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(2004/C 88 E/0302)

WRITTEN QUESTION P-3496/02

by Paulo Casaca (PSE) to the Commission

(2 December 2002)

Subject:   State aid for small-scale coastal shipping on the Azores

On 26 November 2002, at around one o'clock in the afternoon, the ‘Rival’, a small cargo ship about 100 years old, was wrecked in the channel between the towns of Horta and Madalena in the autonomous region of the Azores, causing the death of the captain, Manuel Fernando Costa.

Seamen working for the small shipping company Cristiano Lda, which owned the vessel, had already told me of their wish to modernise their two vessels and obtain a licence for passenger transport.

However, the regional authorities have informed me that the current regional development programme financed under the Structural Funds – the main financial mechanism available on the Azores for providing public aid for economic modernisation – did not make any provision for supporting local maritime transport firms since the corresponding proposal submitted by the regional authorities in the Azores was not approved in time by the European authorities responsible for supervising competition.

Does the Commission consider it appropriate to subject possible state aid for tiny maritime transport firms on the Azores to the same type of examination as support for large European maritime transport companies?

Does the Commission take account of the fact that the small maritime shipping firms still operating on the Azores play an extremely important and irreplaceable role for people living on the smallest islands, and does it take account of maritime safety conditions in the autonomous region of the Azores and the need to improve safety levels in local transport?

Does the Commission take due account of Article 299(2) in its state aid procedures in the field of maritime transport?

Answer given by Mrs de Palacio on behalf of the Commission

(22 January 2003)

As far as structural funding is concerned, the Operational Programme for the Azores (Prodesa) included in the Community Support Framework for Portugal 2000-2006 provides, under priority 5, measure 5.4, for the possibility of supporting the purchase of facilities for use in the carriage of passengers by air and ship between the islands provided the facilities are used throughout their useful life for the purposes originally intended.

Similarly, in order to increase safety and accessibility to the islands, measure 1.1 of priority 1 in the above Operational Programme provides for the possibility of funding projects for the construction/renovation of commercial ports, harbour stations and other projects to support port-related activities and for the purchase of facilities, means of transport and machinery for the handling and transportation of goods and passengers in ports and airports. The range of possibilities offered should make it possible to increase the safety of access and facilitate transport between the islands.

The Commission is prepared to study any useful changes to Prodesa which the national and regional authorities feel it is necessary to propose in this field during the mid-term review due to take place in a year's time.

With regard to the monitoring of State aid, the Commission has not been notified of any planned aid scheme specifically addressing the needs of local shipping companies which provide links between the islands in the Azores Archipelago under the competition rules on State aid.

Last year the Commission received a notification concerning the (re-)creation of an aid scheme for the free zone of Madeira for the period 2003-2006 which had been suspended by the Portuguese authorities between 2000 and 2001. According to the notification, the free zone of Madeira will have an international shipping register, an industrial free zone and an international services centre. On 11 December, the Commission adopted a decision authorising the main points of the scheme. A decision on the international shipping register will follow before the end of the month. The aid is intended more for the international sectors of the islands, however.

Whatever the situation, the rules on aid to maritime transport (‘Community guidelines on State aid to maritime transport’ (1)) allow aid to be granted under certain conditions and the Commission, when examining such aid, takes account of the socio-economic context of the aid scheme. If it were notified of any plan for aid to shipping companies providing links between the islands in the Azores Archipelago, the Commission would consider it favourably.

The question of taking due account of Article 229(2) when applying the Community competition rules is still being considered by the Commission. In general, the Commission takes the view that transport is a strategic factor for the development of the outermost regions, as underlined in the Conclusions of the Seville European Council and the recent declaration by the Presidents of the outermost regions adopted on La Palma on 15 October 2002. This subject will therefore be considered in great detail in the framework of the report on the future of the outermost regions which the Commission will be presenting at the end of 2003 in conformity with the conclusions of the Seville European Council. The matters considered will in particular focus on State aid and public service obligations in the transport sector and mobilisation of the Structural Funds to maintain and develop transport to overcome the handicap these regions suffer in being the outermost regions.

As it announced in the White Paper European transport policy for 2010: time to decide (2), the Commission is already preparing to relax the Community rules on public maritime services where links to small islands are involved.

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(1)OJ C 205, 5.7.1997, p. 5.

(2)  COM(2001) 370 final.

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