which the Commission is
concern, as their purpose is to grant relief on costs which examining. To facilitate the restructuring process (to
these undertakings would otherwise have to bear in the transform the ex-monopoly dock work companies into
framework of their normal activities. Such operating aid is private port operators), that was accelerated by the above
generally not allowed (2). Court ruling, several tranches of aid have been granted to
the dock work companies in the past years. To assess the
compatibility of this aid with the common market, the
Commission services have repeatedly requested additional
information, notably an overall, detailed restructuring plan. A
Therefore, these measures are selective as they favour certain financial report concerning five dock work companies in the
undertakings, i.e. the dock work companies, and thus affect the main Italian ports was provided in April 1998, however, the
balance between the recipient undertakings and their report is insufficient, e.g. as it fails to demonstrate the
competitors. Given the intra-Community scope of the port long-term viability of these companies. According to the
sector (port undertakings competing for trade), such public Italian authorities, the envisaged new aid to the dock work
subsidy risks distorting competition and affecting activities in companies in the Law examined under this proceeding, is
ports in other Member States. In the light of the above, the necessary to bring this restructuring process to an end.
measures provided under Article 9 of the Law are to be While this may be the case, without such a comprehensive
considered as State aid within the meaning of Article 92(1) restructuring plan, it is difficult for the Commission to
of the EC Treaty. assess, inter alia, whether the aid meets all the required
conditions, notably the restoration of viability, avoidance of
undue distortions of competition (normally capacity reduction)
and proportionality between the restructuring costs and
State aid is prohibited by Article 92(1) unless the measures can benefits (normally contribution from the beneficiaries' own
benefit from some of the exceptions laid down in the Treaty. resources to the restructuring plan) (3).
On the basis of the information at the disposal of the
Commission, it would appear that the aid foreseen under
Article 9 of the Law is not eligible for any of the exemptions
provided under Article 92(2) or (3) of the EC Treaty, with the Referring to the above, the Commission has serious doubts
exception of Article 92(3)(c). This Article provides that aid about the compatibility of the additional aid envisaged under
which is intended to facilitate the development of certain Article 9 of the Law with the common market, taking into
economic activities or economic areas may be authorised account that previously granted aid to the dock work
provided the aid does not adversely affect trading conditions companies is under examination.
to an extent contrary to the common interest.

IV
However, in the present case, no such development of a special
economic activity or economic area has been demonstrated and In the light of the foregoing considerations, the Commission,
it would appear that the assistance to be granted may have a acting under the procedure laid down in Article 93(2) of the
negative effect on trading conditions to an extent which is not EC Treaty, requests Italy to submit its comments and to furnish
compatible with the common interest. As stated above, while all such informations as may help to evaluate the aid within
the aid seems to favour a particular area of activity, it is one month following the date of receipt of this letter. It
selective within the sector as the only undertakings in the requests your authorities to forward a copy of this letter to
ports to receive aid are the dock work companies who at the potential recipient of the aid immediately.
present (since the abolishing of their monopoly following the
ruling of the European Court of Justice, cited below) competing
with other port (cargo handling) undertakings that do not
benefit from the aid.
The Commission wishes to remind Italy that Article 93(3) of
the EC Treaty has suspensory effect, and would draw your
attention to the letter sent to all Member States on 22
February 1995, stating that all aids granted unlawfully could
Article 90(2) which provides an exemption from the Treaty be recovered from the recipient(s) depending on the relevant
rules on competition is not applicable in this case either as provisions of national law. The amounts thus recovered will
the dock work companies are not entrusted with the operation
(3) According to the Community guidelines on State aid for rescuing
(2) Case T-459/93, Siemens v. Commission, ECR 1995-II, p. 1675. and restructuring firms in difficulty (OJ C 283, 19.9.1997).
17.4.1999 EN Official Journal of the European Communities C 108/5

include interest calculated on the basis of the reference rates The Commission hereby gives notice to interested parties to
used to calculate the grant-equivalent for the purposes of submit their comments on the aid/measures in question within
regional aids, running from the date on which the aid was one month following the date of this notice, to
payable to the recipient(s) until the date of actual recovery.

The Commission warns Italy that it will inform interested European Commission
parties by publishing this letter in the Official Journal of the Directorate-General for Transport
European Communities. It will also inform interested parties in Directorate D
the EFTA countries which are signatories to the EEA Rue de la Loi/Wetstraat 200
Agreement, by publication of a notice in the EEA supplement B-1049 Brussels
to the Official Journal of the European Communities and will Fax (32-2) 295 30 76
inform the EFTA Surveillance Authority by sending a copy of
this letter. All such interested parties will be invited to submit
their comments within one month following the date of such
publication.’ Those comments will be communicated to Italy.

STATE AID
Invitation to submit comments pursuant to Article 93(2) of the EC Treaty, concerning the aid
C 80/98 (ex N 460/98) — Netherlands — Rationalisation of pig assembly centers

(1999/C 108/03)

By the letter reproduced below, dated 3 February 1999, the NLG 20 million will be paid by the Ministry, the remaining
Commission notified the Netherlands that it had decided to NLG 10 million will be paid by the product board for meat and
initiate the procedure under Article 93(2) of the EC Treaty. cattle through a parafiscal tax levied on pigs brought to
assembly centers.
‘The Commission wishes to inform the Netherlands that,
having examined the information supplied by your authorities
on the aid referred to above, it has decided to initiate the
procedure laid down in Article 93(2) of the EC Treaty. C. DURATION

I. PROCEDURE Until 2001 (the measure can be prolonged and payment spread
out over following years if the revenue from the parafiscal tax
In accordance with Article 93(3), the Dutch Permanent Repre- is not sufficient for payment in 2001).
sentation to the European Union notified the Commission of
this draft measure by letter of 6 August 1998, registered on 10
August 1998. Additional information has been provided by
letter of 29 September 1998, registered on 5 October 1998,
D. RECIPIENTS
and by letter of 3 November 1998, registered on 5 November
1998. A meeting took place with representatives of the Dutch Pig assembly centers.
Government on 7 December 1998 where further information
has been provided.

Deadline: 5 January 1999.


E. OBJECT

II. DESCRIPTION The present measure accompanies the tightening-up of the


hygienic regulation imposed upon assembly centers for pigs.
A. TITLE
These new hygienic requirements are necessary to avoid the
Aid for rationalisation of pig assembly centers. spreading of classical swine fever. The amended hygienic regu-
lation partially implements Directive 64/432/EEC, as modified
by Directive 97/12/EC of 17 March 1997 (OJ L 109,
B. BUDGET 25.4.1997), but also contains additional requirements. The
1999: NLG 10 million, hygienic measures have been notified as temporary protection
measures pursuant to Article 10(2) of Directive 90/425/EEC of
2000: NLG 10 million, 26 June 1990 concerning veterinary and zootechnical checks
2001: NLG 10 million. applicable in intra-Community trade in certain live animals and