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            COMMISSION DECISION         

of 16 June 2004         

on the measures implemented by Spain for Siderúrgica Añón SA

(notified under document number C(2004) 1813)

(Only the Spanish text is authentic)

(Text with EEA relevance)

(2005/827/EC)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European Community, and in particular the first subparagraph of Article 88(2) thereof,

Having regard to the Agreement on the European Economic Area, and in particular Article 62(1)(a) thereof,

Having called on interested parties to submit their comments pursuant to the provisions cited above (1), and having regard to their comments,

Whereas:

I.   PROCEDURE

II.   FACTS

1.   The recipient

2.   The market

3.   Description of the measures

4.   Grounds for initiating the procedure

III.   COMMENTS FROM INTERESTED PARTIES

IV.   COMMENTS FROM SPAIN

V.   ASSESSMENT OF THE MEASURES

1.   Existence of state aid

(a)   The acquisition by SODIGA of a stake in the share capital of Siderúrgica Añón

(b)   The loan granted through INESGA

(c)   The guarantee granted by IGAPE

(d)   Other measures

(e)   Distortion of competition and effect on trade

2.   Compatibility with the common market

VI.   CONCLUSION

HAS ADOPTED THIS DECISION:

Article 1

1.   The state aid which Spain has granted to Siderúrgica Añón SA is incompatible with the common market.

2.   The aid referred to in paragraph 1 includes the following:

Article 2

1.   Spain shall refrain from any further grant of aid to the recipient via the measures referred to in Article 1.

With regard to payments already authorised but not made by the date of adoption of this Decision, Spain may require the reimbursement of all payments made after the date of adoption of this Decision or as of that date shall adjust the conditions of the measures listed in Article 1 to market conditions as referred to in this Decision.

2.   Spain shall take all necessary measures to recover from the recipient the aid referred to in Article 1.

3.   Recovery shall be effected without delay in accordance with the procedures under national law, provided these allow the immediate and effective implementation of this Decision. The sums to be recovered shall bear interest throughout the period running from the date on which they were first put at the disposal of the recipient until their actual recovery. The interest rate to be applied shall be the reference rate used for calculating the grant equivalent of regional aid.

The interest rate referred to in the first subparagraph shall be applied on a compound basis throughout the entire period referred to therein.

Article 3

Spain shall inform the Commission, within two months following notification of this Decision, of the measures planned and already taken to comply with it. It shall provide this information using the questionnaire attached in Annex to this Decision.

Article 4

This Decision is addressed to the Kingdom of Spain.

Done at Brussels, 16 June 2004.

For the Commission

Mario MONTI            

Member of the Commission

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(1)OJ C 33, 6.2.2002, p. 9 and OJ C 223, 19.9.2002, p. 2.

(2)OJ L 338, 28.12.1996, p. 42.

(3)OJ C 33, 6.2.2002, p. 9.

(4)OJ C 223, 19.9.2002, p. 2.

(5)  INESGA is a development fund dedicated to facilitating the financing of viable projects with special interest for the Galician economy, through agreements with financial institutions. On 29 May 2000, the Galician regional government and seven banks signed an agreement whereby these banks undertook to contribute up to EUR 108,2 million for the financing of investment projects. Under the terms of the agreement, any participating bank can refuse to contribute to the financing of any given project.

(6)OJ L 10, 13.1.2001, p. 33. Regulation as amended by Regulation (EC) No 364/2004 (OJ L 63, 28.2.2004, p. 22).

(7)OJ C 119, 22.5.2002, p. 22.

(8)OJ C 152, 26.6.2002, p. 5.

(9)  Grant provided by IGAPE, gge: 0,95 %; interest-free loan by Ministry of Science and Technology, gge: 2,8 %; loan granted through INESGA, gge: 2,32 %; guarantee granted by IGAPE, gge: 0,63 %; subsidisation by IGAPE of the loan granted by INESGA, gge: 0,32 %; subsidisation by IGAPE of the formalisation fee, gge: 0,16 %.

(10)OJ L 83, 27.3.1999, p. 1. Regulation as amended by the 2003 Act of Accession.

(11)OJ C 235, 21.8.2001, p. 3.

(12)OJ L 10, 13.1.2001, p. 30.

(13)OJ C 37, 3.2.2001, p. 3.

