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I Informácie

Komisia

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Výmenný kurz eura (1)

20. decembra 2006

(2006/C 314/01)

1 euro= 

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(1)

Zdroj: referenčný výmenný kurz publikovaný ECB.

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Oznámenie o začatí antidumpingového konania týkajúceho sa dovozu určitých kompresorov s pôvodom v Čínskej ľudovej republike

(2006/C 314/02)

V súlade s článkom 5 nariadenia Rady (ES) č. 384/96 o ochrane pred dumpingovými dovozmi z krajín, ktoré nie sú členmi Európskeho spoločenstva (ďalej len „základné nariadenie“) (1) bol Komisii predložený podnet, v ktorom sa uvádza, že dovoz určitých kompresorov s pôvodom v Čínskej ľudovej republike (ďalej len „príslušná krajina“) je dumpingový, a tým spôsobuje značnú ujmu výrobnému odvetviu Spoločenstva.

1.   Podnet

Podnet predložila Federazione ANIMA/COMPO (ďalej len „navrhovateľ“) 20. novembra 2006 v mene výrobcov, ktorí predstavujú významnú časť, v tomto prípade viac než 50 % celkovej výroby určitých kompresorov v Spoločenstve.

2.   Výrobok

Výrobkom, ktorý je údajne predmetom dumpingu, sú vratné kompresory, vrátane čerpadiel vratných kompresorov, s prietokom nepresahujúcim 2 kubické metre (m3) za minútu s pôvodom v Čínskej ľudovej republike (ďalej len „príslušná krajina“), bežne zaradené pod kódy KN ex 8414 40 10, 8414 80 22, ex 8414 80 28 a ex 8414 80 51. Tieto kódy KN sa uvádzajú iba pre informáciu.

3.   Tvrdenie o dumpingu

Vzhľadom na ustanovenia článku 2 ods. 7 základného nariadenia navrhovateľ stanovil pre Čínsku ľudovú republiku normálnu hodnotu na základe ceny v krajine s trhovým hospodárstvom, ktorá sa uvádza v odseku 5.1 písm. d). Tvrdenie o dumpingu je založené na porovnaní takto vypočítanej normálnej ceny s vývoznými cenami príslušného výrobku pri predaji určenom na vývoz do Spoločenstva.

Na základe toho je vypočítané dumpingové rozpätie značné.

4.   Tvrdenie o ujme

Navrhovateľ poskytol dôkazy o tom, že dovoz príslušného výrobku z Čínskej ľudovej republiky sa celkovo zvýšil v absolútnom vyjadrení a z hľadiska podielu na trhu.

Tvrdí sa, že objemy a ceny dovezeného príslušného výrobku, okrem iného, negatívne ovplyvnili podiel na trhu, predané množstvá a úroveň cien účtovaných výrobným odvetvím Spoločenstva, čo malo výrazné nepriaznivé účinky na celkovú výkonnosť a finančnú situáciu výrobného odvetvia Spoločenstva.

5.   Postup

Keďže Komisia po porade s poradným výborom stanovila, že podnet bol predložený výrobným odvetvím Spoločenstva alebo v jeho mene, a že existujú dostatočné dôkazy na odôvodnenie začatia konania, Komisia týmto začína prešetrovanie podľa článku 5 základného nariadenia.

5.1.   Postup stanovenia dumpingu a ujmy

Na základe prešetrovania sa stanoví, či je príslušný výrobok s pôvodom v Čínskej ľudovej republike dovážaný za dumpingové ceny a či tento dumping spôsobil ujmu.

a)   Výber vzorky

Vzhľadom na zjavne veľký počet zainteresovaných strán v tomto konaní môže Komisia rozhodnúť o uplatnení výberu vzorky v súlade s článkom 17 základného nariadenia.

i)   Výber vzorky vývozcov/výrobcov v Čínskej ľudovej republike

S cieľom umožniť Komisii, aby rozhodla o potrebe výberu vzorky a v kladnom prípade k nemu pristúpila, sa týmto vyzývajú všetci vývozcovia/výrobcovia alebo zástupcovia konajúci v ich mene, aby sa Komisii prihlásili a poskytli ďalej uvedené informácie o svojej spoločnosti alebo spoločnostiach v rámci lehoty stanovenej v odseku 6 písm. b) bode i) a vo forme uvedenej v odseku 7:

Komisia s cieľom získať informácie, ktoré považuje za nevyhnutné na výber vzorky vývozcov/výrobcov, osloví navyše orgány Čínskej ľudovej republiky a akékoľvek známe združenia vývozcov/výrobcov.

ii)   Výber vzorky dovozcov

S cieľom umožniť Komisii, aby rozhodla o potrebe výberu vzorky a v kladnom prípade k nemu pristúpila, sa týmto vyzývajú všetci dovozcovia alebo zástupcovia konajúci v ich mene, aby sa Komisii prihlásili a poskytli ďalej uvedené informácie o svojej spoločnosti alebo spoločnostiach v rámci lehoty stanovenej v ods. 6 písm. b) bode i) a vo forme uvedenej v odseku 7:

Okrem toho Komisia osloví aj všetky známe združenia dovozcov v záujme získať informácie, ktoré považuje na výber vzorky dovozcov za potrebné.

iii)   Výber vzorky výrobcov Spoločenstva

Vzhľadom na veľký počet výrobcov Spoločenstva podporujúcich podnet má Komisia v úmysle prešetriť ujmu spôsobenú výrobnému odvetviu Spoločenstva prostredníctvom výberu vzorky.

S cieľom umožniť Komisii vybrať vzorku sa týmto všetci výrobcovia v Spoločenstve vyzývajú, aby v lehote stanovenej v odseku 6 písm. b) bode i) poskytli tieto informácie o svojej spoločnosti alebo spoločnostiach vo forme uvedenej v odseku 7:

iv)   Konečný výber vzoriek

Všetky zainteresované strany, ktoré chcú predložiť akékoľvek relevantné informácie týkajúce sa výberu vzorky, musia tak urobiť v lehote stanovenej v odseku 6 písm. b) bode ii).

Komisia má v úmysle urobiť konečný výber vzoriek po porade so zainteresovanými stranami, ktoré prejavili záujem byť do vzorky začlenené.

Spoločnosti začlenené do vzorky musia vyplniť dotazník v rámci lehoty stanovenej v odseku 6 písm. b) bode iii) a musia v rámci prešetrovania spolupracovať.

V prípade nedostatočnej spolupráce môže Komisia v súlade s článkom 17 ods. 4 a článkom 18 základného nariadenia založiť svoje zistenia na dostupných skutočnostiach. Zistenie, ktoré je založené na dostupných skutočnostiach, môže byť pre príslušnú stranu menej výhodné, ako je vysvetlené v odseku 8.

b)   Dotazníky

S cieľom získať informácie, ktoré považuje za potrebné pre svoje prešetrovanie, Komisia zašle dotazníky predstaviteľom výrobného odvetvia Spoločenstva zaradeným do vzorky a každému združeniu výrobcov v Spoločenstve, vývozcom/výrobcom v Čínskej ľudovej republike zaradeným do vzorky, každému združeniu vývozcov/výrobcov, dovozcom zaradeným do vzorky, každému združeniu dovozcov uvedenému v podnete a orgánom príslušnej vyvážajúcej krajiny.

Vývozcovia/výrobcovia v Čínskej ľudovej republike požadujúci individuálne rozpätie, s cieľom uplatniť článok 17 ods. 3 a článok 9 ods. 6 základného nariadenia, musia predložiť vyplnený dotazník v lehote stanovenej v odseku 6 písm. a) bode ii) tohto oznámenia. Musia preto o dotazník požiadať v rámci lehoty stanovenej v odseku 6 písm. a) bode i). Takéto strany by si však mali byť vedomé skutočnosti, že ak sa uplatní výber vzorky v prípade vývozcov/výrobcov, Komisia môže predsa len rozhodnúť, že pre ne nevypočíta individuálne rozpätie, ak by bol počet vývozcov/výrobcov taký veľký, že individuálne prešetrovanie by bolo nadmieru zložité a prekážalo by včasnému ukončeniu prešetrovania.

c)   Zber informácií a vypočutia

Všetky zainteresované strany sa týmto vyzývajú, aby oznámili svoje stanoviská, predložili informácie iné ako vo vyplnených dotazníkoch, a poskytli podporné dôkazy. Tieto informácie musia byť spolu s podpornými dôkazmi doručené Komisii v rámci lehoty stanovenej v odseku 6 písm. a) bode ii).

Komisia môže okrem toho vypočuť zainteresované strany, pokiaľ predložia žiadosť, ktorou sa preukáže, že existujú osobitné dôvody, pre ktoré by mali byť vypočuté. Táto žiadosť sa musí predložiť v rámci lehoty stanovenej v odseku 6 písm. a) bode iii).

d)   Výber krajiny s trhovým hospodárstvom

V súlade s článkom 2 ods. 7 písm. a) základného nariadenia sa na stanovenie normálnej hodnoty, pokiaľ ide o Čínsku ľudovú republiku, uvažuje o výbere Brazílie, ako o vhodnej krajine s trhovým hospodárstvom. Zainteresované strany sa týmto vyzývajú, aby sa vyjadrili k vhodnosti tohto výberu v osobitnej lehote stanovenej v odseku 6 písm. c).

e)   Štatút trhového hospodárstva

V prípade tých vývozcov/výrobcov v Čínskej ľudovej republike, ktorí tvrdia, že svoju činnosť vykonávajú v súlade s podmienkami trhového hospodárstva, t. j. že spĺňajú kritériá stanovené v článku 2 ods. 7 písm. c) základného nariadenia, a poskytnú o tom dostatočné dôkazy, sa normálna hodnota stanoví v súlade s článkom 2 ods. 7 písm. b) základného nariadenia. Vývozcovia/výrobcovia, ktorí majú v úmysle predložiť náležite odôvodnené žiadosti, musia tak urobiť v osobitnej lehote stanovenej v odseku 6 písm. d). Komisia zašle formuláre žiadostí všetkým vývozcom/výrobcom v Čínskej ľudovej republike uvedeným v podnete a každému združeniu vývozcov/výrobcov uvedenému v podnete, ako aj orgánom Čínskej ľudovej republiky.

5.2.   Postup zhodnotenia záujmu Spoločenstva

V súlade s článkom 21 základného nariadenia a v prípade, že sú tvrdenia o dumpingu a ním spôsobenej ujme opodstatnené, sa rozhodne o tom, či by prijatie antidumpingových opatrení nebolo v rozpore so záujmom Spoločenstva. Z tohto dôvodu výrobné odvetvie Spoločenstva, dovozcovia, ich zastupujúce združenia, zástupcovia používateľov a organizácie zastupujúce spotrebiteľov, pokiaľ dokážu, že medzi ich činnosťou a príslušným výrobkom existuje objektívne prepojenie, môžu sa v rámci všeobecných lehôt stanovených v odseku 6 písm. a) bode ii) prihlásiť a poskytnúť Komisii informácie. Strany, ktoré konali v súlade s predchádzajúcou vetou, môžu v lehote stanovenej v odseku 6 písm. a) bode iii) požiadať o vypočutie, pričom uvedú osobitné dôvody, pre ktoré by mali byť vypočuté. Je potrebné poznamenať, že akékoľvek informácie predložené podľa článku 21 sa zohľadnia len v tom prípade, ak budú v čase ich predloženia podložené konkrétnymi dôkazmi.

6.   Lehoty

a)   Všeobecné lehoty

i)   Pre strany na vyžiadanie dotazníka alebo iných formulárov žiadostí

Všetky zainteresované strany by mali požiadať o dotazník alebo iné formuláre žiadostí čo najskôr, najneskôr však do 10 dní od uverejnenia tohto oznámenia v Úradnom vestníku Európskej únie.

ii)   Pre strany na prihlásenie, na predloženie vyplnených dotazníkov a akýchkoľvek iných informácií

Všetky zainteresované strany, ak majú byť ich vyjadrenia počas prešetrovania zohľadnené, sa musia prihlásiť Komisii, oznámiť svoje stanoviská a predložiť vyplnené dotazníky alebo akékoľvek iné informácie do 40 dní od dátumu uverejnenia tohto oznámenia v Úradnom vestníku Európskej únie, ak nie je uvedené inak. Je potrebné poukázať na skutočnosť, že vykonávanie väčšiny procesných práv stanovených v základnom nariadení závisí od toho, či sa strana prihlási v rámci uvedeného obdobia.

Spoločnosti začlenené do vzorky musia predložiť vyplnené dotazníky v lehotách uvedených v odseku 6 písm. b) bode iii).

iii)   Vypočutia

V rámci tej istej 40-dňovej lehoty môžu všetky zainteresované strany takisto požiadať o vypočutie Komisiou.

b)   Osobitná lehota týkajúca sa výberu vzorky

c)   Osobitná lehota na výber krajiny s trhovým hospodárstvom

Strany zúčastňujúce sa na prešetrovaní môžu prejaviť záujem o vyjadrenie pripomienok o vhodnosti výberu Brazílie, o ktorej sa, ako je uvedené v odseku 5.1 písm. d), uvažuje ako o krajine s trhovým hospodárstvom na účely stanovenia normálnej hodnoty, pokiaľ ide o Čínsku ľudovú republiku. Tieto pripomienky musí Komisia dostať do 10 dní odo dňa uverejnenia tohto oznámenia v Úradnom vestníku Európskej únie.

d)   Osobitná lehota na predloženie žiadostí o štatút trhového hospodárstva a/alebo o individuálny prístup

Riadne odôvodnené žiadosti o štatút trhového hospodárstva (ako je uvedené v odseku 5.1 písm. e)) a/alebo o individuálny prístup v súlade s článkom 9 ods. 5 základného nariadenia musia byť Komisii doručené do 15 dní od dátumu uverejnenia tohto oznámenia v Úradnom vestníku Európskej únie.

7.   Písomné podania, vyplnené dotazníky a korešpondencia

Všetky podania a žiadosti predložené zainteresovanými stranami musia byť realizované písomne (nie v elektronickej forme, ak nie je uvedené inak) a musia uvádzať názov, adresu, e-mailovú adresu, telefónne číslo a faxové číslo zainteresovanej strany. Všetky písomné podania, vrátane informácií požadovaných v tomto oznámení, vyplnených dotazníkov a korešpondencie, ktoré zainteresované strany poskytnú ako dôverné, sa označia ako „Limited (4)“ a v súlade s článkom 19 ods. 2 základného nariadenia sa k nim pripojí znenie, ktoré nemá dôverný charakter, s označením „For inspection by interested parties“.

Adresa Komisie na účely korešpondencie:

8.   Nespolupráca

V prípadoch, keď ktorákoľvek zainteresovaná strana odmietne sprístupniť alebo neposkytne potrebné informácie v rámci lehôt alebo významnou mierou prekáža v prešetrovaní, môžu sa v súlade s článkom 18 základného nariadenia vypracovať pozitívne, príp. negatívne dočasné alebo konečné zistenia na základe dostupných skutočností.

Ak sa zistí, že ktorákoľvek zainteresovaná strana poskytla nepravdivé alebo zavádzajúce informácie, tieto informácie sa nezohľadnia a použijú sa dostupné skutočnosti. Ak zainteresovaná strana nespolupracuje alebo spolupracuje iba čiastočne a zistenia sa preto zakladajú na dostupných skutočnostiach v súlade s článkom 18 základného nariadenia, môže byť výsledok pre túto stranu menej priaznivý než v prípade, keby bola spolupracovala.

9.   Časový plán prešetrovania

Podľa článku 6 ods. 9 základného nariadenia sa prešetrovanie ukončí do 15 mesiacov odo dňa uverejnenia tohto oznámenia v Úradnom vestníku Európskej únie. V súlade s článkom 7 ods. 1 základného nariadenia možno uložiť predbežné opatrenia najneskôr do 9 mesiacov od uverejnenia tohto oznámenia v Úradnom vestníku Európskej únie.

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(1)Ú. v. ES L 56, 6.3.1996, s. 1. Nariadenie naposledy zmenené a doplnené nariadením Rady (ES) č. 2117/2005 (Ú. v. EÚ L 340, 23.12.2005, s. 17).

(2)  Individuálne rozpätie možno požadovať v súlade s článkom 17 ods. 3 základného nariadenia v prípade spoločností, ktoré nie sú začlenené do vzorky, článkom 9 ods. 5 základného nariadenia týkajúceho sa individuálneho prístupu v prípade krajín s iným ako trhovým hospodárstvom/transformujúcim sa hospodárstvom a článkom 2 ods. 7 písm. b) základného nariadenia v prípade spoločností, ktoré požadujú štatút trhového hospodárstva. Treba poznamenať, že žiadosti o individuálne zaobchádzanie si vyžadujú prihlášku v súlade s článkom 9 ods. 5 základného nariadenia a žiadosti týkajúce sa štatútu trhového hospodárstva prihlášku v súlade s článkom 2 ods. 7 písm. b) základného nariadenia.

(3)  Usmernenie o význame pojmu „prepojené spoločnosti“ možno nájsť v článku 143 nariadenia Komisie (EHS) č. 2454/93, ktorým sa vykonáva nariadenie Rady (EHS) č. 2913/92, ktorým sa ustanovuje Colný kódex Spoločenstva (Ú. v. ES L 253, 11.10.1993, s. 1).

(4)  Toto označenie znamená, že ide o interný dokument. Je chránený podľa článku 4 nariadenia Európskeho parlamentu a Rady (ES) č. 1049/2001 o prístupe verejnosti k dokumentom Európskeho parlamentu, Rady a Komisie (Ú. v. ES L 145, 31.5.2001, s. 43). Ide o dôverný dokument podľa článku 19 základného nariadenia a článku 6 Dohody Svetovej obchodnej organizácie (WTO) o implementácii článku VI Všeobecnej dohody o clách a obchode (GATT) z roku 1994 (antidumpingová dohoda).

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Povolenie štátnej pomoci v rámci ustanovení článkov 87 a 88 Zmluvy o ES

Prípady, ku ktorým nemá Komisia námietky

(Text s významom pre EHP)

(2006/C 314/03)

Rozhodnutie v autentickom jazykovom znení, z ktorého boli odstránené všetky informácie, ktoré sú predmetom obchodného tajomstva, je uverejnené na stránke:

http://ec.europa.eu/community_law/state_aids/

Rozhodnutie v autentickom jazykovom znení, z ktorého boli odstránené všetky informácie, ktoré sú predmetom obchodného tajomstva, je uverejnené na stránke:

http://ec.europa.eu/community_law/state_aids/

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Oznámenie Komisie k implementácii smernice Rady č. 1999/5/ES

(Text s významom pre EHP)

Publikovanie názvov a označení harmonizovaných noriem k smernici

(2006/C 314/04)

Príklad: Pre EN 60215:1989 platí:

POZNÁMKA:

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(1)

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Oznámenie Komisie v rámci implementácie smernice Rady z 3. mája 1989 o aproximácii právnych predpisov členských štátov, týkajúcich sa elektromagnetickej compatibility (89/336/EHS)

(Text s významom pre EHP)

Publikovanie názvov a označení harmonizovaných noriem k smernici

(2006/C 314/05)

Všeobecná poznámka: ak sa v stĺpci 3 (odkaz na nahradenú normu) nachádza lomka, znamená to, že príslušná norma sa nesmie na účely EMC použiť bez zmeny alebo bez príslušnej časti.

Príklad: Pre EN 61037:1992 platí:

POZNÁMKA:

Tento zoznam nahrádza všetky predchádzajúce zoznamy uverejnené Úradnom vestníku Európskej únie.

