NoL335/30 OfficialJournaloftheEuropeanCommunities 14.12.74
COMMISSION DECISION
of16October1974
approvingadditionalaidstobegrantedbytheFederalRepublicofGermanyforthe
benefitofundertakingsinthecoalindustryinrespectofthecalendaryears1971,1972
and1973
(OnlytheGermantextisauthentic)
(74/613/ECSC)
THECOMMISSION OFTHEEUROPEAN
COMMUNITIES ,Whereasthepurposeofthatmeasurewastoimprove
theundertaking'sliquidityposition,RAGbeing
abletouseitsclaimassecurityinordertoobtain
additionalcreditfromthebanks;
Whereas,accordingtotheannualreportsfor1971
and1972publishedbyRAG:
—in1971operatinglossesofDM178millionwere
notcoveredbyfinancialassistancefrompublic
fundsbutcarriedforwardtothe1972financial
year;
—in1972operatinglossesrosebyDM567
million;
WhereasRAG'stotallossesthereforeamountedto
DM745millionattheendof1972;
Whereas,inordertoeaseRAG'scriticalposition
theFederalGovernment hasauthorizedtherelease
ofDM650millionfromChespeciallycreated
stabilizationreserve(whichwastobefundedoutof
thecompany'sregisteredclaim),inordertocover
partoftheoperatinglossessustainedin1971and
1972;whereas,followingtheimplementation ofthis
measureRAGstillhadattheendof1972uncovered
lossesofDM95million,whichwerecarriedforward
tothe1973financialyear;
WhereasRAG'sregisteredclaimwasthususednot
onlytoimproveitsliquiditypositionbutalsoto
coverlosses;
WhereasRAG'stotallossesofDM745millionatthe
endof1972exceededitssharecapitalofDM500
millionbyalmost150%,sothatitwouldnolonger
havebeenpossibleforCheundertakingtostayin
business;HavingregardtotheTreatyestablishingthe
EuropeanCoalandSteelCommunity ,andin
particularArticles2,3,4and5thereof;
HavingregardtoCommissionDecisionNo3/71/
ECSC(')of22December1970onCommunityrules
forinterventionbyMemberStatesforthebenefitof
thecoalindustry;
HavingregardtoDecisionNo73/287/ECSC(2)of
25July1973oncokingcoalandcoke,andin
particularArticle9(1)thereof;
HavingconsultedtheCouncil;
Whereason14November1973theCommission of
theEuropeanCommunities adoptedDecision
No73/397/ECSC(3);whereasthisDecisionapproved
theaidproposedbytiheGovernmentoftheFederal
RepublicofGermanyforthebenefitofthecoal
industryinrespectof1972totheextentthatithad
beenincludedandexaminedbytheCommissionin
the'supplementary reportonfinancialintervention
byMemberStatesin1972forthebenefitofthe
coalindustry'(4);
Whereas,asstatedinthatreport(5),theFederal
Governmenthadadoptedanumberofmeasuresto
aidthelargestGermancoalundertaking ,the
RuhrkohleAG(RAG);includedtheentryin
November1971intheOfficialDebtRegister
(Schuldbuck )ofaclaim(Schuldbuckforderung )in
favourofRAGinanamountofDM1000million;
WOJNoL3,5.1.1971,pp.7etseq.
(2)OJNoL259,15.9.1973,p.41.
(3)OJNoL346,17.12.1973,pp.15etseq.
(4)Doc.SEC(73)2272fin.,pp.3etsea.
(5)Doc.SEC(73)2272fin.,pp.4etseq.Whereastheeconomicandsocialsituationinthe
LandNorthRhine-Westphalia ,whereRAGcarrieson

14.12.74 OfficialJournaloftheEuropeanCommunities NoL335/31
Whereas87%oftheoperatinglossessustainedby
RAGaretobecovered 'bytheaid;whereasifthis
percentageisappliedtoeachofthefinancialyears
theaid(DM650million)canbe'brokendowninto
DM155millionfor1971andDM495millionfor
1972(42-3millionu.a.and135-2millionu.a.
