ARCHIVESHISTORIQUES
DELACOMMISSION
COLLECTION RELIEEDES
DOCUMENTS "COM"
COM(82)344
Vol.1982/0124

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COMMISSION OFTHEEUROPEAN COMMUNITIES
COM(82)344 final
Brussels,2ndJune1982
SECONDREPORTONTHEAPPLICATION OFTHERULES
FORAIDSTOTHESTEELINDUSTRY
ADDENDUM
(Communication fromtheCommission totheCouncil)
COM(82)344final

Application oftheSteelaidrulesintheperiod1.1.1982-31.5.1982
1.Theattached tabl^whichhasbeendrawnupattherequestoftheCouncil ,
givesdetailsofcasestreatedbytheCorimission underDecision No2320/
81/ECSCinthefirstfivemonthsof1982.Itshouldbereadinconjunction
withthe2ndReportontheapplication oftherulesforaidstothesteel
industry (COM(82 )34final,5February 1982)towhichitis,essentially ,
anaddendum .Wheretherehavebeenfurtherdevelopments incasesmentioned
inthe2ndReport,appropriate references aregiveninthetable.Where
nomentionismadeofcases'whichappeared inthe2ndReport,.thesituation
remains asitwasstatedthere.
2.Newaidcasesindicated inthetableconcernBelgium (2},theFederal
RepublicofGermany (5),France (3),Ireland (1),Netherlands (1)andthe
UnitedKingdom (1).ForItaly,moredetailsaregivenoftheaidsmentioned
brieflyattheendofpara3.2.4.ofthe2ndReport.Ifcetableshowsthat
eightprocedures havebeenopenedandfourteen aidsapproved inwholeor
mpart.
3.Duringtheperiod1.1.1982-31.5.1982,fivemulti-lateral meetings
wereheld.Aidschemesorindividual aidsproposed byallsixofthe.Mornbar
Statesmentioned abovewejrediscussed atthesemeetings ,atwhichConcus­
sionofficials alsogaveMemberStatedelegates oralreportsonnewnoti­
fications received anddecisions taken.
4.Duringthepast18months,asaresultoftheapplication ofDecisions
257/80/!CCSCand2320/8l/ECSC,netcapacity reductions achieved orpromised
intheareaoffinished products amounttoslightly over4milliontonnes.
Discussions betweentheCommission andtwoMemberStates,atpresentnearin.j
completion ,mayresultinfurtherreductions ofabout1milliontonnes.

APPLICATION OFSTEEL AIDS CODE INTHE PERIOD 1.1.1982 -31.5.1982
Member StateReference in
2ndReport (ifany )Cases treated Remarks -
BELGIUM Para 3.2.1 . Cocker ill-Sarbre
-Authorisation of2ndtranche ,con­
sisting of :FBbnRevised financial andindustriad plan forC-S
tobesubmitted toCommission by31May1982 .
-'(i)Investirent aid (convertible
bonds andguarantees ) 9.9
(ii)Continued operation (debt con­
version ,bonds ,loan ) 29.3
(iii )Social aid (interest relief
andguarantees ) 2.5
41.7
Netcapacity reduction of1.075 n/tofhot-
rolled products ,after deducting 1.2m/tin-
crease atCariam .Belgian government agreed toabandon thefol-#
lowing aidproposals :
-interest relief onloan
(FB7bn)at (ii);
-2-year extension ofpayment byState ofin-
terest onlong-term debts ofC-S ;
-régional aids under Economic Expansion Law
•forinvestment expenditure .
-Article 8(3 )procedure opened inrespect of
draft heads ofagreement between Belgian
government andprivate banks concerning cre­
dit facilities forC-S .Only that part which gives C-Saccess tonew
credit (BF9bn),guaranteed bytheState ,is
covered bytheprocedure .
Tobeassessed in,context ofrevised plan men-
tioned above .
Para 2.2.1 . Itiree individual investment aids (ALZ ,UTM ,
Phénix ).
Proposal togrant regional aids (interest re­
lief andguarantees )andconvertible bonds .
Article 8(3 )procedure initiated forallthree .
Phénix :Closure ofArticle 8(3 )orocecure men-Problems regarding theextent ofcapacity re-
duction andrestructuring proposals
tioned above andofearlier Afticle 93(2 )EEC
procedure (included in1stReport ,para 2.2.3 .)
1
Aidauthorised :(rcxjional )T%interest relief
andguarantee onloan ofRF1.04 bn;
convoi' tiblobonds ,W0.76 bn.Installation ofnewpre-painting line (127,000
tonnes ),offset byclosure ofexisting line
(27,000 tonnes )andofsheet mil (160,000 ton­
nes ).
I