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(1)

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Oznámenie Komisie v rámci implementácie smernice Rady z 21. decembra 1989 o aproximácii právnych predpisov členských štátov, týkajúcich sa osobných ochranných prostriedkov (89/686/EHS)

(Text s významom pre EHP)

(Uverejnenie názvov a odkazov harmonizovaných noriem podľa smernice)

(2006/C 314/06)

POZNÁMKA:

Viac informácií o harmonizovaných normách nájdete na internetovej adrese:

http://europa.eu.int/comm/enterprise/newapproach/standardization/harmstds

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(1)  ESO: Európske organizácie pre normalizáciu:

(2)Ú. v. ES L 204, 21.7.1998, s. 37.

(3)Ú. v. ES L 217, 5.8.1998, s. 18.

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Informácie oznámené členskými štátmi o štátnej pomoci poskytnutej v súlade s nariadením Komisie (ES) č. 70/2001 z 12. januára 2001 o uplatňovaní článkov 87 a 88 Zmluvy o ES na štátnu pomoc malým a stredným podnikom

(Text s významom pre EHP)

(2006/C 314/07)

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(1)  Výška pomoci poskytnutej spoločnosti vyjadrená v ekvivalente hrubej hotovostnej finančnej pomoci.

(2)  Po revízii nariadenia č. 70/2001 bude opatrenie v prípade potreby zosúladené s príslušnými ustanoveniami a Komisia bude následne informovaná.

(3)   Po revízii nariadenia č. 70/2001 bude opatrenie v prípade potreby zosúladené s príslušnými ustanoveniami a Komisia bude následne informovaná.

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Oznámenie o začatí antidumpingového konania týkajúceho sa dovozu oxidov mangánu s pôvodom v Juhoafrickej republike

(2006/C 314/08)

V súlade s článkom 5 nariadenia Rady (ES) č. 384/96 o ochrane pred dumpingovými dovozmi z krajín, ktoré nie sú členmi Európskeho spoločenstva (ďalej len „základné nariadenie“) (1), naposledy zmeneného a doplneného nariadením (ES) č. 2117/2005 (2), bol Komisii predložený podnet, v ktorom sa uvádza, že dovoz určitých oxidov mangánu s pôvodom v Juhoafrickej republike (ďalej len „príslušná krajina“) je dumpingový, a tým spôsobuje značnú ujmu výrobnému odvetviu Spoločenstva.

1.   Podnet

Podnet v mene výrobcov, ktorých produkcia predstavuje podstatnú časť celkovej výroby určitých oxidov mangánu v Spoločenstve, v tomto prípade viac než 25 %, podala 10. novembra 2006 spoločnosť Tosoh Hellas AIC (ďalej len „navrhovateľ“).

2.   Výrobok

Výrobkom údajne predávaným za dumpingové ceny sú určité elektrolytické oxidy mangánu -(oxidy mangánu s vysokou čistotou vyrábané elektrolytickým procesom), ktoré neboli tepelne ošetrené, čo je bežnou praxou, aby sa mohli použiť v lítiových batériách, s pôvodom v Juhoafrickej republike (ďalej len „príslušný výrobok“), zvyčajne uvádzaný pod kódom KN ex-2820 10 00. Tento kód KN sa uvádza iba pre informáciu.

3.   Tvrdenie o dumpingu

Tvrdenie o dumpingu v prípade Juhoafrickej republiky je z dôvodu absencie dostatočného predaja na domácom trhu založené na porovnaní vytvorenej normálnej hodnoty s vývoznými cenami príslušného výrobku pri predaji na vývoz do Spoločenstva.

Na základe toho je vypočítané dumpingové rozpätie značné.

4.   Tvrdenie o ujme

Navrhovateľ poskytol dôkazy, podľa ktorých sa dovoz príslušného výrobku z Juhoafrickej republiky celkovo zvýšil v absolútnom vyjadrení a z hľadiska podielu na trhu.

V podnete sa tvrdí, že množstvo a ceny príslušného dovážaného výrobku majú okrem iného negatívny vplyv na cenovú hladinu, za ktorú predáva výrobné odvetvie Spoločenstva, čo má za následok závažné nepriaznivé účinky na finančný situácia výrobného odvetvia Spoločenstva.

5.   Postup

Keďže Komisia po porade s poradným výborom stanovila, že podnet bol predložený výrobným odvetvím Spoločenstva alebo v jeho mene, a že existujú dostatočné dôkazy na odôvodnenie začatia konania, začína týmto prešetrovanie podľa článku 5 základného nariadenia.

5.1.   Postup stanovenia dumpingu a ujmy

Na základe prešetrovania sa stanoví, či je príslušný výrobok s pôvodom v Juhoafrickej republike dovážaný za dumpingové ceny a či tento dumping spôsobuje ujmu.

a)   Dotazníky

Komisia v záujme získania informácií, ktoré považuje za nevyhnutné na prešetrovanie, rozošle dotazníky predstaviteľom výrobného odvetvia Spoločenstva a všetkým združeniam výrobcov v Spoločenstve, vývozcom/výrobcom v Juhoafrickej republike, všetkým združeniam vývozcov/výrobcov, dovozcom, všetkým združeniam dovozcov uvedeným v podnete a orgánom príslušných vyvážajúcich krajín.

V každom prípade by však všetky strany mali bezodkladne kontaktovať Komisiu faxom, najneskôr však v lehote stanovenej v ods. 6 písm. a), s cieľom zistiť, či sú v podnete uvedené, a v prípade potreby požiadať o dotazník, keďže lehota stanovená v ods. 6 písm. b) platí pre všetky takéto zainteresované strany.

b)   Zber informácií a vypočutia

Všetky zainteresované strany sa týmto vyzývajú, aby oznámili svoje stanoviská, predložili informácie iné ako odpovede vo vyplnených dotazníkoch, a poskytli podporné dôkazy. Tieto informácie musia byť spolu s podpornými dôkazmi doručené Komisii v lehote stanovenej v ods. 6 písm. b).

Komisia môže okrem toho vypočuť zainteresované strany, pokiaľ predložia žiadosť, na základe ktorej sa ukáže, že existujú osobitné dôvody, pre ktoré by mali byť vypočuté. Táto žiadosť sa musí predložiť v rámci lehoty stanovenej v ods. 6 písm. c).

5.2.   Postup zhodnotenia záujmu Spoločenstva

V súlade s článkom 21 základného nariadenia a v prípade, že sú tvrdenia o dumpingu a ním spôsobenej ujme opodstatnené, sa rozhodne o tom, či by prijatie antidumpingových opatrení nebolo v rozpore so záujmom Spoločenstva. Z tohto dôvodu výrobné odvetvie Spoločenstva, dovozcovia, ich zastupujúce združenia, zástupcovia používateľov a organizácie zastupujúce spotrebiteľov, pokiaľ preukážu, že medzi ich činnosťou a príslušným výrobkom existuje objektívne prepojenie, môžu sa v lehotách stanovených v ods. 6 písm. b) prihlásiť a poskytnúť Komisii informácie. Strany, ktoré konali v súlade s predchádzajúcou vetou, môžu v lehote stanovenej v odseku 6 písm. c) požiadať o vypočutie, pričom uvedú osobitné dôvody, pre ktoré by mali byť vypočuté. Treba poznamenať, že akékoľvek informácie predložené podľa článku 21 sa zohľadnia len v tom prípade, ak budú v čase ich predloženia podložené konkrétnymi dôkazmi.

6.   Lehoty

a)   Pre strany na vyžiadanie dotazníka

Všetky zúčastnené strany by mali požiadať o dotazník alebo iné formuláre žiadostí čo najskôr, najneskôr však do 15 dní od uverejnenia tohto oznámenia v Úradnom vestníku Európskej únie.

b)   Pre strany, ktoré sa chcú prihlásiť, aby predložili vyplnené dotazníky a akékoľvek iné informácie

Všetky zúčastnené strany, ak sa ich pripomienky počas vyšetrovania majú vziať do úvahy, sa musia prihlásiť kontaktovaním sa s Komisiou, oznámiť svoje stanoviská a predložiť vyplnené dotazníky či akékoľvek iné informácie do 40 dní od dátumu uverejnenia tohto oznámenia v Úradnom vestníku Európskej únie, ak nie je uvedené inak. Je potrebné poukázať na skutočnosť, že vykonávanie väčšiny procesných práv stanovených v základnom nariadení závisí od toho, či sa príslušná strana prihlási v rámci uvedeného obdobia.

c)   Vypočutia

V rámci tej istej 40-dňovej lehoty môžu všetky zainteresované strany takisto požiadať o vypočutie Komisiou.

7.   Písomné podania, vyplnené dotazníky a korešpondencia

Všetky podania a žiadosti predložené zainteresovanými stranami musia byť realizované písomne (nie v elektronickej forme, ak nie je uvedené inak a musia uvádzať názov, adresu, e-mailovú adresu, telefónne číslo a faxové číslo zainteresovanej strany).

Adresa Komisie na účely korešpondencie:

8.   Nespolupráca

V prípadoch, ak ktorákoľvek zainteresovaná strana odmietne sprístupniť alebo neposkytne potrebné informácie v rámci lehôt alebo významnou mierou prekáža v prešetrovaní, môžu sa v súlade s článkom 18 základného nariadenia vypracovať dočasné alebo konečné zistenia, či už pozitívne alebo negatívne, na základe dostupných skutočností.

Ak sa zistí, že ktorákoľvek zainteresovaná strana poskytla nepravdivé alebo zavádzajúce informácie, nevezmú sa tieto informácie do úvahy a môžu sa použiť dostupné skutočnosti. Ak zainteresovaná strana nespolupracuje alebo spolupracuje iba čiastočne a zistenia sa preto zakladajú na dostupných skutočnostiach v súlade s článkom 18 základného nariadenia, môže byť výsledok pre túto stranu menej priaznivý než v prípade, keby bola spolupracovala.

9.   Harmonogram prešetrovania

Prešetrovanie sa podľa článku 6 ods. 9 základného nariadenia uzavrie do 15 mesiacov odo dňa uverejnenia tohto oznámenia v Úradnom vestníku Európskej únie. V súlade s článkom 7 ods. 1 základného nariadenia možno predbežné opatrenia zaviesť najneskôr do 9 mesiacov od uverejnenia tohto oznámenia v Úradnom vestníku Európskej únie.

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(1)Ú. v. ES L 56, 6.3.1996, s. 1, naposledy zmenené a doplnené nariadením Rady (ES) č. 2117/2005 (Ú. v. L 340, 23.12.2005, s. 17).

(2)Ú. v. EÚ L 340, 23.12.2005, s. 17.

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Povolenie štátnej pomoci v rámci ustanovení článkov 87 a 88 Zmluvy o ES

Prípady, ku ktorým nemá Komisia námietky

(Text s významom pre EHP)

(2006/C 314/09)

Rozhodnutie v autentickom jazykovom znení, z ktorého boli odstránené všetky informácie, ktoré sú predmetom obchodného tajomstva, je uverejnené na stránke:

http://ec.europa.eu/community_law/state_aids/

Rozhodnutie v autentickom jazykovom znení, z ktorého boli odstránené všetky informácie, ktoré sú predmetom obchodného tajomstva, je uverejnené na stránke:

http://ec.europa.eu/community_law/state_aids/

Rozhodnutie v autentickom jazykovom znení, z ktorého boli odstránené všetky informácie, ktoré sú predmetom obchodného tajomstva, je uverejnené na stránke:

http://ec.europa.eu/community_law/state_aids/

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Oznámenie podľa čl. 95 ods. 4 Zmluvy o ES

Stiahnutie žiadosti o zachovanie vnútroštátnych právnych predpisov, ktoré sú výnimkou z ustanovení zosúlaďovacieho opatrenia Spoločenstva

(Text s významom pre EHP)

(2006/C 314/10)

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(1)Ú. v. EÚ L 304, 21.11.2003, s. 1.

(2)  Vyhláška č. 474/2000 Zb. o stanovení požiadaviek na hnojivá.

(3)Ú. v. EÚ L 150, 3.6.2006, s. 17.

(4)  http://ec.europa.eu/health/ph_risk/committees/04_scher/scher_opinions_en.htm

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EURÓPSKY HOSPODÁRSKY PRIESTOR

Dozorný orgán EZVO

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Základné informácie na uverejnenie v Úradnom vestníku EÚ

(2006/C 314/11)

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Usmernenia k metóde stanovovania pokút uložených podľa článku 23 ods. 2 písm. a) kapitoly II protokolu 4 k Dohode o dozore a Súde

(2006/C 314/12)

ÚVOD

METÓDA STANOVOVANIA POKÚT

1.   Základná výška pokuty

A.   Výpočet hodnoty predaja

B.   Stanovenie základnej výšky pokuty

2.   Úpravy základnej výšky pokuty

A.   Priťažujúce okolnosti

B   Poľahčujúce okolnosti

C   Osobitné zvýšenie odradzujúceho charakteru

D   Maximálna zákonná hranica

E   Oznámenie o zhovievavosti

F   Platobná schopnosť

ZÁVEREČNÉ POZNÁMKY

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(1)Ú. v. EÚ C 210, 1.9.2006, s. 2.

(2)  Príslušnosť vybavovať konkrétne prípady, ktoré patria do pôsobnosti článkov 53 a 54 Dohody o EHP, sa podľa pravidiel ustanovených v článku 56 Dohody o EHP delí medzi Dozorný orgán EZVO a Komisiu. Iba jeden z týchto dozorných orgánov je oprávnený vybavovať akýkoľvek daný prípad.

(3)  Podľa Dohody, ktorou sa mení a dopĺňa protokol 4 k Dohode medzi štátmi EZVO o zriadení Dozorného orgánu a Súdneho dvora z 24. septembra 2004, ktorá nadobudla účinnosť 20. mája 2005, zodpovedá kapitola II protokolu 4 k Dohode o dozore a súde vo veľkej miere nosnému nariadeniu EZVO, ktorým je nariadenie Rady (ES) č. 1 zo 16. decembra 2002 o implementácii pravidiel hospodárskej súťaže stanovených v článkoch 81 a 82 Zmluvy o ES (Ú. v. ES L 1, 4.1.2003, s. 1).

(4)  V tejto súvislosti pozri napr. rozsudky C-189/02 P, C-202/02 P, C-205/02 P až C-208/02 P a C-213/02 P, Dansk Rřrindustri A/S e.a./Commission, [2005] Zb. s. I-5425, bod 172.

(5)  Usmernenia Dozorného orgánu EZVO k metóde stanovovania pokút, Ú. v. ES C 10, 16.1.2003, s. 16 a v dodatku EHP k Ú. v. ES 3, 16.1.2003, s. 6.

(6)  Usmernenia k metóde stanovovania pokút uložených podľa článku 15 ods. 2 nariadenia č. 17 a článku 65 ods. 5 Zmluvy o ESUO (Ú. v. ES C 9, 14.1.1998, s. 3).

(7)  Túto úlohu vykonáva spoločne s Komisiou v súlade s článkom 55 Dohody o EHP, ako aj v súlade s pravidlami príslušnosti v článku 56 Dohody o EHP, pozri poznámku pod čiarou 2.

(8)  V tejto súvislosti pozri napríklad uvedený rozsudok Dansk Rřrindustri A/S e.a./Commission, bod 170.

(9)  V tejto súvislosti pozri rozsudok v spojených prípadoch 100/80 až 103/80 Musique Diffusion française e.a./Commission, [1983] Zb. s. 1825, bod 106.

(10)  Príkladom sú horizontálne dohody o stanovení cien týkajúce sa určitého výrobku, keď cena tohto výrobku bude slúžiť ako základ na určenie ceny iných výrobkov nižšej alebo vyššej kvality.

(11)  Patria sem dohody, zosúladené postupy a rozhodnutia združení podnikov v zmysle článku 53 Dohody o EHP.

(12)  Toto nemá vplyv na možnosť postupovať proti príslušnému členskému štátu EZVO.

(13)  Znenie kapitoly II protokolu 4 k Dohode o dozore a súde (ktoré zodpovedá nariadeniu 17/62 zo 6. februára 1962: prvé nariadenie o uplatňovaní článkov 85 a 86 (teraz 81 a 82) Zmluvy o ES (Ú. v. ES 13, 21.2.1962, s. 204) bolo nahradené 20. mája 2005, pozri poznámku pod čiarou 3.

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Výzva na predloženie pripomienok podľa článku 1 ods. 2 časti I protokolu 3 k Dohode o dozore a súde vo veci štátnej pomoci v súvislosti s Islandským fondom na financovanie bývania (HFF)

(2006/C 314/13)

Rozhodnutím 185/06/COL z 21. júna 2006, ktorého text uvedený v autentickom jazyku nasleduje za týmto zhrnutím, dozorný orgán EZVO začal konanie podľa článku 1 ods. 2 časti I protokolu 3 k Dohode medzi štátmi EZVO o zriadení dozorného orgánu a súdneho dvora (Dohoda o dozore a súde). Islandská vláda bola informovaná prostredníctvom kópie tohto rozhodnutia.

Dozorný orgán EZVO týmto oznamuje štátom EZVO, členským štátom EÚ a zainteresovaným stranám, že môžu predložiť svoje pripomienky k príslušnému opatreniu do jedného mesiaca od uverejnenia tohto oznámenia na:

Pripomienky budú oznámené islandskej vláde. Zainteresované strany môžu písomne s uvedením dôvodov požiadať o dôverné nakladanie s informáciami o ich totožnosti.

ZHRNUTIE

VÝCHODISKOVÁ SITUÁCIA

Dňa 11. augusta 2004 dozorný orgán EZVO prijal rozhodnutie č. 213/04/COL (1). Dozorný orgán v tomto rozhodnutí vyhlásil, že podľa článku 59 ods. 2 Dohody o EHP prevádzka Islandského fondu na financovanie bývania (HFF) je v súlade s pravidlami na poskytovanie štátnej pomoci.

HFF je inštitúcia vo výlučnom vlastníctve islandského štátu a poskytuje osobám s bydliskom na Islande úvery na zabezpečenie bývania istené hypotékou. Dozorný orgán zistil, že HFF dostal v zmysle článku 61 ods. 1 Dohody o EHP od islandského štátu štátnu pomoc na financovanie a prevádzku svojho úverového systému. Ďalej dozorný orgán zistil, že úverový systém HFF fungujúci od roku 1999 zriadil tzv. „novú pomoc“, nezákonnú z procedurálnych dôvodov, ktorá mala byť podľa článku 1 ods. 3 časti I protokolu 3 k Dohode o dozore a súde oznámená dozornému orgánu a schválená týmto orgánom ešte pred rozbehnutím tejto novej pomoci.

Napriek uvedenému dozorný orgán usúdil, že službu zriadenú fondom HFF možno klasifikovať ako „službu všeobecného hospodárskeho záujmu“ v zmysle článku 59 ods. 2 Dohody o EHP. Tento úsudok vychádzal z predpokladu, že HFF mal povinnosť poskytovať financovanie na bývanie za primerané ceny a za rovnakých podmienok na celom islandskom území, nehľadiac na ziskovosť jednotlivých úkonov. Dozorný orgán zastával názor, že HFF poskytuje službu, ktorá na Islande nie je v ponuke súkromného trhu. Preto sa dozorný orgán rozhodol schváliť úverový systém HFF jeho predbežným posúdením, pričom vôbec nezačal tzv. konanie vo veci formálneho zisťovania ustanovené v článku 1 ods. 2 časti I protokolu 3 k Dohode o dozore a súde.

Toto rozhodnutie bolo napadnuté Islandským združením bankárov a obchodníkov s cennými papiermi podaním na Súdny dvor EZVO. Žiadosť o zrušenie rozhodnutia vychádzala okrem iného z tvrdenia, že poskytovanie služieb fondom HFF nie je vo všeobecnom hospodárskom záujme, keďže súkromné banky ponúkajú financovanie bývania za porovnateľných podmienok. Preto na HFF nemôže platiť výnimka uvedená v článku 59 ods. 2 Dohody o EHP. Združenie tvrdilo, že keďže zlučiteľnosť fondu HFF s článkom 59 ods. 2 Dohody o EHP nie je jednoznačná, dozorný orgán by mal začať konanie vo veci formálneho zisťovania.