respectively);
Whereasthefollowingamountsofaidaretobe
grantedtotheentirecoalindustryintheFederal
RepublicofGermanyin1971and1972;
millionunitsofaccount
1971 1972
Originalamounts 210-1261-1
Additionalamounts 42-3135-2
Total 252-4396-3
Aidpermetricton 2-163-65thegreaterpartofitsactivities,isatpresentrelatively
favourable,althoughtherearestillproblemsin
certainfields,mostlyinconnectionwithcoal­
mining(*);whereas,however,thissituationwould
changeifRAGhadtoceaseitsactivitiesand
dismiss,withinarelativelyshortperiodoftime,
the170000employeeswhosejobsatpresentit
provides;whereasinthecircumstances itfollows
thatthecoveringoflossesiscompatiblewiththe
provisionsofthefirstsubparagraphofArticle9(1),
sincetheeffectofthisistopreventadropin
productionduetomarketforceswhichwouldresult
inseriouseconomicandsocialupheavalsinanarea
where,intheshortterm,thereisinsufficient
employmentforsuchalargenumiberofworkers;
Whereas,asregardstheappropriateness oftheaid
havingregardtothedifferencebetweenproduction
costsandrevenue,itcanbeseenthattheaidwill
coveronlyapproximately 87%ofthetotaloperating
lossesfor1971and1972;whereastheoperating
lossesstemalmostexclusivelyfromthecollieries;
whereastheaidsthereforecomplywiththe
provisionsofArticle9(2)ofDecision
No3/71/ECSC;
Whereastheaidistobepaidfortwoprevious
financialyears(1971and1972);whereasotheraids
grantedbythepublicauthoritiestotheundertaking
duringthosetwofinancialyears,andincludedand
examinedintheCommissionmemorandum ,were
countedasexceptionalincomeWhendetermining
theamountofthelosses;whereasthepaymentof
theaidinrespectofthepreviousyearsistherefore
compatiblewiththeprovisionsofArticle9(5)of
DecisionNo3/71/ECSC;
Whereasitcanbeconcludedfromtheexplanation
givenabovethatthecoveringbythepublic
authoritiesofpartoftheoperatinglossessustained
byRAGinthefinancialyears1971and1972is
compatiblewiththeprovisionsofArticle9of
DecisionNo3/71/ECSC;
Whereas,forthepurposesofanexaminationofthe
compatibility oftheaidtocoveroperatinglosses
sustainedbyRAGwiththeproperfunctioningof
thecommonmarket(Article3(1)ofDecisionNo
3/71/ECSC),thetotalamountofDM650million
mustbedividedproportionally betweenthefinancial
years1971and1972andaddedtotheamountsof
aidalreadyapproved 'bytheCommission for
1971/72;WhereasthetotalamountofGermanaidfor1972
is143-9millionunitsofaccount(—+57%higher
thanfor1971);whereastheincreaseintheamount
ofaidpermetrictonamountsto69%;
Whereas,asfarascanbeseenfromtheoverall
foreigntradefigures,thishashadnounfavourable
effectsonthetradeincoalwithintheCommunity ;
Whereas,althoughaidtowardsthecoveringofthe
lossessustainedbyRAGhasreducedthedifference
betweentheamountofsubsidiesgrantedinGermany
andintheotherMemberStates,ithas,however,at
thesametime,createdadifferencebetweenthe
subsidiesgrantedtoRAGandthosegrantedtothe
otherGermanundertakings in1972,sincetheaid
wasforthebenefitofoneundertakingonly;
whereas,onaccountofthisandinviewofthe
increaseinthenumberofpricealignmentagreements
concludedin1972,theCommissionhasexamined
thecompetitivesituation;whereasitwasfoundthat
thevariousGermanundertakings inthecoal
industrywereincompetitionwithRAGinrespect
ofcertainpartsoftheirproduction,butthatthere
werenosubstantialindicationsthattheaidgranted
toRAGtocoveritslosseshadledtoadistortion
ofcompetitiononthecommonmarketincoal;
whereasthequantitiesofcoalsoldatthealigned
pricesin1972wereinfactgreaterthanthosesold
in1971;whereassudhalignmentagreementswere(x)SeetheCommissionDecisionof17February1971
concerninginvestmentpremiumsintheGermancoal­
miningregions(OJNoL57,10.3.1971,p.19).