J
-2-
MemberStateReference in
2ndReport (ifany)Casestreated Remarks
BELGIUM
(continuation )
ΛPara2.2.1.
(also1stReport,
para2.2.3.)Sidnar:ClosureofArticle 93(2)EECproce­
dure.
Aidauthorised :(regional )interestreliefon
loanofBF4.8bn,guarantee onEF3.2bn,
taxconcessions .
1
Laminoirs deJemapbes andLaminoirs deSt.EloiCreationofnewcontinuous annealing capacity
of470,000tonnes,offsetbyputtingintore­
serve520,000tonnesofexistingcapacity ,re-
useofwhichissubjecttopriorapproval by
Commission .
Interestreliefreducedfrom7to3percentage
points.
Problemwithregardtocapacityreduction and
restructuring ;operating aidsproposedto
lastmorethan2years(Article 5)./Procedure ofArticle93(2)EEC-guarantee for
BF140m-remainsinforce:2ndReport
para3.2.1.7.
Problemwithregardtocapacityreduction and
restructuring .Article8(3)procedure .initiated inrespectof
proposedaidsfor(i)continued operation ,
(ii)investment .!
Jemaooes :
(i)guarantees ,capitalincrease,convertible
bonds-BP670million;
(ii)(regional ):guarantee onEF275m,7%
interestreliefonloanofBF206.5ra.
St.Eloi: ·
(i)paymentbyStateofinteresttotalling
BF45.8m,convertible bondsBF101m.
(ii)(regional ):guarantee onloanofBF20m,
7%interestreliefonloanofBF15m.

MemberStateReference in
2ndReport (ifany)Casestreated Remarks
R.F.GERMANY
•1·
::ΚPara2.2.2.
Para2.2.2.(Investment aidforfourundertakings )
Threecaseswithdrawn byGermangovernment .
Article8(3)procedurestillinforceinre­
spectofre-naming case(Wuppermann ).
Aidproposed :reducedinterest loanof
DM4.1million,8years,2yearsgraceperiod,
interestrate8.75%.
Authorisation ofthreeindividual casesof
investment aid.
Berlin: t
Investment grantofDM1millionandreduced
interest loansofDM2.97million(8years,
1to2yeargraceperiod,interestrate7.5%
to8.5%).
Baden-Württenbera :Problemregarding compensating capacity reduc-
tion.
Largelynon-ECSCproducts.
Closureofelectricarcfurnace (20,000tonnes)
Energy-saving investment .
Closureoflight/mediumsectionmill(245,000
tonnes)andadditional reduction of75,000
tonnesofcapacityforreinforcement steelin
coils:increaseof217,000tonnesofwire-rod
capacity .
Netcrudesteelcapacityreduction of600,000
connes.
•ι .1Guarantee onECSC-loan ofDM5million.
Nordrhein-Vtestfalen :
RegionalgrantsofDM6.231million
\

-4-
MsjrberStateReference in
2ndReport(ifany)Casestreated Renarks
R.F.GERMANT
(continuation )Para3.2.2.
Para3.2.2.
Para3.2.2.Bavaria (Maxinilianhutte ):
Authorisation offullamountofR+Daid
(DM38million).
U-
Saar:
Authorisation ofguarantees ofDM210million.
saar:
Authorisation ofsupporttariffsuntilendof
1984(1).
Approvalofinvestment aidscheme
(10%grants). ~•
Forprojectsofrestructuring ,modernisation
orrationalisation involving capacityreduc­
tion.TheCommission haddemanded areduction ofthis
aidfromDM38mtoDM29m.Furtherinformation
showedthatasubstantial partoftheinvest-
ment-related aidsfortheR+Dprograme wasre­
payable.Theintensity oftheaidwastherefore
lesshighthanoriginally calculated .The
authorisation wasconditional onstrictadhe­
rencetotherepayment andotherconditions
formingthebasisofthenewintensity calcula­
tion. --
Capacityincreaseof61,000tonnes (heavysec­
tions)offsetbyreductions inwirerod
(173,000tonnes)andlightsections (44,000
tonnes).
ihesupportelementcontainedin
thesetariffswill-bereducedby50%on
1.1.1984 andabolished on31.12.1984 .Theori­
ginalschedule wasreduction by1/3on
1.1.1982 ,1/3on1.1.1983,abolition on
1.1.1984 .
Allindividual casestobenotified tothe
ODmmission withinthetime-limit ofDecisionk>2320/81/ECSC.
(1)ThisaidwasapprovedunderArticle70,4thparagraph ,oftheECSCTreaty,andnotunder
Decision No2320/81/ECSC.Itisincludedhereforthesakeofcompleteness .