ROZHODNUTIE SÚDNEHO DVORA EZVO ZO 7. APRÍLA 2006 VO VECI E-9/04

Súdny dvor EZVO podanie združenia pripustil (2). Podľa názoru Súdneho dvora EZVO uvedená schéma štátnej pomoci vzbudila „pochybnosti... v súvislosti s jej zlučiteľnosťou s uplatňovaním Dohody o EHP“ a predbežné posúdenie tieto pochybnosti neodstránilo. Z tohto dôvodu mal dozorný orgán ešte pred prijatím rozhodnutia povinnosť začať konanie vo veci formálneho zisťovania, ako sa ustanovuje v článku 1 ods. 2 časti I protokolu 3 k Dohode o dozore a súde. Toto sa nestalo, a preto Súdny dvor EZVO zrušil rozhodnutie dozorného orgánu EZVO.

Súdny dvor EZVO zistil, že služba, ktorá má také ciele, aké má úverová schéma fondu HFF, by mohla byť klasifikovaná ako služba všeobecného hospodárskeho záujmu, čo by oprávňovalo udelenie štátnej pomoci v súlade s uplatnením článku 59 ods. 2 Dohody o EHP. Určité prvky tejto úverovej schémy však vzbudzujú pochybnosti, pokiaľ ide o jej zlučiteľnosť s uplatňovaním Dohody o EHP. Úverová schéma sa neobmedzovala na poskytovanie úverov na stavbu alebo kúpu len takého bývania, ktoré by spĺňalo nejaké konkrétne kritériá, čo sa týka jeho veľkosti alebo hodnoty. Úverová schéma sa neobmedzovala ani na asistenciu ponúkanú príjemcom úverov pri financovaní svojho bývania. Súdny dvor EZVO tiež zistil, že nie sú nijaké pochybnosti, pokiaľ ide o určenie relevantného trhu výrobku, aby sa dalo posúdiť, či úverová schéma ovplyvní vývoj na trhu v neprospech zmluvných strán Dohody o EHP v zmysle článku 59 ods. 2 Dohody o EHP.

DÔSLEDKY ROZSUDKU

Cieľom tohto otvárania rozhodnutia je reagovať na rozsudok Súdneho dvora EZVO a vyzvať dotknuté strany, aby predložili svoje pripomienky v záujme vyjasnenia, či sú služby poskytované fondom HFF v súlade s podmienkami ustanovenými v článku 59 ods. 2 Dohody o EHP.

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(1)  Základné informácie týkajúce sa tohto rozhodnutia boli uverejnené v Ú. v. EÚ C 112, r. 2005, s. 8. Plné znenie tohto rozhodnutia, ktoré nemá dôverný charakter, je k dispozícii na webovej stránke dozorného orgánu EZVO (odkaz na ňu je uvedený v základných informáciách): www.eftasurv.int/fieldof work/fieldstateaid/stateaidregistry/

(2)  Rozsudok zo 7. apríla 2006, vec E-9/04, Islandské združenie bankárov a obchodníkov s cennými papiermi verzus dozorný orgán EZVO [2006], správa Súdneho dvora EZVO (zatiaľ nepredložená). Rozsudok sa nachádza na webovej stránke Súdneho dvora EZVO: www.eftacourt.lu

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EFTA SURVEILLANCE AUTHORITY DECISION

No 185/06/COL

of 21 June 2006

to initiate the formal investigation procedure provided for in Article 1(2) in Part I of Protocol 3 to the Surveillance and Court Agreement with regard to the Icelandic Housing Financing Fund

(Iceland)

THE EFTA SURVEILLANCE AUTHORITY,

HAVING REGARD TO the Agreement on the European Economic Area (1), in particular to Articles 59, 61 to 63 and Protocol 26 thereof,

HAVING REGARD TO the Agreement between the EFTA States on the Establishment of a Surveillance Authority and a Court of Justice (2), in particular to Article 24 and Protocol 3 thereof,

HAVING REGARD TO the EFTA Surveillance Authority's Decision No 213/04/COL of 11 August 2004 concerning the Icelandic Housing Financing Fund and an increase of lending by that fund up to 90 % of the purchase price of housing (3),

HAVING REGARD TO the judgment of the EFTA Court dated 7 April 2006 in Case E-9/04 concerning an application for annulment of Decision No 213/04/COL regarding the Icelandic Housing Financing Fund (4),

HAVING REGARD TO the Authority's Guidelines (5) on the application and interpretation of Articles 61 and 62 of the EEA Agreement, and in particular Chapter 18C on ‘State aid in the form of public service compensation’,

WHEREAS:

I.   FACTS

1.   Introduction

On 11 August 2004, the EFTA Surveillance Authority (hereinafter referred to as ‘the Authority’) adopted Decision No 213/04/COL. In this Decision the Authority declared, according to Article 59(2) of the EEA Agreement, the Icelandic Housing Financing Fund (Íbúðalánasjóður) to be compatible with the State aid rules.

The Icelandic Housing Financing Fund (hereinafter referred to as ‘the HFF’ or ‘the HFF system’), an institution wholly owned by the Icelandic State, provides mortgage-secured housing loans to residents in Iceland. The Authority found that in funding and operating its loan system, the HFF received State aid from the Icelandic State within the meaning of Article 61(1) of the EEA Agreement. Furthermore, the Authority found that the HFF system, established in 1999, constituted ‘new aid’, unlawful on procedural grounds, which should have been notified to and approved by the Authority pursuant to Article 1(3) in Part I of Protocol 3 to the Surveillance and Court Agreement, prior to putting it into effect.

Nevertheless, the Authority concluded that the service provided for by the HFF could be qualified as a ‘service of general economic interest’, in the meaning of Article 59(2) of the EEA Agreement. This conclusion was based on the premise that the HFF was obliged to provide house financing at affordable rates and on equal conditions throughout the entire Icelandic territory, irrespective of the profitability of individual operations. In the Authority's view, the HFF offered a service which was not available on the private market in Iceland. Therefore, the Authority decided to approve the HFF system, by means of a preliminary examination, without opening the so-called formal investigation procedure provided for in Article 1(2) in Part I of Protocol 3 to the Surveillance and Court Agreement.

This Decision was challenged before the EFTA Court by an application of the Bankers' and Securities' Dealers Association of Iceland. The annulment action was, inter alia, based on the plea that the HFF did not provide a service of general economic interest, since the private banks offered house financing at comparable conditions. The HFF could therefore not profit from the derogation in Article 59(2) of the EEA Agreement. It was further argued that because of the difficulty to declare the HFF compatible with Article 59(2) of the EEA Agreement, the Authority should have opened the formal investigation procedure.

The EFTA Court sustained the application. In the opinion of the EFTA Court, the State aid scheme in question had raised ‘doubts ... as to the compatibility with the functioning of the EEA Agreement’, doubts which had not been overcome by means of the preliminary examination. Hence, the Authority was under an obligation to initiate a formal investigation procedure as provided for under Article 1(2) in Part I of Protocol 3 to the Surveillance and Court Agreement, before making a decision. This was not done and, for that reason, the EFTA Court annulled the Authority's Decision.

With regard to the application of Article 59(2) of the EEA Agreement, the Court found that a service with the objectives of the HFF's loan scheme may qualify as a service of general economic interest justifying State aid. However, certain specific features of the scheme gave rise to doubts as to the compatibility with the functioning of the EEA Agreement. The loan scheme was not limited to providing loans for the construction or purchase of dwellings that fulfilled any particular criteria as to size or value. Neither was the lending scheme limited to assisting the borrowers in financing their own dwellings. The EFTA Court also found that there were doubts as to the identification of the relevant product market for the assessment of whether the lending scheme would affect the development of trade contrary to the interest of the Contracting Parties to the EEA Agreement, in the meaning of Article 59(2) of the EEA Agreement.

The purpose of this opening Decision is to follow the EFTA Court's judgment and to call upon the parties concerned to submit their comments, in order to clarify whether the services provided by the HFF comply with the conditions laid down in Article 59(2) of the EEA Agreement.

2.   The administrative procedure and developments leading up to the EFTA Court's judgment of 7 April 2006

By letter of 20 November 2003 from the Icelandic Mission to the EU, forwarding a letter from the Icelandic Ministry of Finance dated the same date, both received and registered by the Authority on 25 November 2003 (Doc No: 03-8227 A, now Event No: 255584), the Icelandic Government notified, pursuant to Article 1(3) in Part I of Protocol 3 to the Surveillance and Court Agreement, an increase of lending by the HFF up to 90 % of the purchase price of housing.

According to Article 5(1) in Part II of Protocol 3 to the Surveillance and Court Agreement, the Competition and State Aid Directorate sent a letter dated 23 January 2004 (Event No: 184357), requesting additional information from the Icelandic Government. By letter of 11 March 2004 from the Icelandic mission to the EU, forwarding a letter from the Icelandic Ministry of Finance dated the same date, both received and registered by the Authority on 12 March 2004 (Event No: 259197), the Ministry of Finance replied to the request for additional information. Attachments to the letter of 11 March 2004 were forwarded separately by the Icelandic Mission to the EU on 18 March 2004, received and registered by the Authority on the same day (Event No: 259976).

By letter dated 23 April 2004, received and registered by the Authority on 27 April 2004 (Event No: 279495), the Bankers' and Securities Dealers' Association of Iceland (hereinafter referred to as ‘SBV’) lodged a complaint with the Authority, alleging that the ‘... current legislation in Iceland on the operation of the State Housing Financing Fund is incompatible with the EEA Agreement, in particular the competition rules, the rules on State aid, free movement of services, capital and the freedom of establishment of the EEA Agreement’. As a consequence of this complaint, the Authority opened two additional cases, to the already existing State aid case, which dealt separately with the alleged infringements of the competition rules and the rules on the four freedoms.

Based on Article 5(1) in Part II of Protocol 3 to the Surveillance and Court Agreement, the Competition and State Aid Directorate sent a letter dated 14 May 2004 (Event No: 280306) to the Icelandic Government requesting, for a second time, information and clarification, and forwarded by that letter with the consent of SBV, a copy of the complaint.

The notification was discussed between representatives of the Icelandic Ministries of Finance and Social Affairs, the HFF and the Authority during the State aid package meeting in Reykjavik on 26 May 2004. By letter of 10 June 2004 from the Icelandic Mission to the EU, forwarding a letter from the Icelandic Ministry of Finance dated the same date, both received and registered by the Authority on 11 June 2004 (Event No: 284350), the Ministry of Finance replied to the second request for information.

On the request of SBV, a meeting took place in Brussels on 14 June 2004 between representatives of SBV and the Authority, to discuss the complaint.

By letter of 23 June 2004 (Event No: 284459), the Authority informed SBV that it saw no reason to take further action on the complaint with regard to the alleged abuse of the dominant position of the HFF. Therefore, the Authority indicated that it was inclined to close the case, unless SBV would submit further information or arguments within two weeks from the receipt of the letter. SBV did not react to the letter.

On 1 July 2004, the Icelandic Mission to the EU forwarded a letter from the Icelandic Ministry of Finance dated 30 June 2004, received and registered by the Authority on 1 July 2004 (Event No: 286392), in which the Icelandic Government provided outstanding information in response to the Authority's second information request.

By letter of 1 July 2004 (Event No: 285198), the Authority informed SBV that it had not been able to detect any incompatibility of the HFF system with the four freedoms. SBV was informed that the case was proposed to be closed and was invited to submit its comments at the latest by 12 July 2004. SBV did not react to the letter.

The Authority received an email from the Department of Local Government in the Ministry of Social Affairs on 7 July 2004, registered by the Authority on 8 July 2004 (Event No: 287125), by which the Icelandic Government forwarded the following laws: Act No 57/2004, amending the Housing Act No 44/1998; Regulation No 544/2004 on ‘the Finances and Risk Management of the Housing Financing Fund’; Regulation No 522/2004 on ‘HFF Mortgages and HFF Bonds’; Regulation No 521/2004 on ‘Loan Proportions and Maximum Amounts of HFF Mortgages’ (6). By the same email the Icelandic Government also provided a document on the HFF's Funding and Risk Policy elaborated by a financial consultant.

Supplementary information and explanations concerning the above mentioned laws, the document on the HFF's Funding and Risk Policy, and certain other issues were sent by fax from the Icelandic Ministry of Social Affairs dated 8 July 2004, forwarded to the Authority by letter of 9 July 2004 from the Icelandic Mission to the EU, received and registered by the Authority on the same day (Event No: 287337).

In light of the Authority's assessment of the raised competition issues and SBV's inactivity, the Authority decided to close the case and informed SBV of this closure by letter of 27 July 2004 (Event No: 288068).

On 11 August 2004, the Authority adopted Decision No 213/04/COL approving the HFF system and declaring it compatible with Article 59(2) of the EEA Agreement (7).

By letter dated 23 August 2004 (Event No: 289467), the Authority informed SBV that it had closed the case with regard to the alleged violation of the four freedoms.

By letter dated 15 September 2004 (Event No: 292140), the Authority informed SBV of Decision No 213/04/COL and attached, to this end, a copy of the decision.

By an application lodged at the Registry of the EFTA Court on 23 November 2004, SBV brought an action under Article 36 of the Surveillance and Court Agreement for annulment of the Authority's Decision No 213/04/COL.

On 7 April 2006, the EFTA Court rendered its judgment in the case and annulled the Authority's Decision No 213/04/COL (hereinafter referred to as the ‘annulled Decision’) (8).

3.   The HFF system

3.3.   Background

In 1955, a basis for State involvement, both as regards policy making in the field of housing affairs and the provision of loans for private housing, was laid. Later the State Housing Agency (Húsnæðisstofnun ríkisins) was established by Act No 51/1980 and provided, inter alia, loans on preferential terms to private home buyers.

In 1986 Icelandic Government assistance to private home-ownership was tied to access to pension funds, with the pension funds being required to provide partial funding for the system. The Icelandic banks generally did not provide funding for private housing. At this time, the State Housing Agency issued housing loans at affordable rates. This led to a substantial increase in demand, which in turn stretched the resources of the pension funds beyond their limits. To remedy the situation and in order to generate more financial resources to finance housing, a Housing Bond system was introduced in 1989. The Housing Bond system generated funding for the provision of housing loans. The issuing of Housing Bonds and the operation of the system were entrusted to the State Housing Agency.

The Housing Bond system was not a traditional mortgage loan system, but a bond swap system, meaning that homebuyers applied to the HFF to issue a mortgage bond, which was secured against the property to be bought. The State Housing Agency then bought this bond from the homebuyer and paid for it by issuing a Housing Bond to the seller. This Housing Bond could then be freely traded in the securities market. The seller could sell the Housing Bond on the securities market, use it as means of payment or keep it.

The Housing Bonds had maximum loan periods of 40 years but were subject to prepayment without penalty. They were linked to the consumer price index and carried a fixed real interest of 4,75 %. The Housing Bonds were secured by all the assets of the State Housing Agency, which consisted primarily of the collateral (mortgage-secured bonds) that the Agency held in property. In addition, the Housing Bonds carried an implicit State guarantee, due to the State ownership of the State Housing Agency.

The mortgage bonds had the same loan terms as the Housing Bonds, but with a fixed interest surcharge of 0,35 percentage points, to cover operational costs and expected losses on loans. This meant that the lending rate under the Housing Bond system was set at 5,10 % in real terms.

3.2.   The Act on Housing Affairs No 44/1998

On 1 January 1999, the Act on Housing Affairs No 44/1998 (hereinafter referred to as ‘the Housing Act’) entered into force (9).

The Housing Act established and governed the HFF (10). The HFF was entrusted with the management and implementation of housing affairs under the Housing Act. The previous State Housing system was repealed (11) and the HFF took over all assets and obligations of the State Housing Agency (12), including the tasks of issuing Housing Bonds and providing housing loans through the bond-swap system. The HFF is a separate State-owned institution subject to special management. The State carries full liability for all obligations undertaken by the HFF. Organisationally, the HFF is accountable to the Minister of Social Affairs, who appoints its Board of Directors in accordance with Article 7 of the Housing Act.

According to Article 1 of the Housing Act, it is the purpose of this Act ‘... to promote, through the granting of loans and the organisation of housing affairs, the ability of Icelanders to live with security and equal rights in housing affairs along with the special allocation of funds to increase people's chances of acquiring or renting housing on manageable terms’.

The Housing Act was amended, inter alia, by Act No 57/2004, which entered into force on 1 July 2004. A number of changes were made to the housing loan system. These changes comprised, inter alia, the abolition of the system of swapping mortgage bonds for Housing Bonds. After 1 July 2004, loans have been paid out in cash to home buyers and secured by mortgages in the property under purchase.

At the time the Authority adopted the annulled Decision, the HFF provided the following three loan categories:

3.2.1.   General Loans

The conditions for general loans are established in Chapter VI of the Housing Act. The general loans are available on equal terms to all residents in Iceland, regardless of nationality, on the conditions laid down in and pursuant to the Housing Act. The loans are not limited to persons with income below a certain income bracket or with limited assets.

Before a general loan is paid out, the borrower must issue a borrower's mortgage instrument as a security as stated in Article 19(1) of the Housing Act. Article 19(2) of the Housing Act and Articles 2 and 3 of Regulation No 521/2004 on ‘Loan Proportions and Maximum Amounts of Borrowers' Mortgages’ set out maximum amounts for general loans in percentage of the value of the housing and in absolute figures.

According to Article 19(2) of the Housing Act, prior to 1 July 2004, a mortgage bond was exchanged for a Housing Bond for an amount up to 70 % of a dwelling's appraised value if the applicant was buying or building his first dwelling, but otherwise for up to 65 % of the dwelling's appraised market value (the ‘relative lending cap’). The loans were also limited in relation to the fire insurance value, which was often lower than the market value. The relative lending cap has later been raised to 90 % with Act No 120/2004, amending the Housing Act, which entered into force on 3 December 2004.

In addition to the relative lending cap, the Housing Act, both under the bond-swap system and after the amendments of 1 July 2004, states that a maximum lending cap is to be specified in regulations (the ‘absolute lending cap’). As specified in Regulation No 521/2004, which entered into force on 1 July 2004, the absolute lending cap was ISK 9,7 million for new housing and ISK 9,2 million for existing housing. Regulation No 959/2004 replaced Regulation No 521/2004 on 6 December 2004 and the absolute lending cap was raised to ISK 14,9 million (subsequently increased to ISK 15,9 million and later to ISK 18 million) for both new and existing housing.

With the entry into force of Regulation No 522/2004 on 1 July 2004, a limit was set of two dwellings for each borrower financed through HFF general loans. In exceptional circumstances, a loan for a third dwelling could be authorised, but it would be up to the Board of Directors to define the precise conditions for such an exception.

3.2.2.   Additional Loans and Loans for rental housing

Prior to the amendments of 1 July 2004, additional loans and loans for rental housing were not financed through Housing Bonds, but through a separate class of bonds issued by the HFF. As of 1 July 2004, the HFF stopped issuing both separate class of bonds and the Housing Bonds. The main means of funding the HFF became the HFF bonds. Unlike the Housing Bonds, which were subject to prepayment without penalty, the HFF bonds are non-callable. As for the loans from the HFF which are still subject to prepayment without penalty, the interest surcharge paid by borrowers was increased from 0,35 to 0,6 percentage points as of 1 July 2004, in order to take account of the new risk created by the mismatch in optionality between assets and liabilities. However, as the HFF bonds are issued in classes with varying interest rates depending on the market situation, the interest rates charged to HFF borrowers fluctuate.

3.3.   The financing mechanism

The HFF financed its tasks with the income from the fund's equity capital (i.e. the payments, interest and indexation of granted loans), by issuing Housing Bonds and by the sale of Housing Authority Bonds and the taking of loans (13).