NoL335/32 OfficialJournaloftheEuropeanCommunities 14.12.74
inDM1000000
—aidinrespectofequalizationofburdens
(Lastenausgleich )payments 21-0
—closurepremiums 75-0
Total96-0concludedexclusivelybetweenundertakingswhich
didnotbelongtoRAG;whereassuchprice
agreementsdidnotariseasaresultofthespecial
aidgrantedtoRAGbutareanindirectresultof
competitionbetweentheGermancoalindustryas
awholeandcoalandotherenergysubstitutes
importedfromnon-membercountries;whereasthe
pricesappliedbyRAGdonotenableittoundercut
thepricesoftheimportedenergysubstitutes;
Whereas,inviewofthesituationprevailingin1972,
theCommission hasnoreasontodoubtthatthe
commonmarketincoalisfunctioningproperly;that
itcouldbecomenecessary,inorderthatthecommon
marketincoalmaycontinuetofunctionproperly,
toimposelimits;whereasitwould,however,like
toremindtheFederalGovernmentonanyfurther
increaseinthedifferencesbetweenaidsgrantedto
individualundertakings ;Aidtowatersupplyundertakings inre­
spectofexpenditureincurredinremoving
undergroundwaterfromclosedpits30-0
Premiumstostaffinrespectofshifts
workedunderground (coal-winning
premium) 110-0
Investmentaidstoindividualprojects
underanoverallinvestmentprogramme 160-0
PaymentoftheinstalmentsowedbyRAG
inrespectofstate-guaranteed compen­
sationtotheformermine-owning
companies 56*9Whereasithasalsobeenfoundthat:
—thepriceschargedbyRAGforcokingcoaland
boilercoaldonotamounttoindirectaidto
industrialconsumersofcoal;
theclosureoffiveunprofitablepitsbelongingto
RAG(annualoutput—approximately five
millionmetrictons)in1972hasledto
rationalization andconcentration ofproduction
onpitswhereproductivityishighest;Whereastheaidslistedabovesatisfytherequire­
mentssetoutinArticles6to9ofDecision
No3/71/ECSCinrespectoftheadmissibilityof
suchsupportmeasurestakenbyaState;
Whereastheaidtobepaidthroughthe'Aktions­
gemeinschaft DeutscheSteinkohlenreviere 'maybe
grantedonlyonconditionthatitisusedin
connectionwith'atotalorpartial'closureofpits'
(Article6(1)ofDecisionNo3/71/ECSC);Whereasitcanthereforebesaidinconclusionthat
thereleaseofDM650million 'fromthespecially
createdstabilization reserve—thatisfundstobe
providedunderRAG'sregisteredclaim—inorder
tocoveroperatinglossessustainedin1971and
1972iscompatiblewiththeproperfunctioningof
thecommonmarket;'
Whereastheamountsofsuchaidsdonotexceed
thepermissiblelevel;
Whereas,furthermore ,theGovernment ofthe
FederalRepublicofGermanynotifiedtheCom­
mission,pursuanttoArticle2ofDecisionNo
3/71/ECSC,ofthefinancialinterventions ,director
indirect,proposedforthebenefitofthecoal
industryduring1973;whereastheaidslistedbelow
aresubjecttoauthorizationpursuanttotheDecision
referredtoabove:Whereasasregardstheaidinrespectof
'equalization'paymentsthegovernmenthastaken
intoaccountthefactthattheclosureofapit,leads
tothedestructiontoaconsiderabledegreeofthe
originalfixedassets;whereastheaidwhichconsists
intheremissionoftwo-thirdsofthelevypayable
onassetsand'creditgains'(Vermogens-undKredit­
gewinnabgabe )totheEqualizationFund(Lasten­
ausgleichsfonds )isinanycaseconsiderablylower
thantheamountofcapitallostasaresultofthe
closureofthepitsandisthereforewithinthelimits
laiddowninArticle6ofDecisionNo3/71/ECSC;Aidsasfollowstobepaidthroughthe'Aktionsge­
meinschaftDeutscheSteinkohlenreviere GmbH'in
respectofpitclosure:

14.12.74 OfficialJournaloftheEuropeanCommunities NoL335/33
undertakingsofanoptimalsizewithinthemeaning
ofSection18oftheLawof15May1968concerning
theredeploymentandrecoveryoftheGermancoal
industryandtheGermancoalminingregions;
whereastheundertakingsmayusetheaidonlyfor
investmentsinpits,auxiliaryinstallations and
processingplant;Whereasamaximumof30%of
purchasecostsand/ormanufacturing costsinrespect
oftheinvestmentprojectsmaybecovered 'bythe
aid;Whereastheclosurepremiumpaidtotheunder­
