17. 3.90 Official Journal of the European Communities No C 67/11 
1. By letter dated 21 September 1989, recorded as 
received on 22 September 1989, the Permanent 
Representation of Spain to the European 
Communities communicated the draft regional decree 
referred to above. 
2. The draft decree provides for the grant of an annual 
compensatory allowance to farmers located in the 
areas mentioned in Article 2 and which are not 
included in the Community list of less-favoured areas 
as defined in Directive 86/466/EEC for Spain. 
The measures in question are therefore not covered 
by Article 13 (Title III) of Regulation (EEC) No 
797/85; consequently, they must be examined in the 
light of Articles 92 to 94 of the Treaty pursuant to 
Article 31 of the said Regulation. 
3. The allowance is in fact an income aid to farmers 
enabling them to lower their production costs in 
relation to those of their competitors. It therefore has 
a direct impact on competition and on trade between 
Member States. However, there is no lasting effect, 
and any effects the measure does have will disappear 
with the measure itself. 
The aid is of a type to which the Commission has 
always objected; such measures cannot benefit from 
the exceptions provided for in Article 92 (3) of the 
Treaty and are not to be considered as income aids 
within the meaning of Council Regulation (EEC) No 
768/89. 
Commission communication pursuant to Article 93 (2) of 
the EEC Treaty to other Member States and interested 
parties concerning aids which Belgium has decided to 
grant to for the building of two refrigerator ships at the 
Boelwerf yard. 
The Commission has learnt from reliable sources that the 
Belgian Government appears to have granted a loan to 
the shipowner Cool Carrier for the building of the two 
vessels referred to above in the Boelwerf shipyard. 4. Moreover, the Commission informs the Spanish 
Government that it is giving notice to the other 
Member States, by sending them a copy of this letter, 
and to other interested parties by publishing a 
communication in the Official Journal of the European 
Communities, to submit their comments. 
5. The Commission draws the attention of the Spanish 
Government to the letter which it sent to all Member 
States on 3 November 1983 on the subject of their 
obligations under Article 93 (3) of the Treaty and to 
the communication published in the Official Journal of 
the European Communities No C 318/3 of 24 
November 1983 according to which any aid granted 
illegally (i.e. without awaiting the final decision under 
the procedure laid down in Article 93 (2) of the 
Treaty) may have to be refunded. Furthermore, the 
Commission may refuse to make EAGGF advance 
payments or to charge the expenditure relating to 
national measures that directly affect Community 
measures to the EAGGF budget. 
The Commission hereby gives the other Member States 
and interested parties notice to submit their comments on 
the measure in question within four weeks from the date 
of publication of this notice to: 
Commission of the European Communities, 
200 rue de la Loi, 
B-1049 Brussels. 
The comments will be communicated to Spain. 
By letter dated 5 June 1989, the Commission requested 
the Belgian Government to notify it, pursuant to Article 
93 (3) of the EEC Treaty, of the measure referred to 
above. 
According to the information in the possession of the 
Commission, the contract for the building of the two 
refrigerator ships comprises a credit from the maritime 
fund, under the Law of 28 August 1948, amounting to STATE AID 
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(Belgium) 
(Articles 92 to 94 of the Treaty establishing the European Economic Community) 
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No C 67/12 Official Journal of the European Communities 17. 3.90 
85 % of the contract price, for a period of 18 years, with 
a three-year grace period and an interest rate of 2 %. 
The grant equivalent in this case would be more than 
34 % of the contract price, excluding the grant equi­
valent corresponding to the terms of the export credit in 
accordance with the OECD arrangement. The reply sent 
by your Government confirms these data. 
It would seem, therefore, that the credit conditions are 
more favourable than those known to the Commission 
which, in the most favourable instances, cover 85 °/o of 
the contract price for 15 years with a two-year grace 
period and an interest rate of 4 to 5 %, for 70 % of the 
contract price, the remaining 15 % being borrowed at 
the commercial rate with an interest subsidy of 3 % and 
a State guarantee. 
It would appear therefore that your Government has not 
complied with the first sentence of Article 93 (3) of the 
EEC Treaty in the case in point. Furthermore, taking 
account of the commercial interest rate currently in force 
in Belgium, i.e. 8,25 %, the terms of the loan awarded 
for the financing of the vessels in question are 
considerably in excess of the 26 % ceiling fixed by the 
Commission for 1989; as a result, the aid granted does 
not comply with the conditions of Article 4 (1) of 
Directive 87/167/EEC on aid to shipbuilding. 
Lastly, as regards the comments contained in the reply 
from your Government, it should be noted that grant 
equivalent was estimated by the Commission in January 
1989 at 19,5 °/o, which took account of the most 
favourable conditions possible, as described above in the 
fourth paragraph, the reference rate being 8,25 %. 
Furthermore, although the Belgian shipping credit is not 
destined simply for shipbuilding, this is also true of other 
Member States, and Article 3 of the Sixth Directive 
clearly stipulates that such aid is subject to the rules in 
Article 4. In the light of these observations, the Commission would 
inform the Belgian Government that, having examined 
the aid in question, it has decided to open the procedure 
provided for in Article 93 (2) of the EEC Treaty. 
The Commission hereby gives the Belgian Government 
notice, as part of that procedure, notice to submit its 
comments within one month from the date of this letter. 
The Commission would also inform the Belgian 
Government that it is publishing a notice in the Official 
Journal of the European Communities inviting other 
Member States and interested parties to submit their 
comments. 
The Commission would remind the Belgian Government 
that Article 93 (3) of the EEC Treaty prevents the 
proposed measures being put into effect until the Article 
93 (2) procedure has resulted in a final decision. 
The Commission would draw the attention of the 
Belgian Government to the letter it sent all Member 
States on 3 November 1983 on the subject of their obli­
gations under Article 93 (3) of the EEC Treaty and the 
communication it published in the Official Journal of the 
European Communities, No C 318, 24 November 1983, 
page 3, in which it reminded Member States that where 
they grant aid unlawfully, i.e. before the Article 93 (2) 
procedure has resulted in a final decision, the 
Commission may require them to recover it. 
The Commission hereby gives the other Member States 
and interested parties notice to submit their comments on 
the measures in question within one month from the date 
of publication of this notice to: 
Commission of the European Communities, 
200 rue de la Loi, 
B-1049 Brussels. 
The comments will he communicated to Belgium.