The HFF's management of its assets and liabilities is described in Article 11 of the Housing Act. The HFF must always have adequate liquid funds to honour its obligations. Furthermore, it has to keep its revenues and expenses in balance and must establish a risk management system. Further requirements concerning risk management are set out in Articles 6 and 7 of Regulation No 544/2004 on ‘the Financing and Risk Management of the Housing Financing Fund’, according to which the HFF must, inter alia, keep its equity ratio over 5 % and provide quarterly reports on the progress of its risk management policy and key figures in operation to the Minister of Social Affairs and the Financial Supervisory Authority.

In case of unexpected difficulties such as illness, accident, loss of employment or comparable situations, the HFF may extend refinancing loans for up to 15 years in order to address temporary payment difficulties experienced by borrowers according to Article 48(1) of the Housing Act. The HFF is further authorised to freeze payments from borrowers for up to three years and add the payments due during that period to the debt proper, if this is considered likely to prevent payment difficulties as stated in Article 48(2) of the Housing Act.

According to Articles 2 and 3 of Regulation No 119/2003 on ‘Treatment of claims by the Housing Financing Fund that are without Collateral’, the HFF shall not make claims against borrowers individually if a house or apartment which stands as a security for a HFF loan is sold or auctioned as a part of collection proceedings and the price does not cover the claim of the HFF. The remaining debt does not accumulate interest and is not subject to index linkage. If the borrower wants to obtain a new loan from the HFF during a period of 5 years after the sale or the auction, he/she can pay up the remaining debt by paying half the nominal amount, upon which the HFF is authorised to write off the other half according to Article 5. As stated in Article 6, five years after an apartment or a house is sold or auctioned as a part of collection proceedings, the HFF can write off the remaining debt if the borrower shows himself/herself unable to pay.

With regard to the HFF's more detailed financial figures, the Authority's annulled Decision was based on the following information, which was submitted by the Icelandic Government in the initial notification:

4.   Icelandic market for house financing and possible trade effects

4.1.   Situation before August 2004

The Icelandic market for mortgage loans was largely divided between three main actors. These were the HFF (previously the State Housing Agency), the pension funds and other private credit institutions. Between 1997 and 2003, the State Housing system had a market share of about 77,5 % to 79 %. The rest was shared between the pension funds (approximately 13 % to 17 %) and the commercial banks and savings banks (approximately 4,5 % to 8 %). The banks did, however, provide certain services for the HFF, such as being the sole agents for evaluating borrowers for the HFF. Until a process of privatisation was completed in 2002 — 2003, most of the commercial banks were controlled by the State as majority shareholder.

The Icelandic Government stated that private banks almost exclusively restricted lending for housing purchases to property around the Reykjavik area. The Icelandic Government stressed that the HFF is the only lender which offered loans on equal terms which are universally accessible throughout the Icelandic territory. When lending is broken down by geographic areas the trend shows that the further one moves outside of Reykjavik the higher the proportion of the HFF lending gets.

SBV has submitted some documentation during the EFTA Court proceedings, which, in SBV's opinion, demonstrated that the commercial banks have granted affordable loans outside the Reykjavik area during the period between 1999 and August 2004.

As regards the financial institutions' interest rates charged on loans, the Icelandic Government provided in the initial notification lending rates of banks and pension funds for the years 1999 to 2003, which showed an average lending rate in real terms of approximately 7,4 %.

The Icelandic Government further presented, in the initial notification, average funding rates by financial institutions in the Icelandic housing finance market for the years 1999 to 2003. The information showed average funding rates for banks (real interest rates) of 6,43 %, for pension funds of 3,50 % and for the HFF of 4,75 %.

According to information submitted by SBV, all commercial banks in Iceland, savings banks, pension funds and some mortgage companies offered long-term housing loans to the public. According to SBV, these loans carried a real interest rate of between 5,9 % and 7,9 % depending on the security.

According to the Icelandic Government, the housing loan market for individuals is by its nature a local market and does ‘normally’ not involve any direct cross-border transactions. The Icelandic Government stressed that no foreign banks are granting mortgage loans in ISK to Icelandic households. Furthermore, it was stated, in the initial notification, that there were currently no foreign financial institutions or representative offices of foreign financial institutions in Iceland. It was moreover pointed out that the Icelandic economy was very limited in size. The limited number and small size of transactions in trade in the foreign exchange markets of the ISK did not warrant interest from foreign banks. The special geography and the scattered population outside Reykjavik further reduced the foreign interest for lending to the Icelandic housing market.

4.2.   Situation after August 2004

During the court proceedings, SBV argued that the market situation in Iceland changed in summer 2004. According to SBV, commercial banks have offered competitive rates compared to HFF rates and have gained market shares. SBV stated in its application to the EFTA Court that ‘[...] commercial banks in Iceland have demonstrated, through recent cuts in interest rates, that they would be both willing and able to provide general loans on similar terms (or even better) then HFF’. It was, for example, submitted that since summer 2004, the gap between commercial banks and the HFF has completely disappeared, as the banks have reduced their interest rates on long-term housing loans to 4,2 % due to their improved refinancing conditions.

According to a Icelandic news agency (16), the price of residential property in the Reykjavík area has risen by 67 % since August 2004, when the commercial banks entered the mortgage market.

5.   Alternatives to the HFF system

In the procedure leading up to the annulled Decision, the Icelandic Government discussed possible alternatives to the HFF system. The Icelandic Government stated, inter alia, that abandoning Government intervention in house financing would lead to considerable changes for lower and middle income families, increase division between the Reykjavik area and the rest of the country and dramatically reduce the number of families able to purchase housing on the market. Alternatively, entrusting banks to lend with the same favourable conditions would not be possible without massive direct State aid.

The Icelandic Government discussed, in the initial notification of 20 November 2003, the following alternative models:

II.   APPRECIATION

1.   State aid within the meaning of Article 61(1) of the EEA Agreement

Article 61(1) of the EEA Agreement reads as follows:

‘Save as otherwise provided in this Agreement, any aid granted by EC Member States, EFTA States or through State resources in any form whatsoever which distorts or threatens to distort competition by favouring certain undertakings or the production of certain goods shall, in so far as it affects trade between Contracting Parties, be incompatible with the functioning of this Agreement.’

This implies that for measures to be classified as State aid within the meaning of Article 61(1) of the EEA Agreement, they must be granted by the State or through State resources, confer an advantage on the recipient, be liable to affect trade between the Contracting Parties and distort competition.

Beforehand, it needs to be clarified whether the HFF is subject to the application of Article 61(1) of the EEA Agreement, since it has been argued by the Icelandic Government, in the initial notification, that the HFF could not be qualified as an undertaking in the meaning of that Article.

Firstly, the HFF is a separate State-owned institution set up by law, having its own board of directors and annual accounts. Secondly and more importantly, the Court of Justice of the European Communities (hereinafter referred to as ‘the Court of Justice’) has repeatedly defined the concept of an undertaking as any entity engaged in an economic activity, which is any activity which offers goods or services on a given market, regardless of its legal status and the way in which it is financed (17). Although the Icelandic Government considers the HFF not to be a separate undertaking, as it operates only as a ‘branch of the State itself’, the Authority takes the view that the HFF is engaged in an economic activity. The economic activity consists of offering services on the market for housing mortgage loans, i.e. long-term house financing (for residential accommodation). Therefore, it is the Authority's preliminary conclusion that the HFF has to be qualified as an undertaking in the sense of Article 61(1) of the EEA Agreement.

1.1.   Transfer of State resources and thereby favouring certain undertakings

In order to qualify as State aid, the HFF system must imply a transfer of State resources and thereby confer on the Housing Financing Fund an advantage that relieves it of charges that are normally borne from its budget.

1.1.1.   The Altmark conditions

The Icelandic Government argued initially in its notification that the HFF system does not constitute State aid, because the system would, inter alia, not confer any advantage on the HFF. In this respect, the Icelandic Government referred to the Altmark ruling (18) of the Court of Justice and argued that the HFF system would comply with all of the four criteria that the Court of Justice established in that ruling.

It needs to be recalled that the Court of Justice has established the following conditions, which need to be fulfilled cumulatively, for a State measure to escape the classification of State aid. These conditions are:

It is the Authority's preliminary opinion that the HFF system neither complies with the second nor with the fourth condition (19). Concerning the second condition, the Icelandic authorities did not establish in advance, and in an objective and transparent manner, the parameters on the basis of which the compensation was to be calculated, in order to avoid conferring an economic advantage, which may favour the HFF over competing undertakings. The Icelandic Government has not demonstrated that such an ex ante assessment has taken place in an objective and transparent manner. To establish the parameters for the calculation of the compensation would have required quantifying the costs incurred in discharging the public service obligation in advance and comparing them with the possible benefits that the HFF enjoys. However, such quantification of costs has not taken place. Based on that shortcoming, it is not apparent from the outset what the level of compensation will amount to, since the isolated costs incurred in discharging the public service obligation have not been identified. Furthermore, with regard to the fourth condition, the HFF has neither been chosen by way of a public procurement procedure nor did the Icelandic authorities determine the level of compensation by way of a comparison between the HFF and a privately run ‘reference company’, taking into account the relevant receipts and a reasonable profit for discharging the obligations.

Since the HFF system seems not to comply with all of the above mentioned conditions, there is a presumption that the HFF system involves State aid, if the conditions of Article 61(1) of the EEA Agreement are met.

1.1.2.   Possible State aid elements

The HFF enjoys an implicit State guarantee for all of its securities. The State guarantee results in a more favourable credit rating for its bonds than bonds issued by private undertakings. This leads to cheaper funding costs for the HFF. Private credit institutions do not benefit from such a State guarantee. The State guarantee confers an advantage on the HFF compared to private credit institutions. The HFF is not subject to a State guarantee fee under Article 7 of Act No 121/1997 on State Guarantees. Hence, the Icelandic State is foregoing revenue it would normally collect. Since the HFF is not paying a premium for the State guarantee it enjoys, it is the Authority's preliminary conclusion that the State guarantee, without any sort of premium to be paid, implies a transfer of State resources which favours the HFF.

The HFF received interest support from the State to cover obligations resulting from lending below market rates at 3,5 % and 4,5 % for rented housing for low income families. The support has varied through the years. It was ISK 9 million in 2001 and 71 million in 2002. This interest support is financed by State resources. It is the Authority's preliminary conclusion that the interest support constitutes an aid element. The Authority is not in possession of any up-dated figures with regard to the interest support for the years 2003 to 2006. If interest support was granted in these years, the Authority would qualify such support, in light of the above assessment, as a transfer of State resources which favours the HFF.

The HFF is exempted from corporate tax and property tax. The HFF has not paid what would have amounted to ISK 335 million in corporate tax and 417 million ISK in property tax for the years 1999 to 2002. Thus, the Icelandic State has foregone income, which under normal circumstances would have been charged to the HFF's budget. It is the Authority's preliminary conclusion that the exemptions from corporate and property tax constitute aid elements. The Authority is not in possession of any up-dated figures for the years 2003 to 2006. Any forgone tax for these years would qualify, in light of the above assessment, as a transfer of State resources which favours the HFF.

The HFF is charged with preserving and earning a return on the funds it supervises. The return is intended to sustain the operations of the HFF. The HFF is, however, not required to pay out any dividends to its owner.

A normal market investor requires a sufficient return on his capital. It is the Authority's preliminary view that the fact that the HFF is per se relieved from paying out any dividends to its owner might imply that it is generating not a sufficient return on capital a normal market investor would expect and that this might imply foregone revenues for the State and thereby a transfer of State resources which favours the HFF.

The Icelandic Government argued that the special status of the HFF implied that it was not subject to the same rules (20) as private credit institutions, as regards capital adequacy requirements and minimum solvency ratio rules.

However, if the HFF were covered by the same rules as private credit institutions, then an exemption from these rules could imply State aid.

Capital adequacy requirements and minimum solvency ratio rules for credit institutions are contained in the Act referred to in point 14 of Chapter II(i) of Annex IX to the EEA Agreement (hereinafter referred to as ‘the Banking Directive’) (21). In this context, the Authority notes that the adaptation text (22) to Article 2(3) of the Banking Directive explicitly exempted from the scope of that Directive in Iceland the ‘Byggingarsjóðir ríkisins’ (literally translated ‘the State's Building Funds’ (23)). The Icelandic Government stated that this term was traditionally used for the funds operated by the predecessor of the HFF, namely the State Housing Board, which comprised the State Housing Fund and the Workers' Building Fund. The HFF was established by taking over all assets and obligations of the State Housing Board.

Furthermore, Article 1(1) of the Banking Directive defines a credit institution as ‘an undertaking whose business is to receive deposits or other repayable funds from the public and to grant credits for its own account [...]’. Given the way the HFF's financing mechanism operates, the Authority cannot see how the HFF could be classified as a credit institution in the meaning of the Banking Directive because the HFF is not receiving any deposits or other repayable funds from the public.

In light of the above and for the limited purpose of identifying possible State aid elements, it is the Authority's preliminary conclusion that the HFF is not covered by the scope of the Banking Directive. The HFF is therefore not subject to the same rules as private credit institutions as regards capital adequacy requirements and minimum solvency ratio rules. Since the HFF is not subject to these rules, it is consequently not relieved of charges that it would normally bear from its own budget. Hence, excluding the HFF from these requirements seems not to entail an aid element.

In any event, even if the HFF should have been subject to these rules, an exemption from these rules seems not to imply that any State resources have been transferred to the HFF. A transfer of State resources is, however, a necessary condition, in order to qualify a measure as State aid in the meaning of Article 61(1) of the EEA Agreement (24).

1.2.   Distortion of competition and effect on trade between Contracting Parties

The granting of loans for financing purchases of residential accommodation is a financial service which, in the present market circumstances, is predominantly of a local character and normally does not involve any direct cross-border transactions. Distortion of competition arising from financial advantages accorded to the HFF operating such services seems therefore prima facie likely to have only limited direct trade effects. However, it cannot be excluded that the aid, which is involved in the HFF system, threatens to distort competition between banks in the European Economic Area, by making it more difficult for them to enter the Icelandic housing mortgage loan market. Such a potential effect on trade is sufficient for State aid to be caught by Article 61(1) of the EEA Agreement.

1.3.   Conclusion

In light of the above, it is the Authority's preliminary conclusion that the HFF system involves State aid within the meaning of Article 61(1) of the EEA Agreement. To enable the Authority to calculate the amount of potential State aid involved, it is necessary, in the course of this formal investigation procedure, to obtain up-dated figures concerning the HFF's financing mechanisms.

2.   Notification requirement and Standstill obligation

Pursuant to Article 1(3) in Part I of Protocol 3 to the Surveillance and Court Agreement, ‘the EFTA Surveillance Authority shall be informed, in sufficient time to enable it to submit its comments, of any plans to grant or alter aid (...). The State concerned shall not put its proposed measures into effect until the procedure has resulted in a final decision’.

The above notification requirement and standstill obligation concern ‘new aid’. On the other hand, ‘existing aid’ can be granted until the Authority finds the aid in question to be incompatible with the functioning of the EEA Agreement.

The HFF system was not notified to the Authority. The HFF was established and entered into force on 1 January 1999, i.e. after the entry into force of the EEA Agreement, taking over all assets and obligations of its predecessor, the State Housing Agency. In this context, the Icelandic Government argued that the HFF system had to be classified as existing aid.

The Authority does not share this point of view. In deciding whether or not an aid scheme is to be regarded as ‘new aid’ or ‘existing aid’, the Authority examines the relevant legal provisions providing for the aid in question and in particular the entry into force of these provisions.

In such cases the Authority is not obliged to carry out an economic analysis of the measure in question as compared to aid schemes which were in place prior to the introduction of the new legal provisions. This view is confirmed by the ruling of the Court of Justice in Namur-Les Assurances. In that ruling the Court held that ‘[...] the emergence of new aid or the alteration of existing aid cannot be assessed according to the scale of the aid or, in particular, its amount in financial terms at any moment in the life of the undertaking if the aid is provided under earlier statutory provisions which remain unaltered. Whether aid may be classified as new aid or as alteration of existing aid must be determined by reference to the provisions providing for it’ (25)(emphasis added).

The fact that the HFF system is the result of alterations to an old system, by merging different legal entities, and that a complete new law was adopted, which repealed the previous State Housing system, and which forms the legal basis of the HFF and the loan system, are sufficient grounds to classify the entire HFF system as ‘new aid’ within the meaning of Article 1(3) in Part I and Article 1(c) in Part II of Protocol 3 to the Surveillance and Court Agreement (26).

Therefore, it is the Authority's preliminary conclusion that the HFF system, established in 1999, constitutes ‘new aid’, which, pursuant to Article 1(3) in Part I of Protocol 3 of the Surveillance and Court Agreement, should have been notified to the Authority in advance (27). Since the HFF system was not notified to the Authority, it is considered to constitute ‘aid unlawful on procedural grounds’, in accordance with Articles 1(f) and 10 et seq. in Part II of Protocol 3 to the Surveillance and Court Agreement (28). It should be recalled that any unlawful aid, which is finally not declared compatible with the functioning of the EEA Agreement, is subject to recovery, in accordance with Article 14 in Part II of Protocol 3 to the Surveillance and Court Agreement. This issue will be further addressed below in section II.4. of this Decision.

3.   Compatibility of the aid

The Authority cannot declare State aid compatible with the functioning of the EEA Agreement, if that aid would infringe other provisions of the EEA Agreement. SBV submitted in its initial complaint that the ‘Housing Financing Fund is incompatible with the EEA Agreement, in particular the competition rules, the rules on State aid, free movement of services, capital and the freedom of establishment’.

In relation to the competition rules, the free movement of services, capital and the freedom of establishment, the Authority assessed these allegations and restated in its annulled Decision that they were unfounded.

With regard to the alleged infringement of some of ‘the four freedoms’, the Authority found that it was the State aid which created the possible hindrances to the free movement of services, capital and establishment. The effect of these possible hindrances was indissolubly linked to the objective of the State aid. Therefore, the Authority concluded that the case should be assessed under the lex specialis of the State aid rules and that the rules on the ‘four freedoms’ should not be applicable (29).

This view was confirmed by the EFTA Court in this judgment of 7 April 2006, when it held that:

‘With regard to the effects that the HFF general loans scheme may have on the free movement of services and capital and the right of establishment, the Court holds that any such effects would indeed seem inherent in the State-supportive elements of the HFF system and therefore are so indissolubly linked to the object of the aid that it is impossible to evaluate them separately (see to this effect Case 74/76 Iannelli & Volpi SpA v Ditta Paolo Meroni [1977] ECR 557, at paragraph 14).’ (30)

With regard to the alleged infringement of the competition rules (the complainant alleged in particular an infringement of Articles 59(1) and 54 of the EEA Agreement), the Authority stated in the annulled Decision that SBV's complaint did not warrant the initiation of formal proceedings, since SBV did not substantiate that the HFF abused or will abuse its position as a consequence of the legislative framework by which it was governed.

In light of the above, it is the Authority's preliminary view that it sees no reasons why it should deviate from it original assessment on these points.

3.1.   Article 61 paragraphs (2) or (3) of the EEA Agreement

The Icelandic Government argued, in the initial notification, that the derogation under Article 61(2)(a) of the EEA Agreement applies to the case at hand. The intervention of the State in the housing market through the HFF is, according to the Icelandic Government, based on particular social objectives and is limited in scope. The Icelandic Government submitted that the privilege accorded to the HFF, through the implicit State guarantee on the Bonds, does not in any way benefit the HFF, but only the recipients of funding from the HFF.

Article 61(2)(a) of the EEA Agreement declares State aid compatible with the functioning of the EEA Agreement, if the aid has a social character and is granted to individual consumers, provided that such aid is granted without discrimination related to the origin of the products concerned.