takingsinthecoalindustrybytheAktiqnsgemein­
schaftDeutscheSteinkohlenreviere inrespectofthe
closuresamountstoalumpsumofDM15per
metrictonproduced;whereasthisamountwas
calculatedonthebasisofthebalancesheetofthe
RuhrkohleAGfor1971;whereasthisgivesthe
followingpictureofthefutureobligationsofthe
undertakings inthecoalindustryinrespectof
miningdamage,pensionsandminers'concessionary
coalallowances ;
Continuingobligationsinrespectofminingdamageand
socialchargesWhereasitisnotyetpossibletoindicatehowthe
aidfor1973willbeapportionedamongthe
individualprojects;whereasthiswillnotbepossible
beforetheenddf1973;inDMpermetrictonproduced
1969 1970 1971
Miningdamage 10-5812-1613-29
Pensions 5-625-546-47
Miners'concessionary
coal 6-116-056-29
Total22-3123-7526-05Whereasthepurposeandamountoftheaidapplied
forshowthatthismeasureiscompatiblewiththe
provisionsofArticle7(2)ofDecisionNo3/71/
ECSC;whereastheFederalGovernment isbound
tonotifytheCommissionatleastonceayearin
thecaseofeachprojectoftheobjectivespursued,
theamountsinvestedandtheamountofaidgranted;
Whereasprovisionhasbeenmadefor1973forthe
publicauthoritiesinlieuofRAGtopayan
instalmentofDM56-9milliontotheformerpit
owners,whohaveastate-guaranteed claimto
compensation vis-a-visRAG;
Whereasin1972RAGsufferedlossesandwillonce
againsufferhighlossesin1973;Whereasthe
paymentoftheinstalmentsbythepublicauthorities
istoberegardedasameasureaimedatpreventing
RAGfrombecomingbankruptandthereby
jeopardizingthejobsofapproximately 160000
persons;Whereasitisonlythechargeslistedabovewhich
exceedtheclosurepremiumofDM15permetric
tongrantedbytheFederalGovernment ;
Whereasthelumpsumaidgranteddoesnot
thereforeexceedtheexpenditureontheclosureof
pitsandisthereforecompatiblewiththeprovisions
ofArticle6(2)ofDecisionNo3/71/ECSC;
WhereasthepaymentofaidamountingtoDM30
millionfortheremovalofundergroundwaterfrom
closedpitsislikewisecompatiblewithArticle6(1)
ofDecisionNo3/71/ECSC:
Whereastheaidtowardsthepaymentofthecoal­
winningpremiumhelpsthecoalindustrytoachieve
astablesituationasregardsqualifiedworkers,which
isabsolutelyimperativeifitsproductivity isto
increase;whereastheundertakings aremoreover
involvedinexpenditureontherecruitment,training,
retrainingandretentionofstaffwhichgreatly
exceedstheamountofthecontribution tothis
premium;
Whereasthepurposeandamountofthecoal­
winningpremiumshowthatthismeasureis
compatiblewithArticle7(3)ofDecision
No3/71/ECSC;
Whereasthepurposeoftheinvestmentaidsisto
increasetheeconomicviabilityoftheGermancoal
industry;whereassuchaidistobegrantedtothoseWhereaspaymentbytheFederalGovernmentofthe
instalmentsinrespectofstate-guaranteed compen­
sationisthereforecompatiblewiththeprovisions
ofthefirstsubparagraph ofArticle9(1)of
DecisionNo3/71/ECSC;
Whereasasregardstheappropriations oftheaid
havingregardtothedifferencebetweenproduction
costsandrevenueitisfoundthattheaidwillcover
onlyafractionoftheoperatinglosseswhichRAG
canbeexpectedtohavesustainedduring1973;
whereassuchaidisthereforecompatiblewiththe
provisionsofArticle9(2)ofDecisionNo
3/71/ECSC;

NoL335/34 OfficialJournaloftheEuropeanCommunities 14.12.74
Whereas,pursuanttoArticle11(1)ofDecision
No3/71/ECSC,theCommissionmustensurethat
'theaidsauthorizedareemployedforthepurposes
setoutinArticles6to9ofthatDecision;whereas
theCommissionmustbeinformedinparticularof
theamountoftheaidandofthemannerinwhich
itisappointed,
HASADOPTED THISDECISION :Whereastheexaminationofthecompatibility of
theGermanaidwiththeproperfunctioningofthe
commonmarketmustincludealldirectandindirect
measurestobetakenforthebenefitofthecoal
industryin1973(Article3(2)ofDecision
No3/71/ECSC);
Whereasonthatbasisofcalculationthetotalcost
oftheproposeddirectandindirectmeasures
amountsto410*2millionunitsofaccount,i.e.
