EU Approves State Aid to Modernize German Shipyard
The European Commission said it has approved a $5.5m regional investment aid package for the German shipyard Volkswerft Stralsund. The commission said the investment will enable the yard to build larger ships at competitive costs, thereby increasing the productivity of the yard without creating a result in a disproportionate capacity increase. The total investment will be $24.8m, with $5.5m paid as state aid, corresponding to 22.5 pct -- the maximum aid intensity allowed under the Framework on State aid to Shipbuilding. Germany said it would provide aid to Volkswerft Stralsund, situated on the Baltic coast in Mecklenburg-Vorpommern, in August 2005. The region has a standard of living is below the EU average and serious unemployment.
EU Ports Stress on Open Investment Environment
European Commission published a Proposal for a Regulation establishing a framework for screening of foreign direct investments into the European Union and a Communication entitled “Welcoming foreign direct Investment while Protecting Essential Interests” on 13 September 2017. The European Sea Ports Organisation (ESPO) welcomes the fact that the Commission proposal is stressing the importance of an open investment environment. The port sector is capital intensive. Over the last decades ports in Europe have benefitted from substantial investment from outside the European Union…
EU Softens Rules on Ports Investments
European Commission has exempted public support measures in a number of areas from prior Commission state aid control, said a press statement. This facilitates public investments in key infrastructure, namely ports and existing airports, but also public support for culture, multi-purpose sport arenas and the EU's outermost regions. EU State aid rules ensure that companies can compete on equal terms in the EU Single Market to the benefit of European consumers. The EU Treaty gives the Commission the task of enforcing those rules.
French, Spanish Funds for Motorways of the Sea
The European Commission gave its green light for the public financing from France and Spain to the Fres Mos project. It will link the French port of Nantes-Saint Nazaire with the Spanish port of Gijon, and will be operated by GLD Atlantique. This Motorways of the Sea project will also receive an EU grant in the framework of the 2009 Marco Polo II call for proposals, in which the Commission selected twenty-two projects with overall funding of $92.3m. With these projects, the Commission expects to shift a total of 16.8 billion tonne/kilometres of freight away from the roads. The EU Marco Polo II program selects each year a range of projects that aim to shift freight from the road onto more environmentally-friendly transport modes, such as railway, inland waterway and maritime transport.
Polish Shipyard Aid Under Scrutiny
The European Commission has decided to open formal inquiries into public support for three shipyards in Gdynia, Gdañsk and Szczecin. The restructuring aid granted to these yards will be scrutinised in the light of EC Treaty rules on state aid, and in particular the rules on state aid to companies in difficulties, in so far as it has been granted after the accession of Poland to the European Union on May 1 2004. The Commission will not examine several measures granted by the Polish authorities before accession. “The type of aid proposed by the Polish authorities is only compatible with EU rules if accompanied by a detailed restructuring plan involving durable industrial restructuring and not limited to servicing debt and improving liquidity.
Gdansk Faces Closure
Gdansk shipyard will have to be scaled back or face possible closure as Brussels turns the screw on illegal state aid to the Polish shipbuilding sector. Neelie Kroes, the European Union competition commissioner, has given the Polish authorities one month to reduce capacity at the yard or face having to repay the state aid. Ms Kroes on Friday accepted capacity cuts at Poland's Gdynia and Szczecin yards in return for past state aid but said no satisfactory solution had been proposed for Gdansk. The three shipyards have together received 1.8bn in subsidies since Poland joined the European Union in 2004. In Ms Kroes's eyes, that gives the yards an unfair advantage over European competitors. The Commission is pushing for Gdansk to reduce its capacity and to cut its three slipways to one.
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)…
Moore Stephens calls for EU tonnage tax stability
International accountant and shipping adviser Moore Stephens has called for stability for European tonnage tax regimes now that the EC has begun its review of EU State Aid Guidelines to Maritime Transport. The start of the EC’s review of the EU State Aid Guidelines to Maritime Transport was announced on 14 February 2012. These guidelines cover European tonnage tax regimes as well as other state aid to the maritime sector. The EC has published a detailed and very comprehensive questionnaire regarding these state aid guidelines…
Kvaerner Appeals EC State Aid Ruling
Kvaerner has appealed against a European Commission ruling that it must repay state aid of $44.8 million for alleged over-production at its Warnow shipyard in Germany during 1998. Kvaerner took a provision of $32.4 million - compared to the $43.5 million the Commission is seeking - in the second quarter. Company officials maintain that Kvaerner complied with a technical capacity limit imposed when the yard was acquired in 1992, and was within its rights to boost actual output due to productivity gains.
Kvaerner Appeals EC Ruling On State Aid Repayment
Kvaerner has reportedly appealed against a European Commission ruling that it must repay state aid of $44.8 million for alleged over-production at its Warnow shipyard in Germany during 1998. Kvaerner officials maintain that the company complied with a technical capacity limit imposed when the yard was acquired in 1992, and was within its rights to boost actual output due to productivity gains.
State Aid to Saremar Ruled Illegal
After an in-depth investigation, the European Commission has concluded that part of the support measures that Sardinia had granted to the maritime company Saremar in 2011 and 2012 was incompatible with EU state aid rules. In particular, a capital injection not approved on market conditions and the compensation for carrying out certain maritime services have provided an undue economic advantage to Saremar that its competitors did not have. Saremar needs to pay back this undue advantage of around €10.8 million in total, to remedy the distortion of competition this has created. At the same time the Commission concluded that two letters of comfort issued by the Region did not guarantee any financial obligation of the company and did not therefore constitute State aid to Saremar.