In the Authority's preliminary view, this derogation is not applicable to the case at hand. The aid is granted to the HFF, which is considered to be an undertaking in the meaning of Article 61(1) of the EEA Agreement (see above in section II.1), and not directly to individual consumers. Furthermore, consumers are bound to finance their housing by the HFF, in order to enjoy favourable conditions. Consumers are not free to benefit from State aid by their own choice of financial institution. Hence, the State aid is not granted without discrimination related to the origin, in this case, of the service concerned. Therefore, the aid is not neutral with respect to the operators in the market for house financing (31).

With regard to the other derogations mentioned in Article 61, paragraphs (2) and (3), of the EEA Agreement, the Authority takes the preliminary view that none of them are relevant to the case at hand. For example, although it is one of the objectives of the HFF to ensure territorial cohesion, it is not its primary goal to serve as an instrument for regional development. The HFF system is based on the universality objective and grants housing finance under the same conditions throughout Iceland, regardless of the region.

3.2.   Article 59(2) of the EEA Agreement

State aid may be declared compatible with the EEA Agreement under Article 59(2) of the EEA Agreement (32) if it is necessary to the operation of the services of general economic interest and does not affect the development of trade to such an extent as would be contrary to the interests of the Contracting Parties.

The following conditions must be satisfied in the present case, in order for Article 59(2) of the EEA Agreement to apply:

In the context of assessing the HFF system under Article 59(2) of the EEA Agreement, the Authority will also apply Chapter 18C of the State Aid Guidelines. The purpose of Chapter 18C is to spell out the conditions under which State aid can be found compatible with the functioning of the EEA Agreement pursuant to Article 59(2) of the EEA Agreement.

As stated in point 24 of section 18C.5 of the State Aid Guidelines, Chapter 18C will apply as of the day of adoption by the Authority. The Authority adopted Chapter 18C on 20 December 2005. Furthermore, point 25 of section 18C.5 of the State Aid Guidelines states:

‘The Authority will apply the provisions of these guidelines to all aid projects notified to it and will take a decision on those projects after adoption of the guidelines, even if the projects were notified prior to adoption. In case of non-notified aid, the Authority will apply:

Thus, the Authority will take Chapter 18C of the State Aid Guidelines into account in its future assessment (33).

3.2.1.   Definition of service of general economic interest and entrustment

The concept of service in the general economic interest means, among other things, that the State assigns ‘particular tasks’ to an undertaking (34). In order to qualify for classification as service of general economic interest, a service must have certain characteristics, the most important of which is that the service provided can not be provided in the same manner on the market and that the service should be clearly defined (35).

As an exception to the main rule in Article 59(1) of the EEA Agreement (36), the concept of ‘services of general economic interest’ must be interpreted restrictively (37) and applies only to activities of direct benefit to the public. Still, States remain free, in principle and where no common policy is established, to designate which services they consider to be of general economic interest and to organize these services as they see fit, subject to the rules of the EEA Agreement and the specific conditions laid down in Article 59(2) of the EEA Agreement (38). States may take account of objectives pertaining to their national policy when defining the service of general economic interest which they entrust to certain undertakings (39). Thus, the competence to define such services lies with the States, subject to scrutiny by the Authority. This scrutiny must essentially be conducted on a case-by-case basis.

In this assessment, the nature of the undertaking entrusted with the service is not of decisive importance, nor whether the undertaking is entrusted with exclusive rights, but rather the essence of the service deemed to be of general economic interest and the special characteristics of this interest that distinguish it from the general economic interest of other economic activities (40). In conducting such analysis the Authority has to consider the nature of the service, as well as the extent to which the same service is provided by the market on the same conditions, and in the case of a universal service, particularly, the State's legitimate objective to ensure continuity of service on acceptable conditions throughout its territory (41).

As mentioned above (in section I.3.2), the HFF granted, at the time the annulled Decision was adopted, loans in the form of general loans, additional loans and loans for rental housing. The annulled Decision accepted all three lending activities as services of general economic interest.

The relevant part of the annulled Decision reads as follows:

‘In this respect, the so-called “Husbanken-case” is of importance, as it also concerned the relationship between Article 59(2) of the EEA Agreement and State aid to a public undertaking with a view to provide cheap housing loans [...]. In that case, the EFTA Court found that the services concerned were covered by Article 59(2) of the EEA Agreement, since the services concerned were specifically defined by Norway, limited to certain categories of houses and available to everyone on an equal basis. That the loans in the “Husbanken-case” were not restricted to people in weak financial situations could not, as had been argued by the applicant, lead to another result.

The Icelandic housing policy dates back more than 50 years and is based on the political goal to encourage private home ownership. To this end, public intervention in the Icelandic housing market has been aimed at making private housing affordable to a bigger proportion of the public. The HFF is the financing instrument whereby the Icelandic State pursues its public housing policy objectives. The Housing Act [...] entrusts the HFF with the management and implementation of the housing affairs and lays down in detail the tasks of the HFF, the objectives and the HFF's financing mechanisms. The Icelandic State uses the HFF to channel capital to the housing sector and to provide house financing on more advantageous terms than are available on the open Icelandic capital market. The HFF is obliged to provide house financing at affordable tariffs and on equal conditions, irrespective of the profitability of individual operations [...].

The loan system is available to everyone on equal terms and applies to the entire territory of Iceland, including sparsely populated areas, where asset evaluations differ compared to more densely populated areas. Thus, the HFF provides a universal service throughout Iceland on equal conditions. No private credit institution would be in the position to offer mortgage secured loans on equal conditions throughout the entire territory of Iceland. Asset evaluations differ between the Reykjavik area and sparsely populated areas. Prices and securities in real estate differ depending on where the dwelling is located in Iceland. In the Authority's opinion, this aim to correct regional imbalances must be considered as a task of general economic interest in the sense of Article 59(2) of the EEA Agreement both for the so-called additional loans and for the general loans.

The HFF's loan system contains also certain social dimensions. This is of course especially so for the additional loans. However, as the HFF loans will continue to be subject to a lending cap in the form of a maximum amount available, also the general loans entail a social element. These loans aim at financing housing that corresponds to the price of average apartments in Iceland. The HFF's loans alone will not be sufficient to finance high priced property. The relative advantage to house owners, due to the cheap loans that the HHF can offer, is accordingly inversely proportionate to the amounts they wish to loan and thereby, also to the price of the house. In this respect, the Authority has no reason to contest the notified increase in lending terms, since this increase is necessary to, inter alia, take account of inflation in housing prices in recent years.

Additionally, the Icelandic Government has introduced a new provision to the effect that HFF's loans will be limited to two dwellings for each applicant. In exceptional circumstances, a loan for a third dwelling could be authorised, but it would be up to the Board of Directors to define the precise rules for such an exception.

In light of the above, the Authority concludes that the HFF is entrusted with services of general economic interest, given their social and universal dimension, distinguishable from the economic interest of other economic activities, within the meaning of Article 59(2) of the EEA Agreement.’

SBV's application to the EFTA Court, concerning doubts as to whether HFF loans could qualify as a service of general economic interest, was limited to the general loans scheme. The EFTA Court consequently limited its review on the general loans and did not address the other two loan schemes.

With regard to the question, whether the HFF general loans scheme could qualify as a service of general economic interest, the EFTA Court held:

‘The tasks of the HFF are defined in the Housing Act and further laid down by Regulations and ministerial decisions. The HFF general loans system is intended to promote security and equal rights as regards housing in Iceland by providing loans on manageable terms to the general public throughout the territory of Iceland and thereby foster private home ownership. This goes beyond the normal economic interest of operators in the financial sector. A service with this objective may qualify as a service of general economic interest justifying State aid, provided that the service fulfils the requirements laid down in Article 59(2) EEA. In that respect, the presumptions or conditions under which the HFF system operates (cf. Case E-4/97 Husbanken II, at paragraph 48) will be addressed below.’ (42)

When the EFTA Court later turned in its judgment to the presumptions or conditions under which the HFF system operates, it held:

‘[...] it is necessary to address the question of whether the conditions under which the loans were granted did not go beyond what was necessary for HFF to perform the tasks entrusted to it. The Court recalls that the ultimate aim of the State's intervention in lending services through the general loans scheme is to foster private home ownership in Iceland through lending on “manageable terms”. A service rendered with such an objective may, as has been stated above, be considered legitimate under Article 59(2) EEA. However, ESA has to make sure that public intervention does not, in reality, pursue other goals than those defined by Icelandic law or exceed what is necessary to achieve the defined goal.

In that regard, the Court notes that unlike the cost and size limitations practiced by the Norwegian Husbanken in Case E-4/97 Husbanken II, the HFF's relative and absolute lending caps do not limit the subsidised lending scheme to dwellings which fulfil certain criteria. They only limit the amount one may borrow from the HFF for any dwelling, regardless of the value or size of that dwelling. There is no limit as to how big or valuable a dwelling may be and still be eligible for a general loan under the HFF scheme; there are only limits to how much the HFF may grant as a general loan.

Moreover, the HFF general loans scheme is not limited to the financing of one unit of residential housing for each borrower. This means that in principle the system may provide financing for houses or apartments build or purchased for investment purposes. In 2004, a general limit of two units was introduced. As the Government of Iceland has pointed out, there may be social policy reasons why certain persons need to own more than one unit. The provision of more than one loan to the same person has not, however, been made dependent on that person fulfilling any criteria relating to such reasons.

These features mean that in principle the HFF general loans scheme provides subsidised financing, up to a certain limit, for any house or apartment regardless of size and value, and also for construction or purchase of residential units for investment purposes. The scheme is not formally limited to assisting the average citizen in financing his or her own dwelling. Even if it may be so that few people have in fact exploited these features of the system, they raise questions under Article 59(2) EEA. The Court recalls in this context that the HFF scheme is intended to promote security and equal rights as regards housing by providing loans on manageable terms. Whether the above-mentioned features of the aid system at stake go beyond this is not clear. That warrants an in-depth assessment, with the opportunity for interested parties to comment. [...]’ (43)

In its initial assessment, the Authority placed emphasis on three elements, in order to qualify HFF general loans as services of general economic interest:

With regard to the first element of affordable house financing, the Authority understands that the EFTA Court did not rule out per se that State intervention in lending services through general loans, which pursues the objective of fostering private home ownership through lending on ‘manageable terms’ may be considered legitimate under Article 59(2) of the EEA Agreement. In this respect, it is also important to note that the EFTA Court clarified in its judgment that the Contracting Parties enjoy a margin of discretion in deciding what ‘manageable terms’ should mean in relation to a housing financing scheme which qualifies as a service of general economic interest (44). In this respect, it is the Authority's preliminary view that until August 2004 commercial banks in Iceland have not offered house financing on ‘manageable terms’. As confirmed in the judgment of 7 April 2006, SBV stated that its members were only from August 2004 onwards able to match the interest rate of HFF general loans (45). Concerning the element of affordable house financing, the Authority needs up-dated information on the development on the Icelandic mortgage market after the annulled Decision was taken, in order to assess to what extent commercial banks have offered mortgage secured loans on terms the Icelandic State would consider as manageable.

With regard to the second element of territorial cohesion, it is the Authority's preliminary conclusion that this element is an important factor to assess whether the HFF general loans system can qualify as a service of general economic interest. It is the Authority's opinion that SBV has not submitted any tangible evidence during the EFTA Court proceedings, which demonstrated that the commercial banks have offered and actually granted loans on ‘manageable terms’ outside the Reykjavik area during the period between 1999 and August 2004. Furthermore, in the Authority's view, SBV has submitted so far no evidence which showed that commercial banks have offered and granted loans on ‘manageable terms’ outside the Reykjavik area after August 2004.

Finally, with regard to the social element, the EFTA Court raised concerns whether the current conditions ensure that the general loans are formally limited to assisting the ‘average citizen in financing his or her own dwelling’. The EFTA Court criticized that the current features imply that in principle the HFF general loans scheme provides subsidised financing, up to a certain limit, for any house or apartment regardless of size and value, and also for construction or purchase of residential units for investment purposes. In light of the EFTA Court's conclusions on this point, doubts are raised whether the conditions for the lending services through general loans pursue a sufficiently restricted social objective.

With regard to additional loans, the Authority takes the preliminary view that these loans could be declared as services of general economic interests. Additional loans were granted to individuals with low income and limited assets for the construction or purchase of their own residential housing. Finally, concerning loans for rental housing to municipalities, associations and companies for the construction or purchase of residential housing to be rented out, the Authority takes the preliminary view that these loans might be qualified as services of general economic interests, if they pursue a sufficiently restricted social objective, in line with the concerns raised above, or if the private market is not providing for such kind of loans. To arrive at a final conclusion on these points the Authority would need up-dated information.

With regard to unlawfully granted State aid under the HFF system after the 20th of December 2005 (see above sections II.2 and II.3.2 of this Decision), it should be recalled that point 11 in section 18C.2.3 of the State Aid Guidelines requires that the responsibility for operation of the service of general economic interest must be entrusted to the undertaking concerned by way of one or more official acts, the form of which may be determined by each EFTA State. The act or acts must specify, in particular:

In the Authority's preliminary view, it is doubtful whether the HFF system complies with all of the above mentioned conditions, in particular with regard to the duration of the public service obligation and arrangements for avoiding and repaying any overcompensation.

3.2.2.   Obstruction of the performance of the particular tasks

Article 59(2) of the EEA Agreement states that the rules of the EEA Agreement (here the State aid rules) apply as long as this does not obstruct, in law and fact, the fulfilment of the task of general economic interest entrusted to the given undertaking. In other words, the derogation contained in Article 59(2) of the EEA Agreement is only applicable to the extent that it is necessary so that the undertaking in question can fulfil the task of general interest which has been conferred on it (46). This requirement of necessity is simply an expression of the principle of proportionality.

It is incumbent upon the State, which invokes Article 59(2) of the EEA Agreement, to demonstrate that this condition is met. Thus, the State must set out in detail the reasons for which, in the event of elimination of the measures, the performance of the tasks of general economic interest under economically acceptable conditions would, in its view, be jeopardized (47). However, that burden of proof cannot be so extensive as to require the EEA State to go even further and prove, positively, that no other conceivable measure could enable those tasks to be performed under the same conditions (48).

On these points, the annulled Decision stated:

‘In the Authority's view, the HFF would not be able to perform the same level of services of general economic interest, described above, without any State support. However, the above mentioned proportionality test also requires that the State support for the obligation to render a service of general economic interest must be based on the costs of such specific service. Therefore, in the following it will be assessed whether the HFF's costs to render the service of general economic interest are overcompensated and whether the State support is limited to what is necessary for the HFF to perform the specific service in question.

As stated above, the implicit State guarantee, the exemptions from taxes, the abstention from paying any dividends and the interest support imply that the HFF receives State aid in the meaning of Article 61(1) of the EEA Agreement. On the other hand, the costs for the HFF can be said to be the interest support the final consumers get as a result of the HFF's lending activities. To the extent the HFF is able to be funded at lower costs than competing financial institutions, a benefit may be said to accrue to the HFF. Correspondingly, to the extent it is obliged to lend at lower rates than competing institutions, costs may be said to be incurred. In other words, as long as the HFF's is forced to lend at rates lower than market rates, it is forced to abstain from revenue.

While the HFF can raise money cheaply because of the State guarantee, it is not free to set interest rates to the public. Until the end of June 2004 it could only charge an interest rate on its loans that was 0,35 percentage points higher than its funding rate. As tables 2 and 3 above show, this margin was clearly lower than margins charged by other financial institutions. This means that low funding costs obtained by the HFF due to the State guarantee were transferred to the final consumers.

The charge of 0,35 percentage points was supposed to cover current operational costs of the HFF, provisions for losses on loans and to provide for a certain return on equity such that the HFF sustains its activity without drawing on direct State grants. Back in 1993 the margin was fixed at 0,25 percentage points. However, it turned out that this margin was a too small to cover losses on loans. Therefore, the margin was increased to 0,35 percentage points in 1994. A new review was undertaken in 1997. It was then concluded that the 0,35 % margin would be sufficient. Looking at developments for the years from 1999 to 2002, as shown in table 1 above, it also appears that this mark-up was appropriate to cover just operating expenditures, loss provisions and to yield a certain rather modest net profit, such that equity was kept rather stable in relation to total assets. Against this background the Authority concludes that the mark-up of 0,35 percentage points was and still is appropriate to just cover these different provisions.

The changes in the lending system as of 1 July 2004 have, introduced a new cost element that needs to be assessed. As of that date, the interest margin has been increased by 25 basis points. This increase stems from the fact that the previous bond swap system has been abolished and that direct cash lending has been introduced. As the Icelandic Government has pointed out, this implies that the HFF takes on new risks related to interest rate developments. Mortgage holders will, as before, have the possibility of prepayment of loans at par while the HFF cannot redeem its obligations in the same manner. Before 1 July 2004 HFF had the possibility to prepay its funding at par. The new situation creates new risks for HFF as developments in interest rates are uncertain. A fall in interest rates will normally increase prepayments while HFF does not have an identical means of adjusting its funding.

The value, or the cost, related to this new risk is naturally uncertain. The financial consultant estimated it to be in the range of 15 to 35 basis points. The Financial Supervisory Authority and the State Guarantee Fund have called for caution when fixing the additional mark-up to cover the risk. Under these circumstances, and also taking into account the new provisions on solvency ratio according to the Rules of the Financial Supervisory Authority, the Authority can accept that the increase in the interest rate margin for HFF with 0,25 percentage points is what is necessary to cover the costs of the new risks HFF is facing.

The Authority also takes note of the statement from the Icelandic Government that HFF's interest margin shall be reviewed regularly on the basis of HFF's performance and the risks it is facing at any given time. The Icelandic Government has also stated that building up funds inside HFF beyond what is required to maintain the solvency rate of 5 % is not the policy of the Government and would run counter to the expressed policy of enabling the borrowers to gain directly from the operation of the housing lending system.

According to the Icelandic Government, a common dividend requirement for Icelandic banks is some 15 % on equity. If the HFF were to be subject to a similar dividend policy and also subject to normal taxation, the interest mark-up would need to be increased correspondingly as the current margin would not provide for any means to cover such obligations. The Icelandic Government has estimated what the necessary interest mark-up would be in such a case, taking into account an 8 % capital adequacy ratio — instead of the current 5 % — and concluded that the mark-up would increase by 65 to 80 basis points above the current level. To the extent that the HFF were subject to the same taxation and dividend requirements as commercial banks, borrowing costs would increase for the ultimate borrowers, corresponding to what the State would charge in the form of taxes and dividends. When the Icelandic Government abstains from taxes and dividends in relation to the HFF, it is just to keep interest rates for house buyers low such that the Government is able to offer the service of general economic interest, namely to provide the Icelandic population with affordable housing.

As far as direct interest support is concerned, the HFF is obliged in certain conditions to grant interest support to low income families. To some extent such support has been granted by drawing on the Fund's own equity. In other instances the HFF has received direct contributions from the State. These contributions have been transferred directly to the beneficiaries and have not left the HFF with any extra financial means.

In light of the above and as demonstrated by the Icelandic Government, the mark-up of 0,35 percentage points applicable until 30 June 2004 and the mark-up of 0,60 percentage points thereafter can be justified as an appropriate margin to cover the expenses of running the HFF. In other words, it is reasonable to assume that the benefit of the HFF's low borrowing rate is fully transferred to the final consumers. The Authority has not detected any overcompensation to the HFF. The benefits it receives are passed on to the final consumers.

In conclusion, the Authority is of the view that the HFF's costs to render the service of general economic interest are not overcompensated and that the State support is limited to what is necessary for the HFF to perform the specific service in question’.

With regard to possible doubts as to the proportionality assessment of HFF's general loans, the EFTA Court held:

‘[...] This must include an assessment of whether the subsidised HFF general loans scheme is a suitable means of attaining its objective. There is no reason why a service which is not suitable to meet its aim should benefit from a derogation from the EEA rules. Furthermore, this also calls for an analysis of whether the HFF, or a different provider, could have provided loans at the same “manageable terms” as the HFF provided at the relevant time without, or with less State aid.