4-04unitsofaccountpermetrictonproduced;
whereasthismeansa3-5%increaseinthetotal
amountofaidcomparedto1972;whereasthe
amountofaidpermetrictonwillrisefrom
3-65unitsofaccountto4-04unitsofaccounti.e.by
10-7%;
WhereastheGermancoalindustryreceiveslessaid
(permetricton)thantheBelgian,FrenchandDutch
industries;whereastheGermanaidsare,however,
twiceashighasthosegrantedintheUnited
Kingdom;
Whereasthefollowingremarkscanbemadeonthe
compatibilityofthetotalamountoftheGermanaids
withtheproperfunctioningofthecommonmarket;
—suchamountisconsistentwiththetonnage
forecastsfor1973,havingregardtotheCom­
munity'soverallsupplypositioninrespectof
cokeandcoal,sothattherequirements ofthe
firstsubparagraph ofArticle3(1)ofDecision
No3/71/ECSCaresatisfied;
—therehasbeennonoticeabledeclineintradein
coalbetweentheFederalRepublicofGermany
andtheotherCommunitycountriesin1973;
—asregardsthepricesofGermancoal,moreprice
alignmentagreementswereconcludedin1972
thanin1971;
—thepricesofGermancokingcoalandboiler
coalin1973didnotamounttoindirectaidto
industrialconsumersofcoal;
—theclosureofunprofitablepitswillleadto
rationalization andtheconcentration of
productioninpitswhereproductivityishighest;
Whereasitcanthereforebeconcludedthatthe
Germanaidsforthebenefitofthecoalindustry
arecompatiblewiththeproperfunctioningofthe
commonmarket;
Whereasthisappliesevenwhenaccountistaken
ofthoseaidspaidtothecoalminesunderDecision
No73/287/ECSC;Article1
TheGovernment oftheFederalRepublicof
GermanyisherebyauthorizedtogranttoRAGin
respectofthecalendaryears1971and1972aidin
anamountofDM650milliontocoveroperating
losses.Thefollowingaidsmaybegrantedinrespect
ofthecalendaryear1973forthebenefitofthe
Germancoalindustryasawhole:
1.remissionoftwo-thirdsoftheobligationsofpits
duetobeclosedinrespectofthelevyonassets
and'creditgains'(Vermogens-undKreditge­
winnabgabe);
2.paymentofaclosurepremium,inanamountof
DM15permetrictonproduced,throughthe
'Aktionsgemeinschaft DeutscheSteinkohlen­
reviere';
3.reimbursement ofthecostofpumpingout
undergroundwaterfromclosedpits,uptoa
maximumofDM30million;
4.partialremissionofthewagestaxduefrom
undertakings inthecoalindustry;uptoa
maximumofDM110million;
5.grantofinvestmentaidinanamountnot
exceedingDM160milliontoundertakings in
thecoalindustryinordertoencourage
investment ;
6.paymentofinstalmentsowedbyRAGinrespect
ofthestate-guaranteed compensation ofthe
formermine-owning companies,uptoa
maximumofDM56-9million.
Article2
TheFederalGovernmentshallnotifytheCommission
by30November1974ofdetailsoftheaidsgranted
pursuanttothisDecision,inparticularasregards

14.12.74 OfficialJournaloftheEuropeanCommunities NoL335/35
theamountspaidandthemannerinwhichsuch
amountsareapportioned .
Article3
ThisDecisionisaddressedtotheFederalRepublic
ofGermany .DoneatBrussels,16October1974.
FortheCommission
ThePresident
Fran^ois-Xaviei ORTOLI