(14)OJ L 260, 6.9.1989, p. 1.

(15)  [2002] ECR I-11991, paragraph 60.

(16)  Source http://www.xunta.es/Galicia2001/G200112G.pdf

(17)  See the Judgment of the Court of 10 July 1986 in Case 234/84 Kingdom of Belgium v Commission of the European Communities (Boch) [1986] ECR 2263, paragraph 14: ‘An appropriate way of establishing whether such a measure is a state aid is to apply the criterion which was mentioned in the Commission's decision and, moreover, was not contested by the Belgian Government, of determining to what extent the undertaking would be able to obtain the sums in question on the private capital markets. In the case of an undertaking whose capital is held by the public authorities, the test is, in particular, whether in similar circumstances a private shareholder, having regard to the foreseeability of obtaining a return and leaving aside all social, regional-policy and sectoral considerations, would have subscribed the capital in question’. See also the Judgment of the Court of First Instance of 6 March 2003 in Joined Cases T-228/99 and T-233/99 Westdeutsche Landesbank Girozentrale and Land Nordrhein-Westfalen v Commission of the European Communities [2003] ECR II-435, paragraphs 255, 266, 313 and 324.

(18)  Although the possibility cannot be ruled out that the final price could be higher if the alternative method (theoretical accounting value) was used, according to the latest projections made by SODIGA in February 2002, the use of this theoretical accounting value would yield a return on investment of 6,3 %.

(19)OJ L 108, 30.4.2003, p. 35.

(20)  This approach is also in line with the one taken by the Commission in Decision 2003/284/EC, in which it added 600 basis points to a subordinated loan because of the absence of any security. See recital 42 of the Decision referred to in footnote 19.

(21)OJ C 273, 9.9.1997, p. 3. See in particular the eighth paragraph, first indent.

(22)  Concerning the comparison made in the two tables above, account has to be taken of the fact that the actual rate of return on the measures, i.e. 7,2 %, corresponds to a hypothetical annual premium that would also be due in 2007 (the year of reimbursement of the principal) whereas in reality these revenues have been spread over only five (instead of six) and four (instead of five) instalments respectively.

(23)  Commission notice on the application of Articles 87 and 88 of the EC Treaty to state aid in the form of guarantees (OJ C 71, 11.3.2000, p. 14, point 4.2).

(24)OJ C 288, 9.10.1999, p. 2.

(25)  Although the life of, and therefore the base rate for, the two loans are different, the Commission considers that the risk premium required by a private creditor for a non-secured loan can constitute a reliable parameter for assessing the aid element involved in the INESGA loan.

(26)OJ C 298, 11.11.1995.

(27)OJ C 199, 14.7.2001, p. 11.

(28)OJ C 119, 22.5.2002, p. 22.

(29)  Clerical error: should read ‘Article 9a(2)’.

(30)OJ C 70, 19.3.2002, p. 21.

(31)OJ C 70, 19.3.2002, p. 8.

(32)  This provision is applicable for the assessment of the aid granted, according to the Commission notice on the determination of the applicable rules for the assessment of unlawful state aid and points 82(b) and 7, second paragraph, of the Community guidelines on state aid for environmental protection.

(33)  Community guidelines on state aid for environmental protection.

(34)  See in particular the first sentence of the Annex to the Steel Aid Code.

(35)  See point (b) under ‘Aid to encourage firms to contribute to significantly improved environmental protection’ in the Annex.

(36)OJ L 10, 13.1.2001, p. 20. Regulation as amended by Regulation (EC) No 363/2004 (OJ L 63, 28.2.2004, p. 20).

(37)OJ L 337, 13.12.2002, p. 3.

(38)  In line with the last paragraph of the Commission notice on the determination of the applicable rules for the assessment of unlawful state aid, the Commission must check whether the aid could be compatible with any Commission or Council regulation currently in force in the state aid field.

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ANNEX

Information regarding the implementation of the Commission Decision

1.   CALCULATION OF THE AMOUNT TO BE RECOVERED

2.   RECOVERY MEASURES PLANNED OR ALREADY TAKEN

3.   RECOVERY ALREADY EFFECTED

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(1)

(2)

(*1)  Amount of aid put at the disposal of the recipient, in gross grant equivalent.

(*2)  Date or dates on which the recipient repaid the aid or individual instalments of aid.

(3)

(4)

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