Firstly, with regard to suitability, the Applicant has claimed that the low interest rate on HFF general loans has led to a general increase in prices for houses and apartments which neutralises the effects of the low interest rates, since purchasers need to borrow more money in order to buy a certain house or apartment than they would have had to with lower prices.

The Court does not find it doubtful that the low interest rate on HFF general loans did not lead to price increases which completely neutralised the effect of the low interest rate. With respect to any lesser effect on housing prices, regard must be had to the margin of discretion which the Contracting Parties must enjoy in deciding what “manageable terms” should mean in relation to a housing financing scheme which qualifies as a service of general economic interest. As a consequence, the Contracting Parties must also enjoy a margin of discretion in deciding what constitutes a sufficient effect of the low interest rates on the real burden on borrowers' economy. In the end, it is this burden that borrowers have to be able to manage. For that reason, as long as it is not established that the effect of the low interest rate on HFF general loans is completely neutralised by an increase in housing prices, the HFF general loan scheme must be considered suitable to meet its aim.

Secondly, as to the question of whether there were doubts that neither the HFF, nor a different provider, could have provided loans at the same “manageable terms” at the relevant time without, or with less, State aid, the Court recalls that the interest rates charged by the HFF for its general loans are calculated on the basis of its funding costs, with an added margin set by the Minister of Social Affairs. This margin was set at 0,6 percentage points from 1 July 2004, up from 0,35 percentage points. The funding costs consist mainly in the interest paid on bonds issued by the HFF. In this context, the HFF benefits from the State guarantee which follows from the State's unlimited liability for the HFF's debts as its owner.

The Court does not find it doubtful that the State aid provided to the HFF system did not go beyond what was necessary in the case at hand to allow the HFF to cover expected losses and operate the general loans system under economically acceptable conditions (see, for comparison, Case C-157/94, Commission v Netherlands [1997] ECR I-5699, at paragraphs 52 and 53). This does not mean, however, that the general loans system as operated by the HFF is necessarily compatible with the EEA Agreement.

With regard to the ability of any other provider to supply the same service as the HFF, but without State support, the Court recalls that Contracting Parties must be allowed a margin of discretion with regard to what exactly should be considered affordable terms in relation to such schemes. In this regard, a Contracting Party cannot be bound to what other Contracting Parties, in leaving this kind of housing financing completely to the market, implicitly consider acceptable. The Court does not find that it has been demonstrated that doubts existed as to whether the regular banks did match the HFF interest rate level on comparable loans in any part of Iceland prior to the annulled Decision, or would have been able to do so without State support. Indeed, the Applicant has stated that it was only from August 2004 onwards that the banks were able to match the interest rate of HFF general loans.

Neither does the Court find that it has been demonstrated that doubts existed as to whether an alternative model for State-supported housing financing through the banks, the so-called “whole-sale alternative”, would enable the banks to provide the same loans as the HFF were providing at the relevant time without this support constituting State aid, or with less State aid and without the risk of cross-subsidisation.’ (49)

The Court endorsed the Authority's initial assessment that there were no doubts that the commercial banks did not match the HFF interest rate level on comparable loans in any part of Iceland prior to the annulled Decision, or would have been able to do so without State support. SBV itself stated that it was only from August 2004 onwards that commercial banks were able to match the interest rate of HFF general loans. With regard to the developments on the Icelandic mortgage market after the annulled Decision was taken, the Authority would require up-dated information, in order to assess to what extent commercial banks have offered loans on terms that the Icelandic State would consider ‘manageable’.

Should the Authority's assessment reveal that commercial banks have offered loans in the Reykjavik area since August 2004 on terms that the Icelandic State would consider ‘manageable’, concerns could be raised as to what extent the HFF needs to offer general loans within the Reykjavik area, in order to enable the HFF to grant general loans outside the Reykjavik area.

With regard to alternative models to the HFF system, it is the Authority's preliminary view that the presented models do not seem to be less distortive to competition.

With regard to unlawfully granted State aid under the HFF system after the 20th of December 2005 (see above sections II.2 and II.3.2 of this Decision), it should be recalled that point 18 in section 18C.2.4 of the State Aid Guidelines states that ‘[w]hen a company carries out activities falling both inside and outside the scope of the service of general economic interest, the internal accounts must show separately the costs and receipts associated with the service of general economic interest and those associated with other services, as well as the parameters for allocating costs and revenues’.

Furthermore, point 19 in section 18C.3 of the State Aid Guidelines states that ‘... EFTA States must check regularly, or arrange for checks to be made, to ensure that there has been no over-compensation’.

Without prejudice to the Authority's final Decision in the present case, for any HFF services which might fall outside the scope of services of general interest, the HFF would be required to comply with the above mentioned accounting requirements.

3.2.3.   Development of trade and the interest of the Contracting Parties

Article 59(2) of the EEA Agreement further involves an assessment of whether the specific service in question affects the development of trade to an extent contrary to the interests of the Contracting Parties (50). The Authority is charged with striking a balance between the right of Iceland to invoke the derogation and the interest of the Contracting Parties to avoid distortions of competition and restrictions to the ‘four freedoms’ (51).

This entails that it must be established that the performance of the service of general economic interest does not affect competition and unity of the market established by the EEA Agreement in a disproportionate manner. It is, however, not required that the measures adopted be the least restrictive possible (52). Rather, the test is of a negative nature: it examines whether the measure adopted is not disproportionate (53). This ‘negative test’ has once more been confirmed by the EFTA Court in its ruling of 7 April 2006 (54). A reasonable relationship between the aim and the means employed is satisfactory (53). Thus, the Authority does not have competence to strike down a measure that otherwise fulfils Article 59(2) of the EEA Agreement simply because the measure might, in some minor aspects and details, go further than what is strictly necessary to fulfil the aims behind it. It is for the States to define their policies and organize general interest services, leaving the Authority no power to take a position on the organization and scale of the service or the expediency of the political choice made. Even if it were successfully shown that the scheme in question were not an optimally efficient one, this alone would not lead to the conclusion that the distortive effects are necessarily disproportionate to the goals assigned.

On this point, the Authority concluded in its annulled Decision:

‘The EEA Agreement establishes inter alia the general principles, both applicable to financial services, of the right of establishment for nationals of the EEA States and their freedom to provide services within the territory of the Contracting Parties. However, the secondary legislation which, under the EC Treaty and the EEA Agreement, has been adopted to make these basic provisions effective, does not extend to specialised housing finance institutions like the HFF( (55)). Consequently, such institutions are at present not able to benefit from the principles of mutual recognition and home country control contained in the banking legislation of the EEA Agreement. Therefore, due to different national credit rules and practices and the absence of effective harmonisation or mutual recognition at EEA level for such institutions, there continue to be considerable obstacles to effective cross-border operations in this area.

In most developed countries, including most parties to the EEA Agreement, Governments, both at central and local level, intervene in housing and housing finance markets. This intervention takes different forms from one State to another, depending, inter alia, on certain realities in the housing markets, in particular the pattern of housing tenure, and the objectives of the housing policy of the Governments concerned. There is, for instance, likely to be a relationship between the extent to which private individuals' home ownership is an objective of public housing policy and the scope of intervention by the Government concerned in housing finance; a Government that sees it as an important objective to its housing policy that as many households as possible own their own dwelling, like in Iceland, is likely to want to support the financing of such investments on a broad scale.

As already stated above, the Authority considers long-term house financing for residential accommodation to be the relevant market for the assessment in the present case.

As submitted by the Icelandic Government, the Icelandic market for mortgage loans is largely divided between three main actors. These are the HFF, the pension funds and other private credit institutions. The HFF had, in 2002, a market share of approximately 78 % of that market. The market share of pension funds was, in 2002, approximately 17 %. The remaining 5 % was taken by private credit institutions. The Icelandic Government submitted figures showing that the HFF had, in 2002, a total amount of ISK 382 billion in mortgage loans, compared to ISK 84 billion of the pension funds and ISK 27 billion of private banks (56).

The granting of loans for financing purchases of residential accommodation is a financial service which, in the present market conditions, is predominantly of a local character and normally does not involve any direct cross-border transactions. Distortion of competition arising from financial advantages accorded to the HFF operating such services are therefore prima facie likely to have only limited direct trade effects.

The HFF is not entitled to grant any loans for the financing of dwellings outside Iceland. The HFF's activities are, as laid down in the Housing Act, targeted exclusively towards promoting Icelandic housing policy.

Today no foreign banks are granting cross-border mortgage loans in ISK to Icelandic households. Furthermore, there are currently no foreign financial institutions or representative offices of foreign financial institutions in Iceland. The Icelandic economy is very limited in size. The limited number and small size of transactions in trade in the foreign exchange markets of the ISK warrants only limited interest from foreign banks. The special geography and the scattered population outside the Reykjavik area further reduces the foreign interest for lending to the Icelandic housing market. That foreign banks do not even operate representative offices in Iceland underpins the lack of interest in the Icelandic financial market. In the absence of any “flourishing” financial activities of foreign banks on the Icelandic market outside the particular market for long term housing loans, it can therefore hardly be argued that it is the State aid to the HFF which prevents foreign banks from entering the Icelandic financial market.

In the light of the above, given the limited size of the Icelandic housing market, with its special geographic and demographic features, the Authority is of the opinion that the HFF's financing mechanism does not affect the development of trade to an extent contrary to the interests of the Contracting Parties.’

With regard to the assessment of whether HFF general loans did not affected the development of trade contrary to the interest of the Contracting Parties, the EFTA Court held:

‘As part of the assessment of whether the scheme did not affect the development of trade to such an extent as would be contrary to the interest of the Contracting Parties, the relevant market must be defined. ESA considered “long-term house financing for residential accommodation” to be the relevant product market (see section II point 3.2.3 of the annulled Decision). It is not obvious to the Court that the assessment should be limited in scope in this way, excluding the possible effects of the aid granted to the HFF on other parts of the EEA internal market, in particular the financial markets. For that reason, the definition of the relevant market in this particular case is also an issue which interested parties ought to be able to comment upon in a formal investigation procedure. The further assessment of the consequences of the HFF general loan system on the development of trade will depend to a considerable extent on the definition of the relevant market which the formal investigation procedure will lead to.’ (57)

In light of the EFTA Court's conclusions on this point, the Authority would require for its further assessment information as to what extent the aid granted to the HFF could affect other parts of the EEA internal market, in particular other financial markets, such as, for example, the private lending market.

3.3.   Conclusion

Doubts are raised, in light of the EFTA Court's ruling of 7 April 2006, whether the HFF system, partly or in its entirety, can be declared compatible with the State aid rules, according to Article 59(2) of the EEA Agreement.

4.   Recovery

According to Article 14(1) in Part II of Protocol 3 to the Surveillance and Court Agreement, ‘[w]here negative decisions are taken in cases of unlawful aid, the EFTA Surveillance Authority shall decide that the EFTA State concerned shall take all necessary measures to recover the aid from the beneficiary (hereinafter referred to as a “recovery decision”). The EFTA Surveillance Authority shall not require recovery of the aid if this would be contrary to a general principle of EEA law’.

In other words, any unlawful aid which cannot be declared compatible with the State aid rules will be subject to recovery. In case of recovery, it is the Authority's preliminary view that, in the case at hand, no legitimate expectations could be invoked, which would preclude the recovery.

According to settled case-law, ‘[...] undertakings to which an aid has been granted may not, in principle, entertain a legitimate expectation that the aid is lawful unless it has been granted in compliance with the procedure laid down in that article. A diligent businessman should normally be able to determine whether that procedure has been followed’ (58).

However, a recipient of illegally granted aid is not precluded from relying on exceptional circumstances on the basis of which it had legitimately assumed the aid to be lawful and thus declining to refund that aid (59). Because the aid at stake was not notified in advance, it is necessary to examine whether the Authority's favourable Decision No 213/04/COL, which approved the HFF system, is to be regarded as an ‘exceptional circumstance’ within the meaning of the case-law referred to. Such an assessment must be made in the light of the purpose of the protection of legitimate expectations.

In the Authority's view, the judicial review by the Community Courts or the EFTA Court of decisions concerning State aid cannot be regarded as an exceptional and unforeseeable event, forming as it does an integral and essential part of the system established by the EC Treaty and the corresponding provisions in the EEA Agreement and the Surveillance and Court Agreement for that purpose. A diligent businessman should be well aware of the fact that a decision, to the effect that a State measure is declared compatible, is, within the time-limit of two months referred to in Article 230 EC and Article 36 of the Surveillance and Court Agreement, liable to be challenged before the Community Courts or the EFTA Court.

The Court of Justice itself has, moreover, and indeed recently, stated that ‘[...] in view of the mandatory nature of the supervision of State aid by the Commission under Article 88 EC, undertakings to which aid has been granted cannot, in principle, entertain a legitimate expectation that the aid is lawful unless it has been granted by the procedure laid down in that article [...] It follows that so long as the Commission has not taken a decision approving aid and so long as the period for bringing an action against such a decision has not expired, the recipient cannot be sure as to the lawfulness of the proposed aid which alone is capable of giving rise to a legitimate expectation on his part’ (60).

Subsequently, to the same effect, in Spain v Commission, the Court made it clear that ‘[t]he fact that the Commission initially decided not to raise any objections to the aid in issue cannot be regarded as capable of having caused the recipient undertaking to entertain any legitimate expectation since that decision was challenged in due time before the Court, which annulled it. However regrettable it may be, the Commission's error cannot erase the consequences of the unlawful conduct of the Kingdom of Spain’ (61).

Any argument to the contrary would render ineffective the review conducted by the Community judicature and the EFTA Court of the legality of a positive State aid decisions. If it were to be concluded that such a decision automatically gives rise to legitimate expectations on the part of the recipients, competitors of those recipients or other third parties harmed by the decision would have no interest in attacking the vitiated measure. That is because any annulment of a positive State aid decision would ultimately become a ‘pyrrhic victory’, since the negative effects of the decision could never be eliminated (62).

The Authority, therefore, preliminarily considers that the adoption of a favourable decision by the Authority regarding aid cannot in itself be regarded as an event which causes the recipient of that aid to entertain legitimate expectations as to its lawfulness.

5.   Conclusion

It is the Authority's preliminary conclusion that the HFF system constitutes unlawful aid on procedural grounds. Doubts are raised whether the HFF system, either partly or in its entirety, can be declared compatible with the State aid rules, according to Article 59(2) of the EEA Agreement. Any unlawful aid which ultimately will be declared incompatible with the State aid rules will be subject to recovery.

HAS ADOPTED THIS DECISION:

Done at Brussels, 21 June 2006

For the EFTA Surveillance Authority

B. T. GRYDELAND

President

K. JAEGER

College Member

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(1)  Hereinafter referred to as ‘the EEA Agreement’.

(2)  Hereinafter referred to as ‘the Surveillance and Court Agreement’.

(3)  The cartouche of this Decision is published in OJ 2005 C 112, page 8. The cartouche makes reference to the EFTA Surveillance Authority's website, where the non-confidential full text of the Decision is available: www.eftasurv.int/fieldof work/fieldstateaid/stateaidregistry/

(4)  Judgment of 7 April 2006, Case E-9/04 The Bankers' and Securities' Dealers Association of Iceland v EFTA Surveillance Authority [2006] EFTA Court Report (not yet reported). The judgment is available at the EFTA Court's website: www.eftacourt.lu

(5)  Procedural and Substantive Rules in the Field of State Aid (hereinafter referred to as the ‘State Aid Guidelines’), adopted and issued by the Authority on 19 January 1994, published in OJ 1994 L 231. The State Aid Guidelines are available on the Authority's website: www.eftasurv.int

(6)  The Icelandic Government provided English translations of these laws. Quotes from these laws in this decision are based on the translation provided by the Icelandic Government.

(7)  The cartouche of this Decision is published in OJ 2005 C 112, page 8. The cartouche makes reference to the EFTA Surveillance Authority's website, where the non-confidential full text of the Decision is available: www.eftasurv.int/fieldof work/fieldstateaid/stateaidregistry/.

(8)  Judgment of 7 April 2006, Case E-9/04, cited above.

(9)  The Housing Act was amended by Act No 57/2004. Act No 57/2004 entered into force on 1 July 2004, except for Temporary Provision I, which entered into effect immediately (see Article 22 of Act No 57/2004).

(10)  As amended, and various regulations, inter alia, Regulation No 544/2004 on ‘the Financing and Risk Management of the Housing Financing Fund’, Regulation No 522/2004 on ‘Borrowers' Mortgages and HFF Bonds’ and Regulation No 521/2004 on ‘Loan Proportions and Maximum Amounts of Borrowers' Mortgages’.

(11)  Section XII of the Housing Act. For example, according to Article 52 of the Housing Act, Act. No 97/1993 on the State Housing Board was repealed.

(12)  Article 53 of the Housing Act merged the State Housing Fund and the Workers' Building Fund and transferred the rights, assets, liabilities and obligations of these two funds to the HFF.

(13)  The above wording reflects the situation prior to 1 July 2004, i.e. prior to the entering into force of Act No 57/2004. Article 10 of the Housing Act was amended by Article 4 of Act No 57/2004. According to this amendment, the HFF finances its tasks with the income from the fund's equity capital (i.e. the payments, interest and indexation of granted loans), by issue and sale of HFF bonds and by borrowing as provided for in the Budget Act at any particular time and by service charges as provided for in Article 49.

(14)  This is the wording prior to 1 July 2004. After that date Article 5 of Act No 57/2004 amended Article 11 of the Housing Act and, inter alia, changed the title of that Article to: Management of Assets and Liabilities (this translation has been provided by the Icelandic Government).

(15)  This translation was provided by the Icelandic Government.

(16)  NFS, 10 May 2006.

www.visir.is/apps/pbcs.dll/article?AID=/20060510/FRETTIR01/60510079/1091

(17)  Case C-118/85 Commission v Italy [1987] ECR 2599; Case C-41/90 Klaus Höfner and Fritz Elser v Macrotron GmbH [1991] ECR I-1979; Case C-69/91 Decoster [1993] ECR I-5335. See similar Case E-4/97 Norwegian Bankers' Association v EFTA Surveillance Authority [1999] Report of the EFTA Court, page 3, paragraph 30.

(18)  Case C-280/00 Altmark Trans GmbH [2003] ECR I-7747.

(19)  With regard to the question whether the HFF is actually entrusted with public service obligations, see the discussion below in section II.3.2.1.

(20)  The Icelandic Government referred in this context to Directive 2000/12/EC on credit institutions.

(21)  Directive 2000/12/EC of the European Parliament and the Council of 20 March 2000 relating to the taking up and pursuit of the business of credit institutions (OJ L 126, 26.5.2000, p. 1), as amended.

(22)  The adaptation text mentioned in point 14(a) of Chapter II(i) of Annex IX to the EEA Agreement.

(23)  This translation has been provided by the Icelandic Government.

(24)  Case C-379/98 PreussenElektra AG v Schleswag [2002] ECR I-2099.

(25)  Case C-44/93 Namur-Les Assurances du Crédit SA [1994] ECR I-3829, paragraph 28.

(26)  Furthermore, Article 4(1), first sentence, of the Authority's Decision No 195/04/COL of 14 July 2004 states that ‘[f]or the purposes of Article 1(c) in Part II of Protocol 3 to the Surveillance and Court Agreement, an alteration to existing aid is any change, other than modifications of a purely formal or administrative nature which cannot affect the evaluation of the compatibility of the aid measure with the common market’.