Spain Contests Decision On Shipyard Aid
The Spanish government said last week that it would appeal a European Commission decision ordering Spain's state-owned shipyards to repay with interest $118 million in state aid. "The industry ministry and the government is absolutely convinced that this aid for shipbuilders is correct," Industry Secretary Jose Manuel Serra said. He said the payments, made in 1998, were within a $370.6 million aid plan authorized by Brussels. Shipyard workers staged a one-day strike at yards across Spain in protest at Tuesday's ruling by the commission. Unions called for a change in European legislation on the industry. Serra said conditions in which European shipyards compete with companies from other regions.
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, while ensuring that there will be no undue distortion of competition in the market for civil shipbuilding and ship repair. The solution also takes account, to the greatest possible extent, of the social and regional problems involved in this case.
Rescue Aid for German Shipbuilder Approved by EC
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, until it can take a position on the restructuring plan to be submitted by Germany within maximum six months. The Commission authorised a short-term measure to tackle liquidity problems and enable P+S Werften to pay creditors and properly maintain production pending the implementation of a restructuring plan. P+S Werften GmbH was created in 2010 through the merger of the two long-established German shipbuilding companies Volkswerft Stralsund GmbH and Peene Werft GmbH.
European Commission – Shipyard Aid
The European Commission has concluded, following four years of investigation, that state aid granted to Gdynia shipyard and Szczecin shipyard gives rise to disproportionate distortions of competition within the Single Market, in breach of EC Treaty state aid rules, and must be repaid. The Commission has simultaneously agreed to accept commitments from Poland for the implementation of the decisions in a way that will quickly create opportunities for viable and sustainable economic activities at the Gdynia and Szczecin sites and so maximize the number of sustainable jobs there. In particular, the Polish authorities have committed to sell the yards' assets through open…
EC Warns Greece on Tonnage Tax
The European Commission has sent to Greece a set of proposals to ensure that state support to the maritime sector in Greece complies with EU state aid rules. In particular, the Commission found that current provisions may breach EU state aid rules by allowing shareholders of shipping companies to benefit from favourable tax treatment that should be reserved for maritime transport providers. Similarly, the Commission is concerned that favourable tax treatment is also extended to maritime sector intermediaries and operators of ships, which do not provide maritime transport services.
French Ferry Firm Loses State Aid Appeal
Cash-strapped ferry operator SNCM looks set to seek legal protection from its creditors after Europe's highest court ruled on Thursday it must pay back 220 million euros ($289 million) of French state aid. SNCM, owned 66 percent by transport group Transdev, has racked up losses as low-cost competitors have eaten away its market share and is fast running out of funds. Transdev - itself a joint venture between water and waste firm Veolia and French state bank CDC - has said it will…
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, to continue its dialogue with France and will thus give it one last chance before issuing the order. It has authorised Commissioner Monti, in agreement with the Commission's President, to adopt and implement the suspension order by 22 September unless the French authorities undertake publicly not to take any steps involving…
EU Court Strikes Down Spanish Ship Finance Scheme
Court says scheme does not give firms selective advantage; EU regulators cracking down on unfair tax systems. Europe's second-highest court gave clearance on Thursday to a Spanish tax lease scheme in the shipbuilding industry, annulling a decision by EU regulators two years ago that this gave a selective advantage to companies and so was illegal state aid. The ruling by the Luxembourg-based General Court underlines the hurdles facing the European Commission in its crackdown on corporate tax avoidance and national programmes that benefit only certain groups. The Spanish scheme involved financing ship construction through a structure with two intermediaries, and allowing shipping companies to get a rebate of 20 to 30 percent on the price of vessels built by Spanish shipyards.
EU Investigating Antwerp Box Port Operators
The European Commission said on Friday it had opened an in-depth investigation into alleged state aid to two container terminal operators in Europe's second busiest port, Antwerp in Belgium. The Commission said concession agreements for PSA Antwerp NV and Antwerp Gateway NV contained a requirement for the handling of a minimum tonnage. The two did not reach this between 2009 and 2012, meaning they would have to pay compensation to the publicly-owned port authority. However, the Antwerp Port Authority decided in 2013 to reduce the minimum tonnage retroactively…
EC Approves Aid for Finland's First LNG Terminal
The European Commission has approved under EU state aid rules Finland's plans to grant €23 million to construct a small scale LNG terminal at Pori on Finland's west coast. The European Commission has concluded that Finland's plans to grant €23 million of public funding for the construction of a small scale LNG terminal at Pori, in the Satakunta region on Finland's west coast, are compatible with EU state aid rules. The project aims to encourage the use of LNG as fuel for ships, in place of fuel oils and liquefied petroleum gases.
EC To Investigate Spanish Payments
The European Commission will open a formal investigation into plans by Spanish state holding company SEPI to pay $57 million (10 billion pesetas) to buy a number of shipyards as part of a restructuring plan. "On the basis of the information at its disposal the Commission doubts whether this was a genuine market transaction, but rather a capital injection that could constitute state aid," the Commission said in a statement. The Commission noted it had already cleared an aid package for the Juliana and Cadiz shipyards in 1997 on condition they received no further state handouts.
EC Extends State Aid for Shipbuilding
The European Commission has prolonged the Framework on state aid rules for shipbuilding for three more years, until 31 December 2011. This extension follows an earlier extension in 2006 (see IP/06/1452). The Commission has concluded that the Framework, which came into effect on 1 January 2004 (see IP/03/1607) has been applied without any problems and does not need to be revised at this stage. The Framework's main principle is that horizontal state aid rules apply to shipbuilding except where specific provisions apply that reflect the specific characteristics of the shipbuilding industry and market. The specific provisions contained in the Framework concern regional aid, closure aid, export credits, development aid, employment aid and aid for research, development and innovation.