State Aid

EC: Spanish Shipyards Owe €308.3M

Yesterday the European Commission decided that aid provided to the public Spanish shipyards is not in line with EC rules on State aid to shipbuilding. The Commission has established that State holding company Sociedad Estatal de Participaciones Industriales (SEPI), in 1999 and 2000, granted aid worth €500 million to the civil public shipyards that are today all owned by IZAR. The aid took the form of a capital injection, loans and a purchase price above market value. As the loans amounting to € 192.1 million to SEPI were paid back, the sum to be reimbursed will amount to € 308.3 million, plus interest. The object the decision are a number of transactions that took place between 1999 and 2000 involving SEPI and its subsidiaries Astilleros Españoles (AESA), the former holding company of the public shipyards, and Bazán, the military shipbuilding group. Since the Commission suspected that these transactions might have contained state aid, it opened a formal investigation in July 2000, was extended in November 2001 and extended again in May 2003. Based on the facts that have been established during the formal investigation the Commission concludes that the state holding company SEPI undertook the following transactions, which entailed further state aid to the public Spanish shipyards: An excess purchase price paid by SEPI when AESA sold three shipyards to SEPI in 1999

EC Approves Spanish Yard Restructure

The European Commission has approved, under the terms of the EC Treaty’s rules allowing Member States to take measures to protect essential security interests linked to defence industries (Article 296 of the EC Treaty), a reorganisation of the Spanish public military shipyards. These yards were formerly owned by IZAR but have recently been taken over by a new company called Navantia. The solution allows Spain to protect its essential security interests by rescuing its military shipyards

Rescue Aid for German Shipbuilder Approved by EC

State aid for financial bail-out of P+S Werften temporarily approved by the European Commission The European Commission has authorised under EU state aid rules, a state guarantee backing a rescue loan of €152.4 million for the German shipbuilder P+S Werften in Mecklenburg-Vorpommern. The aid is in line with EU rules on rescue aid because it is limited in time and scope. The Commission approved the measure temporarily

EC Investigation of Proposed French Support of Shipyard

On September 17, The European Commission opened a detailed investigation with a view to examining an aid package which the French Government has put together in support of the Alstom group. At the same time, it found that the conditions are met for adopting an order suspending implementation of and/or payment for the acquisition by the French State of a stake in Alstom and the provision of a subordinated loan. The Commission wishes, however

EU Shipbuilding Aid: New Rules Unveiled

The European Union unveiled new rules for assessing aid to the bloc's shipbuilding sector on Wednesday, hailing the reform as intended to help foster innovation in an industry facing tough global competition, according to a Reuters report. The new rules will go into force from Jan 1 next year and extends the scope of current regulations to inland waterway vessels, floating and moving offshore structures while refining rules on innovation aid.

EU Shipbuilding Aid Extended to 2005

European Union (EU) shipyards will continued to receive government financial aid until March 31, 2005, Reuters reported. The decision extends by one year an arrangement whereby state aid equal to six percent of a contract can be given to EU makers of container ships, chemical and product tankers and Liquefied Natural Gas carriers. The EU has taken South Korea to the World Trade Organisation (WTO), alleging the country is effectively dumping ships on the world market by subsidising its

Statoil Delays Norwegian Barents Sea Project

On account of applicable Norwegian Government tax changes Statoil as operator has recommended a delay of the investment decision for the Johan Castberg project in the Norwegian Barents Sea. Statoil has continued to mature the resource base and development plans for the project. There are still uncertainties related to the resource estimate and investment level. "In addition, the Norwegian government has recently proposed reduced uplift in the petroleum tax system

East Germany Shipyards Seek Quota Break

The prime minister of the German state of Mecklenburg-Western Pomerania asked the European Commission to ease capacity limits imposed on eastern German shipyards as a condition for receiving state aid grants. State premier Harald Ringstorff told EU Competition Commissioner Mario Monti an increase would prevent the yards' improved productivity leading to further job losses. "Any such proposal will be looked at with the utmost care and attention

Commission Authorizes Italian State Aid

The Commission has decided to authorize an Italian aid scheme granting an incentive to shipowners for the elimination of single hull tankers over 20 years of age. Strict conditions regarding the promotion of the use of double tankers have been specified in the aid scheme. The Commission welcomes the objective of the proposed aid, which aims at implementing Community maritime safety legislation and achieving higher safety standards in maritime shipping, prior to it becoming mandatory.

EC Extends Shipbuilding Subsidies to LNG Carriers

The European Commission (EC) has decided to extend the granting of temporary and limited state aids in the shipbuilding sector to liquefied natural gas (LNG) carriers. The action is being taken to offset perceived subsidies by South Korea to its shipyards. EU Trade Commissioner Pascal Lamy said: "Today's decision offers a temporary relief to European LNG shipyards which are facing serious difficulties, while Korea continues to price ships below cost