(27)  The European Commission Decision No 2005/842/EC of 28 November 2005 on the application of Article 86(2) EC (which corresponds to Article 59(2) of the EEA Agreement) to State aid in the form of public service compensation granted to certain undertakings entrusted with the operation of services of general economic interest (OJ L 312, 29.11.2005, page 67) lays down the conditions under which certain types of public service compensation constitutes State aid compatible with Article 86(2) EC and exempts compensation satisfying those conditions from the prior notification requirement. The Decision has not yet been incorporated into the EEA Agreement. Public service compensation which constitutes State aid and does not fall within the scope of Decision No 2005/842/EC will still be subject to the prior notification requirement, also after that Decision has been incorporated into the EEA Agreement. In any event, it should be noted that, with regard to house financing, Article 2(1)(b) of Commission Decision No 2005/842/EC only exempts public service compensation granted to social housing undertakings. Recital 16 of Commission Decision No 2005/842/EC further specifies that social housing undertakings should be understood as meaning ‘... undertakings in charge of social housing providing housing for disadvantaged citizens or socially less advantaged groups, which due to solvability constraints are unable to obtain housing at market conditions...’.

(28)  Since the Authority's Decision No 213/04/COL was annulled by the EFTA Court's judgment of 7 April 2006 in Case E-9/04, the aid granted under the HFF system remains unlawful aid.

(29)  With regard to the relationship between the State aid rules and the provisions of the ‘four freedoms’, see for example Case 74/76 Ianelli & Volpi v Meroni [1977] ECR 557.

(30)  Case E-9/04, cited above, paragraph 82.

(31)  See similar Case E-4/97, cited above, paragraph 30.

(32)  Which corresponds to Article 86(2) EC.

(33)  Since the Authority's Decision No 213/04/COL was annulled by the EFTA Court's judgment of 7 April 2006 in Case E-9/04, the aid granted under the HFF system remains unlawful aid (see above section II.2).

(34)  See for example: Case 10/71 Muller [1971] ECR 723; Case 127/73 BRT v SABAM [1974] ECR 313; Case 7/82 GVL [1983] ECR 483; Case C-393/92 Almelo [1994] ECR I-1520; Case C-266/96 Corsica Ferries [1998] ECR I-3949.

(35)  Communication from the Commission — Services of General Interest in Europe (OJ C 17, 19.1.2001, p. 7), see paragraph 14 (hereinafter referred to as ‘Services of General Interest’).

(36)  The main rule in Article 59(1) of the EEA Agreement states that in the case of public undertakings and undertakings to which EC Member States or EFTA States grant special or exclusive rights, the Contracting Parties shall ensure that there is neither enacted nor maintained in force any measure contrary to the rules contained in the EEA Agreement, in particular to those rules provided for in Articles 4 and 53 to 63.

(37)  See Case C-242/95 GT-Link A/S v De Danske Statsbaner [1997] ECR I-4449, paragraph 50; Case T-260/94 Air Inter [1997] ECR II-147, paragraph 135; Case C-159/94 Commission v France [1997] ECR I-5815, paragraph 53.

(38)  See in this context for example: Services of General Interest, cited above, paragraph 22; Case T-106/95 FFSA [1997] ECR II-229, paragraph 192. As stated by Advocate General Léger in his opinion in Case C-438/02 Åklagaren v Krister Hanner [2005] ECR I-4551, paragraph 139: ‘...it falls to the Member States to define the content of their services of general economic interest and, in so doing, they enjoy considerable leeway since the Court and the Commission will intervene only in order to penalise manifest errors of assessment’.

(39)  Case E-9/04, cited above, paragraph 67.

(40)  Case E-4/97, cited above, paragraph 47.

(41)  See in this context: Report of the European Commission to the Council of Ministers: Service of general economic interest in the banking sector (adopted by the Commission on 17.6.1998 and presented to the ECOFIN Council on 23.11.1998). Services of General Interest, cited above, paragraph 10.

(42)  Case E-9/04, cited above, paragraph 68.

(43)  Case E-9/04, cited above, paragraphs 76 to 79.

(44)  Case E-9/04, cited above, paragraph 71. See in this context also below section II.3.2.2 of this decision.

(45)  Case E-9/04, cited above, paragraph 74.

(46)  See Case C-41/90, cited above, paragraph 24; and Case C-242/95, cited above, paragraph 54.

(47)  It is not necessary that the survival of the undertaking itself be threatened. See Case C-157/94 Commission v The Netherlands [1997] ECR I-5699, paragraph 43.

(48)  See Case C-159/94 Commission v France [1997] ECR I-5815, paragraphs 94 to 107.

Case E-4/97, cited above, paragraph 62.

(49)  Case E-9/04, cited above, paragraphs 69 to 75.

(50)  In this context, it is interesting to note the opinion of Advocate General Léger in Case C-438/02, cited above, paragraph 143: ‘Finally, the last condition in Article 86(2) EC requires that “[t]he development of trade must not be affected to such an extent as would be contrary to the interest of the Community”. Even though the Court has not yet ruled on the meaning of that requirement, certain Advocates General have already adopted a position on the issue. In their view, effect on the development of intra-Community trade within the meaning of Article 86(2) EC, unlike the classic definition of the concept of “measures having an effect equivalent to a quantitative restriction”, calls for proof that the measure in issue has in fact had a substantial effect on intra-Community trade. That assessment does seem to me to be supported by the wording of Article 86(2) EC’.

(51)  See similar Case E-4/97, cited above, paragraph 70.

(52)  See for example: Case C-159/94, cited above; Case C-158/94 Commission v Italy [1997] ECR I-5789; Case C-157/94, cited above; Case E-9/04, cited above, paragraph 80.

(53)  Case E-4/97, cited above, paragraph 62.

(54)  Case E-9/04, cited above, paragraph 80.

(55)  See similar Case E-4/97, cited above, paragraph 63.

(56)  Sources: The Central Bank of Iceland and the HFF.

(57)  Case E-9/04, cited above, paragraph 81.

(58)  Case C-5/89 Commission v Germany [1990] ECR I-3437, paragraph 14; Case C-169/95 Spain v Commission [1997] ECR I-135, paragraph 51.

(59)  Case C-5/89, cited above, paragraph 16.

(60)  Case C-91/01 Italy v Commission [2004] ECR I-4355, paragraphs 65 and 66.

(61)  Case C-169/95 Spain v Commission [1997] ECR I-135, paragraph 53.

(62)  See in this context: Opinion of Advocate General Tizzano delivered on 9 February 2006 in Joined Cases C-442/03 P and C-471/03 P P&O European Ferries (Vizcaya) SA and Diputacion Foral de Vizcaya v Commission (not yet reported), paragraphs 146 to 158.

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Výzva na predloženie pripomienok podľa článku 1 ods. 2 v časti I protokolu 3 k Dohode o dozore a súde ku kompenzácii zvýšených odvodov sociálneho zabezpečenia udelenej „spoločnostiam Hurtigrutenu“ (prípad č. 56343)

(2006/C 314/14)

Rozhodnutím 215/06/COL z 5. júla 2006, ktorého text nasleduje v autentickom jazyku za týmto zhrnutím, začal Dozorný orgán EZVO konanie podľa článku 1 ods. 2 časti I protokolu 3 k Dohode medzi štátmi EZVO o zriadení dozorného orgánu a súdneho dvora (dohoda o dozore a súde). Nórska vláda bola informovaná prostredníctvom kópie tohto rozhodnutia.

Dozorný orgán EZVO týmto oznamuje štátom EZVO, členským štátom EÚ a zainteresovaným stranám, že môžu predložiť svoje pripomienky k príslušnému opatreniu do jedného mesiaca od uverejnenia tohto oznámenia na adresu:

Pripomienky budú oznámené nórskej vláde. Zainteresované strany môžu písomne s uvedením dôvodov požiadať o dôverné nakladanie s informáciami o ich totožnosti.

ZHRNUTIE

Dozorný orgán EZVO (ďalej len „orgán“) zaslal 2. augusta 2004 nórskym orgánom žiadosť o informácie týkajúce sa potenciálnych platieb spoločnostiam Ofotens og Vesteraalens Dampskibsselskap ASA a Troms Fylkes Dampskibsselskap ASA (ďalej len „spoločnosti Hurtigrutenu“).

Po rozsiahlej výmene korešpondencie medzi orgánom a nórskymi orgánmi orgán 5. júla 2006 rozhodol o začatí konania vo veci formálneho zisťovania v súvislosti s platbou spoločnostiam Hurtigrutenu.

Spoločnosti Hurtigrutenu poskytujú služby námornej dopravy pozostávajúce z kombinovanej dopravy osôb a tovaru pozdĺž pobrežia z Bergenu do Kirkenes. Od 1. januára 2002 do 31. decembra 2004 boli tieto služby predmetom dohody medzi nórskymi orgánmi a spoločnosťami Hurtigrutenu, pokiaľ išlo o poskytovanie námorných služieb pozdĺž nórskeho pobrežia.„Dohoda z Hurtigrutenu“ bola notifikovaná orgánu zo strany nórskych orgánov v júli 2000 a následne bola orgánom schválená 19. decembra 2001. Samotné služby poskytované spoločnosťami Hurtigrutenu sú čiastočne komerčne životaschopné, najmä počas letného obdobia, pričom v zimnom období vo všeobecnosti komerčne životaschopné nie sú. Orgán vo svojom rozhodnutí z roku 2001 považoval kompenzáciu v rámci dohody z Hurtigrutenu za povolenú podľa článku 59 ods. 2 Dohody o EHP, keďže služby, na ktoré sa dohoda z Hurtigrutenu vzťahuje, sa považovali za služby vo všeobecnom hospodárskom záujme.

Oddiel 10 dohody z Hurtigrutenu obsahovala ustanovenie, že obidve zmluvné strany dohody môžu žiadať o opätovné prerokovanie v prípade, že dôjde k podstatnej zmene podmienok, na základe ktorých bola dohoda uzatvorená. Platnosť dohody z Hurtigrutenu vypršala 31. decembra 2004 a nová dohoda so spoločnosťami vstúpila do platnosti 1. januára 2005 na základe verejnej súťaže v júni 2004.

Súčasný prípad sa týka platby spoločnostiam Hurtigrutenu obsiahnutej v položke 70 kapitoly 1330 (Særskilte transporttiltak) nórskeho štátneho rozpočtu na rok 2004, pričom by spoločnostiam Hurtigrutenu bola poskytnutá suma do výšky 8,5 miliónov NOK (približne 1,1 milióna EUR) ako kompenzácia na základe zmien v nórskom systéme pre diferencované odvody sociálneho zabezpečenia. Poskytnutie pomoci nebolo orgánu notifikované. Kompenzačná platba poskytnutá spoločnostiam Hurtigrutenu bola vyplatená na účely plnej kompenzácie zvýšených nákladov sociálneho zabezpečenia bez toho, aby sa rozlišovalo medzi časťou nákladov sociálneho zabezpečenia týkajúcou sa obchodných činností spoločností a časťou nákladov sociálneho zabezpečenia týkajúcou sa činností spoločností, ktoré by sa mohli považovať za verejnú službu v zmysle článku 59 ods. 2 Dohody o EHP.

Podľa judikatúry musia byť splnené štyri kritériá, aby sa mohol uplatniť článok 59 ods. 2 Dohody o EHP. Po prvé, musí existovať akt o poverení, ktorým štát pridelí podniku zodpovednosť za výkon určitej úlohy. Po druhé, poverenie sa musí týkať služby vo všeobecnom hospodárskom záujme. Po tretie, výnimka musí byť nevyhnutná na vykonávanie pridelených úloh a na tento účel primeraná (ďalej len „požiadavka nevyhnutnosti“). Na záver, rozvoj obchodu nesmie byť ovplyvnený do takej miery, aby to bolo v rozpore so záujmami zmluvných strán.

Na základe dostupných informácií má orgán pochybnosti, či bola pomoc poskytnutá spoločnostiam Hurtigrutenu v súlade s článkom 59 ods. 2 Dohody o EHP. Otázne je najmä, či je pomoc v súlade s vyššie uvedenou požiadavkou nevyhnutnosti, keďže v roku 2004 bola zvýšená pomoc poskytnutá spoločnostiam Hurtigrutenu i v prospech ich obchodných činností. Pri kompenzácii sa nerozlišovalo medzi časťou nákladov sociálneho zabezpečenia týkajúcou sa obchodných činností spoločností a časťou nákladov sociálneho zabezpečenia týkajúcou sa činností, ktoré by sa mohli považovať za verejnú službu v zmysle článku 59 ods. 2 Dohody o EHP.

Navyše má orgán pochybnosti, či by sa pomoc poskytnutá spoločnostiam Hurtigrutenu mala považovať za existujúcu pomoc na základe oddielu 10 dohody z Hurtigrutenu. V oddiele 10 uvedenej dohody sa iba uvádza možnosť zmeniť a doplniť zmluvu na základe nepredvídaných podstatných zmien okolností. V oddiele 10 sa nestanovuje automatické zvýšenie kompenzácie spoločnostiam Hurtigrutenu v prípade zvýšených nákladov, iba sa obidvom zmluvným stranám dohody z Hurtigrutenu poskytuje možnosť požiadať o opätovné prerokovanie bez toho, aby sa vopred stanovil výsledok takého opätovného prerokovania. Z tohto dôvodu je orgán predbežne toho názoru, že pomoc poskytnutá spoločnostiam Hurtigrutenu nemôže byť považovaná za existujúcu pomoc.

Orgán má pochybnosti, pokiaľ ide o zlučiteľnosť pomoci poskytnutej spoločnostiam Hurtigrutenu s pravidlami o štátnej pomoci Dohody o EHP, a najmä s článkom 59 ods. 2 Dohody o EHP. Následne je orgán nútený začať konanie vo veci formálneho zisťovania stanovené v článku 1 ods. 2 časti I protokolu 3 k Dohode o dozore a súde.

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EFTA SURVEILLANCE AUTHORITY DECISION

No 215/06/COL

of 5 July 2006

on compensation to the ‘Hurtigruten companies’ for increased social security contributions

(Norway)

THE EFTA SURVEILLANCE AUTHORITY (1),

Having regard to the Agreement on the European Economic Area (2), in particular to Articles 59 (2) and 61 to 63, and to Protocol 26 thereof,

Having regard to the Agreement between the EFTA States on the establishment of a Surveillance Authority and a Court of Justice (3), in particular to Article 24 thereof and Article 1(2) in Part I of Protocol 3 thereof,

Having regard to the Authority's decision 417/01/COL of 19 December 2001 on compensation for maritime transport services under the ‘Hurtigruten Agreement’ (4),

Having regard to the Authority's decision 172/02/COL of 25 September 2002 to propose appropriate measures to Norway with regard to State aid in the form of regionally differentiated social security taxation,

Having regard to the Authority's decision 218/03/COL of 12 November 2003 on a three-year transition period in Zones 3 and 4 for the regionally differentiated social security contributions,

Having regard to the decision of the Standing Committee of the EFTA States No 2/2003/SC of 1 July 2003 whereby it was decided that the regionally differentiated social security contributions in Zone 5 was compatible with the EEA Agreement due to exceptional circumstances in this zone,

Whereas:

I.   FACTS

1.   Procedure

On 2 August 2004, the Authority sent an information request to the Norwegian authorities regarding a prospective payment to Ofotens og Vesteraalens Dampskibsselskap ASA and Troms Fylkes Dampskibsselskap ASA (5) as a possible compensation due to the changes in the Norwegian differentiated social security system (Event No 289240).

The Norwegian authorities replied by letter from the Ministry of Trade and Industry dated 1 September 2004, forwarding a letter from the Ministry of Transport and Communications of the same date, received and registered by the Authority on 1 September 2004 (Event No 291435).

By letter dated 12 October 2004, the Authority asked for further information (Event No 294990). In this letter, the Authority's Competition and State Aid Directorate stated its view that as the payment was not notified to the Authority and was apparently already put into effect, it would have to be considered as unlawful aid in the meaning of Article 1 f) in Part II of Protocol 3 to the Surveillance and Court Agreement.

The Norwegian authorities replied by letter from the Norwegian Mission dated 18 November 2004, forwarding letters from the Ministry of Modernisation dated 17 November 2004 and the Ministry of Transport and Communications dated 16 November 2004. The letter was received and registered by the Authority on 22 November 2004 (Event No 300326).

By letter dated 26 October 2005, the Authority's Competition and State Aid Directorate informed the Norwegian authorities that it had doubts concerning the compatibility of the payment to the Hurtigruten companies with the functioning of the EEA Agreement (Event No 329347).

The Norwegian authorities replied by letter from the Norwegian Mission dated 22 December 2005, forwarding letters from the Ministry of Modernisation dated 15 December 2005 and the Ministry of Transport and Communications dated 15 December 2005, received and registered by the Authority on 3 January 2006 (Event No 355950).

By letter dated 9 March 2006 the Authority commented on the Norwegian reply (Event No 364024). The Norwegian authorities responded by letter from the Norwegian Mission dated 29 March 2006, forwarding letters from the Ministry of Government Administration and Reform dated 27 March 2006 and the Ministry of Transport and Communications dated 24 March 2006. The letter was received and registered by the Authority on 30 March 2006 (Event No 368446).

2.   Background

The Hurtigruten companies operate maritime transport services consisting of the combined transport of persons and goods along the coastal line from Bergen to Kirkenes. From 1 January 2002 until 31 December 2004, these services were covered by the agreement between the Norwegian authorities and the Hurtigruten companies concerning operation of maritime services along the Norwegian coast (6). The ‘Hurtigruten Agreement’ was notified by the Norwegian authorities to the Authority in July 2000 and subsequently approved by the Authority on 19 December 2001 (7). The Hurtigruten companies are also engaged in commercial business activities which are not part of the Hurtigruten service, such as operating high-speed ferries. The Hurtigruten service itself is partly commercially viable, notably during the summer season, whereas it is, in general, not commercially viable during the winter season. The Authority in its 2001 Decision considered that compensation under the Hurtigruten Agreement could be authorised under Article 59 (2) of the EEA Agreement as the services covered by it were considered to be services of general economic interest.

On 25 September 2002, the Authority decided to propose appropriate measures to Norway with regard to the Norwegian system concerning regionally differentiated social security contributions (8). In the appropriate measures the Authority proposed that Norway should take any legislative, administrative and other measures necessary to eliminate State aid resulting from the system of regionally differentiated social security contributions or render such aid compatible with the EEA Agreement with effect from 1 January 2004. However, the appropriate measures also stated that the Authority might agree to a later date should that be considered objectively necessary and justified by the Authority in order to allow an appropriate transition for the undertakings in question to the adjusted situation. The appropriate measures were accepted by Norway on 31 October 2002.

On 12 November 2003, the Authority accepted a three-year transitional period for the differentiated social security contributions in Zones 3 and 4 in order to achieve a smooth facing-out of the system (9).

On this basis, the Norwegian Parliament, during the autumn of 2003, adopted changes to the differentiated social security system, which entered into force on 1 January 2004. The changes led to higher social security costs for the Hurtigruten companies.

Section 10 of the Hurtigruten Agreement contained a clause whereby both parties to the Agreement could demand a re-negotiation procedure in the event of substantial changes in the prerequisites of the Hurtigruten Agreement. The Hurtigruten Agreement ended as foreseen on 31 December 2004, and a new agreement with the companies entered into force on 1 January 2005, following a tender in June 2004.

3.   Description of the measure

The current case concerns a payment to the Hurtigruten companies contained in Position 70, Chapter 1330 (Særskilte transporttiltak) of the Norwegian 2004 State budget, whereby the Hurtigruten companies would be granted up to NOK 8,5 million (approximately EUR 1,1 million) as compensation due to the changes in the differentiated social security system (10).

The compensation payment granted to the Hurtigruten companies was paid out to fully compensate the increased social security costs without making a distinction between the part of the social security costs pertaining to the commercial activities of the companies and those activities which might be considered public service within the meaning of Article 59 (2) of the EEA Agreement.

In addition to the compensation granted to the Hurtigruten companies, the companies also received aid as a consequence of the Authority's decision of 12 November 2003. However, the present case only concerns the aid granted as compensation for higher social security contributions. In this respect, an amount of NOK 7,352 million (approximately EUR 900 000) was paid out to the companies.