Member StateReference in
2ndReport (ifany )Cases treated Remarks
R.F. GERMANY
(continuation )
. IκGusstahlwerk Remy :
authorisation ofreduced interest loan of
DM0.125 million ,4years ,1year grace period ,
interest rate 8.25 %.
Hamburqer Stahlwerke :
Notification ofinvestment aid (reduced in-
terest loan ofDM8m,8years ,2,years grace
period ,interest rate 9.25%).SC
Peine-Sal zaitter : ι
Artide 8(3 )procedure opened inrespect "of
proposed investment aids ofDM4.34 m(regio­
nalandgeneral investment scheme )andreduced
interest loan ofDM12.9 m(8years ,2year
grace period ,interest rate 8.25 %).
Approval ofaResearch andDevelopment Aid
Scheme :
Grants ,insome cases repayable ,ofupto509»
ofthecost ofR+Dprogrammes .
Budget DM600m,spread over 1982-85 .Annealing canacity reduced by2,760 tonnes
(=>48%).
Further information sought bytheComi ssion ,
notably astocapacity .
Problem regarding capacity reduction ,andre-
structuring plan notfinalised .
All individual cases tobenotified within the
time limit setby'Decision No2320/81/ECSC .
Possibility ofstreamlined notification proce­
dure for small cases tobediscussed .
'1

-6-
Me.TberStateReference in
2ndReport (ifany)Casestreated Remarks
FRANCE
ICFPS:
Article8(3)procedureinitiated inrespectof
proposedaid(participatory loanofFF150m)
forrestructuring progranme .
11
UsL-jor:
Article8(3)procedureinitiated inrespectof
loanforpurchaseofmajorityholdingin-ugineA¿iers. -
Loan:FF310m,20years,5yearsgraceperiod
interestrate2%first5years,3%thereafter ./Seealsopara3.2.3.of2ndReport.IheAr­
ticle8(3)procedure mrespectofaloanof
FF450mmentioned thereremainsinforce.?
Doubtsaboutviability ofcocpany.Proposals
mustbeassessedinconjunction withtheover­
allrestructuring planforFrenchsteelindus­
try.(TobenotifiedinJune1S82).
ν ■ Problemsregarding therestructuring tobe
undertaking andtheviability oftheenter-
prises.
Proposals needtobeassessedinconjunction
withtheoverallrestructuring planforFrench
steelindustry.
rUsinor/Sacilor :
Article8(3)procedureinitiated inrespectof
loanforpurchaseofsharesinSociétéMétal­
lurgique deNormandie ,
loan:FF363m,20years,5yearsgrace
period,interestrate1%.»
-Asabove. .
r ■
*\

J 1- ι
,
-7-
Member StateReference in
2ndReport (ifany )Cases treated Remarks
IRELAND Irish Steel Ltd .:
•Authorisation ofaidtocontinued operation :
IR&30πιforwriting-off ofdebt ;
Increase ofIRfc15minlimit ofState gua-
rantees for .loans ,
r > · . .
C&pacity reduction :56,000 tonnes of
galvanising capacity .
!
•
•Increase ofIRL25mincapital notapproved .
Independent study tobecarried out todeter -
mine long-term viability ofISLandtoform
basis ofthefinal proposals ofIrish govern­
ment viiich must benotified totheConmission
before 30September 1982 .
•
•
•■•
\
V4 \
•

«j
-8-
MerfcerStateReference in
2ndReport (ifany)Casestreated
-ITALY Para3.2.4. Finsider
Article8(3)procedure openedinrespectof
following proposedaids:
capitalincrease -LIT4939bn
regional aids -LIT231bn
sectoral aids -LIT831bn
socialaids(relief-LIT450bn(ofwhich
fromindirect LIT211bnforFinsider )
charges)
Aidfordismantling ofcapacity
Article8(3)procedure initiated inrespectof
proposed aidof
LIT100,000pertonneofcrudesteelcapacity
dismantled ,
LIT150,000pertonneofproductscapacitydis
mantled.
Budgetary allocation LIT300bn.Remarks
LIT350bnofcapitalincreasealready
approved (2ndreport)withcapacityreduction
of130,000tonnesofrolledproducts.
Problemsregarding capacityreduction and
viability. j
/Procedure inrespectofLITZQ00mbondswith
reducedinterest remainsinforce:2ndreport
para3.2.4.7

~3-
MemberStatejreference in
[2ndReport (ifany)
N;3THERIANDS
UNITED
KINX3D0MCasestreated
Notification ofaidinformofcxantof20%
(max.HFL4.07m)formodernisation andratio-
nalisation programme .
Ttotalcostofprogramme HFL30.5mofwhich
HFL18.5mattracts aid.
Proposedcapacityreduction :170,000tonnes
ofcrudesteel.
ApprovalofPrivate .SectorAidSchemewhich
makesprovisionforj:
Socialaids(redundancy costs):grantof85%
(=44%net)ofstaturory costs.
Aidsforclosures Jgrantof25%of
Aidforrestructuring 5netcosts
'K>talbudget :UKL22million
Capacity reduction :dependsontheresponse
byundertakings tothescheme;willbenoti­
fiedforeachindividual case(see'Remarks').«taoarks
Underexamination byConnissicn .
Priornotification befoa30September 1982
ofallindividual casesofclosure andre­
structuring aidisrequired.
25%grantrateconsidered asamaximumby
theConmission ,notasautomatically applic­
able.