4.   Comments by the Norwegian authorities

The Norwegian authorities are of the opinion that the compensation was within the limits of the compensation authorised by the Authority in its 2001 Decision, and should therefore be classified as ‘existing aid’ in line with the definition of Article 1 b (ii) in Part II of Protocol 3 to the Surveillance and Court Agreement.

The Norwegian authorities consider the payment to be covered by the Hurtigruten Agreement in force at the time when the payment was granted. They rely, in this respect, on Section 10 of the Hurtigruten Agreement, a clause whereby both parties to the Hurtigruten Agreement may demand a re-negotiation procedure in the event of substantial changes in the prerequisites of the Hurtigruten Agreement. The Norwegian authorities state that they regard the changes in the differentiated social security system to fulfil this criterion. They could not have been foreseen by the Hurtigruten companies. As a result of the negotiations with the companies, the compensation for these costs was set to NOK 7,352 million for 2004. The purpose of compensating for the amendments in the social security scheme was, according to the Norwegian authorities, to ensure status quo with regard to the agreed level of transport along the Norwegian coastline, by enabling the Hurtigruten companies to continue to carry out the public service obligation entrusted on them in the Agreement.

The Norwegian authorities take the position that Section 10 of the Hurtigruten Agreement constitutes a legal basis for the re-negotiation of the Agreement and that the clause was recognised by the Authority in its 2001 Decision. On this basis, the compensation for increased social security contributions would, according to the Norwegian authorities, not constitute new aid provided that the compensation was within the scope of the State aid provisions of the EEA Agreement.

Concerning the compatibility of the aid, the Norwegian authorities claim that the compensation for the changes in the social security scheme was granted to the Hurtigruten companies, in order to maintain the transport standard fixed by the Norwegian Parliament. Without the compensation, the standard of the public service obligations entrusted to the companies would have declined; either by the application of higher fares or by reduced frequency of the services. On this background, the Norwegian authorities consider the compensation to be necessary.

The Norwegian authorities declare that, on the basis of § 1 of the Hurtigruten Agreement, the Hurtigruten companies had been compensated without making a distinction between the part of the social security costs pertaining to the commercial activities of the companies and those activities which might be considered public service within the meaning of Article 59 (2) of the EEA Agreement. This provision states that a substantial part of the profits generated by the Hurtigruten companies in the summer season should be used to finance the unprofitable activity in the winter season. The Norwegian authorities are of the opinion that the Authority, by accepting the principle laid down in this provision, has accepted that no clear separation of the commercial and non-commercial services of the Hurtigruten companies is made. On this basis, the Norwegian authorities argue that it is ‘difficult to separate the PSO activity from other commercial activities’ of the companies and thus to grant compensation only to the public service part of the activities. The Norwegian authorities furthermore take the view that the separation between commercial and non-commercial services is not decisive in this connection, and claim that the cross subsidy in this case is clearly in support of the non-commercial services. Moreover, the Norwegian authorities stress that the compensation granted for 2004 does not alter the fact that the commercial services covered by the Hurtigruten Agreement support the activities linked to the public service obligation of the Hurtigruten companies.

Finally, the Norwegian authorities point out that the financial performance of the Hurtigruten companies indicates lower profit than expected (11), and maintain that this shows that no over-compensation takes place.

II.   APPRECIATION

1.   The presence of State aid within the meaning of Article 61(1) EEA

Article 61(1) of the EEA Agreement reads as follows:

‘Save as otherwise provided in this Agreement, any aid granted by EC Member States, EFTA States or through State resources in any form whatsoever which distorts or threatens to distort competition by favouring certain undertakings or the production of certain goods shall, in so far as it affects trade between Contracting Parties, be incompatible with the functioning of this Agreement’.

According to the Authority's 2001 Decision, the compensation granted to the Hurtigruten companies under the Hurtigruten Agreement constitutes State aid within the meaning of Article 61(1) of the EEA Agreement. The Authority's assessment of the grants to the Hurtigruten companies in the 2001 Decision is relevant when assessing the additional aid granted to the companies for the year 2004. The following assessment will therefore, to a large extent, be based on the appreciation made in the 2001 Decision.

The increased compensation to the Hurtigruten companies is financed directly through a budgetary allocation and is thus granted directly by the State. Furthermore, the compensation relieves the companies of social security charges which they normally would have to bear in the ordinary course of business, and thus strengthens the position of these undertakings compared with other undertakings competing in intra-EEA trade. Moreover, the Hurtigruten companies are active on the markets for passenger and cargo transport and on the tourism market, in particular by offering cruises/round trips along the Norwegian coast. The Hurtigruten service to a large extent attracts foreign tourists, and the Hurtigruten companies thus compete with other undertakings offering similar services in attracting these customers. The compensation granted to the Hurtigruten companies can therefore have an effect on the competition on these markets, and is liable to affect trade between the Contracting Parties to the EEA Agreement. The Authority thus considers the payment to the Hurtigruten companies to constitute State aid within the meaning of Article 61 (1) of the EEA Agreement.

2.   New or existing aid

The Norwegian authorities argue that the compensation was in line with the Authority's 2001 Decision, since Section 10 of the Hurtigruten Agreement contained a clause whereby both parties to the Hurtigruten Agreement may demand a re-negotiation procedure in the event of substantial changes in the prerequisites of the Hurtigruten Agreement. According to the Norwegian authorities, the compensation should thus be regarded as existing aid. The Norwegian authorities have stated that they regard the changes in the differentiated social security system to constitute a substantial change, and thus consider the compensation to be reasonable.

The Authority would like to point out that annual compensation of NOK 170 million, expressed in 1999-prices, under the Hurtigruten Agreement had been approved by the Authority. In contrast, the Authority's decision did not deal with Section 10 of the Hurtigruten Agreement as such, and nothing in the Authority's decision suggested that any future amendments of the Hurtigruten Agreement based on this clause would automatically be considered to be in compliance with the State aid provisions of the EEA Agreement.

Section 10 of the Agreement merely allows for the possibility of amending the contract due to unforeseen substantial changes of circumstances. It does not prescribe an automatic increase in the compensation to the Hurtigruten companies in the event of raised costs, but merely opens up for the possibility for both parties to the Hurtigruten Agreement to request a re-negotiation procedure without prescribing the result of such re-negotiation. Furthermore, the provision does not explicitly mention augmentation of the costs as a result of a tax increase as a reason for renegotiation, let alone as a fact that would require an automatic adjustment of the agreement with the exact amount flowing from the tax increase. A change in the tax situation of one contracting party is normally not a factor that the other party is obliged to bear. Hence, even if the Hurtigruten Agreement in its entirety was sent to the Authority, the Authority could not reasonably have been expected to foresee all the possible effects of the provision, and the Authority's silence about the provision in its decision cannot be held to imply that all uses of the provision was hereinafter automatically acceptable from a State aid point of view.

It is the view of the Authority that the contractual provision needs to be distinguished from the separate question of whether the chosen re-adaptation complies with the EEA Agreement, and in particular with the State aid provisions. This question needs to be assessed on its own merits for each case of re-adaptation.

In this case, the Norwegian argumentation can only be considered valid, if at all, for the part of the Hurtigruten activities which are covered by public service obligations within the meaning of Article 59 (2) of the EEA Agreement, as it was the public service obligation compensation which the Authority authorised. Any compensation under Section 10 of the Hurtigruten Agreement cannot be deemed to be in compliance with the State aid provisions of the EEA Agreement. In the case at hand, compensation was granted for the full increase in social security costs, also for those costs that were related to commercial activities not being services of general economic interest. As stated by the Norwegian authorities themselves, it cannot be excluded that the compensation also benefits the commercial parts of the Hurtigruten activities.

The Authority thus considers the aid to be new aid within the meaning of Article 1 c) in Part II of Protocol 3 to the Surveillance and Court Agreement.

3.   Procedural requirements

Pursuant to Article 1 (3) in Part I of Protocol 3 to the Surveillance and Court Agreement, ‘the EFTA Surveillance Authority shall be informed, in sufficient time to enable it to submit its comments, of any plans to grant or alter aid (...). The State concerned shall not put its proposed measures into effect until the procedure has resulted in a final decision’.

The Authority considers the aid to the Hurtigruten companies to be new aid within the meaning of Article 1 c) in Part II of Protocol 3 to the Surveillance and Court Agreement. This implies that the compensation should have been notified to the Authority, according to Article 1 (3) in Part I and Article 2 in Part II of Protocol 3 to the Surveillance and Court Agreement, and should not have been put into effect until the Authority approved the compensation. The Norwegian authorities, however, decided to grant the compensation and not to notify it to the Authority. The compensation is therefore considered as ‘unlawful aid’ within the meaning of Article 1 f) in Part II of Protocol 3 to the Surveillance and Court Agreement and, thus, possibly subject to recovery.

4.   Compatibility of the State aid

Direct aid aimed at covering operating losses is, in general, not compatible with the functioning of the EEA Agreement. Since the increased compensation granted to the Hurtigruten companies covers costs concerning the day-to-day operation of the Hurtigruten service, this payment is to be regarded as operating aid. Such operating aid may be approved, exceptionally, if the conditions set out in derogation provisions of the EEA Agreement are fulfilled.

As in the 2001 Decision, the Authority takes the view that the aid under examination does not qualify for an exemption from the general prohibition of State aid in Article 61 (1) of the EEA Agreement on the basis of Article 61 (2) or (3) of the EEA Agreement.

Aid granted to undertakings performing a service in the general economic interest may, however, be regarded as compatible with the functioning of the EEA Agreement, provided that the conditions laid down in Article 59 (2) of the EEA Agreement are respected.

Pursuant to Article 59 (2) of the EEA Agreement ‘undertakings entrusted with the operation of services of general economic interest...shall be subject to the rules contained in this Agreement, in particular to the rules on competition, in so far as the application of such rules does not obstruct the performance, in law or in fact, of the particular tasks assigned to them. The development of trade must not be affected to such an extent as would be contrary of the interests of the Contracting Parties.’

According to case law, four criteria must be met in order for Article 59 (2) of the EEA Agreement to apply. Firstly, there must be an act of entrustment whereby the State confers responsibility for the execution of a certain task to an undertaking. Secondly, the entrustment must relate to a service of general economic interest. Thirdly, the measure has to be necessary for the performance of the tasks assigned and proportional to that end (hereinafter ‘the necessity requirement’). Finally, the development of trade must not be affected to such an extent as would be contrary to the interests of the Contracting Parties.

In its 2001 Decision, the Authority assessed the compatibility of the compensation to the Hurtigruten companies, as defined in the Hurtigruten Agreement, with Article 59 (2) of the EEA Agreement. When carrying out that assessment, the Authority took into account sector specific rules, as laid down in the Maritime Cabotage Regulation (12) and Chapter 24A of the Authority's State Aid Guidelines: Aid to maritime transport. The Authority will base its assessment of the increased compensation for 2004 on the appreciation of the Hurtigruten Agreement in the 2001 Decision.

In the 2001 Decision, the Authority regarded parts of the Hurtigruten service as covered by the concept of a service of general economic interest. It furthermore concluded that the Hurtigruten Agreement constituted a public act through which the Hurtigruten companies were entrusted with the operation of services in the general economic interest. Moreover, the agreed payment to Hurtigruten under the Hurtigruten Agreement was, in the Authority's opinion, necessary in order to compensate for the public service obligations imposed on the Hurtigruten companies. Finally, the Authority concluded that the Hurtigruten Agreement would not affect trade to an extent contrary to the interests of the Contracting Parties to the EEA Agreement.

As the Norwegian authorities have paid an increased compensation to the Hurtigruten companies for 2004, the question arises whether the compensation can still be considered to meet the criteria of Article 59 (2) of the EEA Agreement, and in particular whether the necessity requirement is still met.

The necessity requirement implies that the amount of compensation shall not exceed what is necessary to cover the costs incurred in discharging the public service obligations, taking into account the relevant receipts and a reasonable profit on own capital necessary for discharging those obligations. This compensation must be used for the functioning of the service of general economic interest concerned. It furthermore follows that where the undertaking also carries out activities falling outside the scope of the service of general economic interest, only the costs associated with the service of general economic interest shall be taken into consideration.

However, the increased aid to the Hurtigruten companies in 2004, paid out in order to compensate them for changes in the differentiated social security scheme, has been granted — as stated by the Norwegian authorities — also in favour of commercial activities, as the compensation did not make a distinction between the part of the social security costs related to the commercial activities of the companies and those activities which might be considered public service within the meaning of Article 59 (2) of the EEA Agreement.

The Norwegian authorities have agued that it follows from the Hurtigruten Agreement that no clear separation of the commercial and non-commercial services of the Hurtigruten companies has to be made, as a substantial part of the profits generated by the Hurtigruten companies in the summer season should be used to finance the unprofitable activity in the winter season. However, the fact that Norwegian authorities have chosen this solution in order to minimize the need for public service compensation does not imply that an increased new aid partially in favour of commercial activity can be considered as necessary for the provision of the public service.

Furthermore, the Authority would like to point out that the 2001 Decision clearly stated that the compensation granted to the Hurtigruten companies may only cover activities in relation with the public service obligation of the companies. The Authority did not accept State aid for the commercially viable part of the service. Moreover, the 2001 Decision was based on a report prepared by Arthur Andersen which analysed the Hurtigruten activities and the need for public service compensation in order to uphold the level of the public service. The public service cost, and thus the allowed State aid set out in the 2001 Decision, was established based on this report.

In addition, the Authority underlines that in order to increase the level of State aid granted to the Hurtigruten companies in line with the 2001 Decision, the Norwegian authorities would have to document that the increased aid is granted only to the public service part of the activity. However, the Norwegian authorities have not denied that the increased State aid to the Hurtigruten companies does partially finance the commercial part of the activity. Neither have the Norwegian authorities made any attempt to calculate the split between the public service part and the commercial part of the Hurtigruten activity in order to grant compensation only to the public service related part of the activity.

Concerning the argument made by the Norwegian authorities that the compensation has been paid without distinction because it was difficult to separate the public service obligations from the commercial activities of the Hurtigruten companies, this is not sufficient to accept an aid which is not in line with the necessity requirement. The concept of public service compensation presupposes that a separation of the costs relating to the public service activities and costs relating to commercial activities has been performed.

Furthermore, the Norwegian authorities argue that even if the grant to the Hurtigruten companies has been increased, this does not involve overcompensation, as the financial performance of the Hurtigruten companies indicates lower profit than was expected when the amount of compensation for public services activities carried out by the companies was calculated. However, even if the companies' profits should indeed be lower than expected, this does not give the Norwegian authorities the right to give a higher compensation than that approved by the Authority in the 2001 Decision, unless it is established that this compensation is necessary to cover the public service costs. In any event, it cannot justify the granting of aid for commercial activities, which are not covered by the application of Article 59 (2) of the EEA Agreement.

In the view of the Authority, it follows from the above that the increased aid paid to the Hurtigruten companies seems to exceed the amount of compensation necessary in order for the companies to fulfil their public service obligations. Such over-compensation would not be compatible with Article 59 (2) of the EEA Agreement, and would thus constitute State aid which is incompatible with the EEA Agreement.

It follows from the above that, according to the preliminary appreciation of the Authority, the part of the compensation granted to the commercial activities of the Hurtigruten companies is to be regarded as State aid incompatible with the EEA Agreement and, thus, possibly subject to recovery. Only the part of compensation directly relating to the performance of the public service obligation would be compatible and, hence, not subject to recovery. Should it, as argued by the Norwegian authorities, prove impossible to make a separation between the increased costs incurred in relation with the public service activities and with the commercial activities of the Hurtigruten companies, the Authority might be forced to regard the compensation in its entirety as State aid incompatible with the EEA Agreement. The compensation would in this case also be subject to recovery in its entirety.

5.   Conclusion

Based on the information submitted by the Norwegian Government, the Authority cannot exclude that the compensation to the Hurtigruten companies for increased social security contributions constitutes aid within the meaning of Article 61 (1) of the EEA Agreement. The Authority cannot see that any exceptions under Article 61 (2) or (3) to the general prohibition of State aid under Article 61 (1) of the EEA Agreement applies to the aid. Furthermore, the Authority has doubts that the measure can be regarded as complying with Article 59 (2) of the EEA Agreement. Consequently, the Authority has doubts that the above measure is compatible with the functioning of the EEA Agreement.

Furthermore, it is the Authority's preliminary view that the aid is to be considered as new aid within the meaning of Article 1 c) in Part II of Protocol 3 to the Surveillance and Court Agreement. This implies that the compensation should have been notified to the Authority, according to Article 1 (3) in Part I and Article 2 in Part II of Protocol 3 to the Surveillance and Court Agreement. The compensation is therefore considered as ‘unlawful aid’ within the meaning of Article 1 f) in Part II of Protocol 3 to the Surveillance and Court Agreement and subject to possible recovery.

Consequently, and in accordance with Articles 13 (1) and 4 (4) in Part II of Protocol 3 to the Surveillance and Court Agreement, the Authority is obliged to open the procedure provided for in Article 1 (2) in Part I of Protocol 3 of the Surveillance and Court Agreement. The decision to open proceedings is without prejudice to the final decision of the Authority, which may conclude that the measure in question is compatible with the functioning of the EEA Agreement.

In the light of the foregoing considerations, the Authority, acting under the procedure laid down in Article 1 (2) in Part I of Protocol 3 to the Surveillance and Court Agreement, requests Norway to submit its comments and to provide all such information as may help to assess the compensation to the Hurtigruten companies for increased social security contribution, within two months from receipt of this decision.

HAS ADOPTED THIS DECISION:

Done at Brussels, 5 July 2006

For the EFTA Surveillance Authority

Bjørn T. GRYDELAND

President

Kristján A. STEFÁNSSON

College Member

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(1)  Hereinafter referred to as the ‘Authority’.

(2)  Hereinafter referred to as the ‘EEA Agreement’.

(3)  Hereinafter referred to as the ‘Surveillance and Court Agreement’.

(4)  The Authority's decisions are available on http://www.eftasurv.int/.

(5)  Hereinafter referred to as the ‘Hurtigruten companies’.

(6)  Hereinafter referred to as the ‘Hurtigruten Agreement’.

(7)  Decision 417/01/COL, hereinafter referred to as the ‘2001 Decision’.

(8)  Decision 172/02/COL.

(9)  Decision 218/03/COL. The transitional period did not apply to Zone 5, as the EFTA States by decision No 2/2003/SC of 1 July 2003 decided that the regionally differentiated social security contributions in Zone 5 was compatible with the EEA Agreement due to exceptional circumstances in this zone.

(10)  The comments to Position 70 read as follows: Av budsjettforslaget på 200,8 mill. kr for 2004, er 192,3 mill. kr direkte relatert til den gjeldende avtalen med hurtigruterederiene. Restbeløpet på 8,5 mill. kr er knyttet til ev. kompensasjon som følge av endringer i ordningen med differensiert arbeidsgiveravgift. Endelig kompensasjonsbeløp vil bli bestemt når forhandlingene mellom hurtigruteselskapene og departementet er avsluttet. [Unofficial translation by the Authority: Of the budget proposal of NOK 200,8 million for 2004, NOK 192,3 million are directly related to the current agreement with the Hurtigruten companies. The remainder of NOK 8,5 million is related to possible compensation as a consequence of amendments to the system concerning differentiated social security contributions. The final compensation will be determined when the negotiations between the Hurtigruten companies and the Ministry are finished.]

(11)  In this regard, the Norwegian authorities refer to a report prepared by Arthur Andersen in 2000 called Behov for statlige tjenestekjøp etter 2001, which analysed the Hurtigruten activities.

(12)  Council Regulation (EEC) No 3577/92 of 7 December 1992 applying the principle of freedom to provide services to maritime transport within Member States (maritime cabotage).

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