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DOCUMENTS "COM"
COM(73)1310
Vol.1973/0246

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COMMISSION OFTHEEUROPEAN COMMUNITIES
COM(73 )1310 final
Brussels ,11September 1973
COMMISSION DECISION
of11September 1973
onaidwhich theBelgian Government intends togrant for
extending anoilrefinery atAntwerp (province of
Antwerp )andforsetting upanewrefinery at
Kallo (province ofEast Flanders )
COM(73 )1310 final

C027TS3I0I *yvjIHT : •
of11September 1973
1973
onaid which theBelgian Government intends togrant
forextending anoilrefinery atAntwerp (province of
Antwerp )andforsetting upanewrefinery atKallo
(province ofEast Flanders )
THE COMMISSION OFTHE EUROPEAN COMMUNITIES ,
Having regard totheTreaty establishing the European Economic Commu­
nity ,andinparticular thefirst subparagraph ofArticle 93(2 )there­
of5
Having ,pursuant toArticle 93»given notice tothe parties concerned
tosubmit their comments and having considered those comments ;
I,Whereas ,byletter of23August 1972 from its Permanent Representa­
tive ,theBelgian Government ,pursuant toArticle 93(3 )EEC ,in­
formed theCommission ofits intention togrant certain aid for in­
vestments made bytwo oil companies ,the one for extending anoil
refinery atAntwerp and the other for setting upanew oilrefinery
atKallo ;
Whereas therefining capacity inBelgium will beconsiderably in­
creased asaresult ofthose investments ;
Whereas the information supplied bytheBelgian Government indicates
that the aid inquestion will begranted pursuant totheLaw of17
July 1959 instituting and coordinating measures toencourage econo­
micexpansion and thesetting upofnew industries ;

-2 -
Whereas the aid will consist :
-inthe case oftheAntwerp refinery ,ofinterest rate subsidies
of2%forthree years onaloan ofBfrs .4.570 million andof
3%forthree years onaloan ofBfrs .1.^30 million andalso
exemption forthree years from the tax onland andbuildings ;
-inthe case oftheKallo refinery ,ofaninterest rate subsidy
of2%forthree years onaloan ofBfrs .4,300 million and Eilso
exemption for three years from the tax onland and buildings ;
Whereas the aids are such astoaffect trade between Member States
and tothreaten todistort competition within the meaning ofAr­
ticle 92(1 ).
II.Whereas the economic and social situation ofthe regions and areas
inwhich the new investments receiving aid are located are not
such aswould warrant applying the exceptions made under Article
92(3 )(a)and (c)foraidtopromote thedevelopment ofcertain
areas tothe aids which theBelgian Government intends togrant ;
Whereas growth intheprovince ,and inparticular inthedistrict
ofAntwerp ,isvery rapid ;whereas ,inview ofthe investments
which have been made and which are likely tobemade inthis area ,
the current shortage oflabour may beexpected tobecome more
acute ;whereas the gross domestic product per inhabitant inthis
area isamong thehighest intheCommunity ;
Whereas expansion intheprovince ofEast Flanders andthe district
ofStNiklaas where Kallo islocated islikewise particularly ra­
pid ;whereas this province ,which ,through itsproximity ,benefits
from Antwerp 'sownexpansion ,isparticularly attractive fornew
investments ;whereas itssituation ,from the point ofview ofem­
ployment orstandard ofliving ofthepopulation ,does not give
rise toany concern ;

-3-
Whereas ,moreover thedistricts ofAntwerp and ofStNiklaas are
notwithin theregions orareas inrespect ofwhich theCommission ,
initsDecision 72/173/EECof26April 1972 onaidgranted under
theBelgian Law of30December 1970 oneconomic expansion ,autho­
rized theBelgian Government togrant regional aid .
III .Whereas ,firstly ,the refining industry and its undertakings face
noparticular difficulty inBelgium whether from the point ofview
oftheir structures oroftheir ownability toexpand ;whereas ,on
the contrary ,production capacities inBelgium already far exceed
the needs ofthe domestic market and the forecasts which are at
present possible oftrends inthese two variables during the years
ahead indicate that there will beancontinued surplus which will
even increase considerably ;
Whereas theCommission -inexercising thepowers vested initby
Article 92(3 )EEC-should nottherefore except from Article 92
(1)EECwhich provides fortheincompatibility ofaids defined in
that paragraph ,measures which would contribute tofurther the
development ofthis industry ,bygranting those measures thebene­
fit .oftheexemption provided under Article 92(3 )(c)EEC for "aid
tofacilitate thedevelopment ofcertain economic activities ",
there being nojustification forsuch measures ;

-k-
Whereas ,furthermore ,itis .characteristic ofthepetroleum industry that
when refining capacity isavailable there isadvantage inmaking the
maximum use ofitsince theproportional element inrefining costs is
relatively small ;iwhereas ,however ,ifthere areanysurpluses ,however
small ,onthemarlcet forpetroleum products those surpluses have a
considerable depressing influence onprices andaretherefore likely to
upset thefinancial equilibrium oftherefining industry oftheCommunity .
Whereas theaids planned bytheBelgian Government are therefore
such asto"adversely affect trading conditions toanextent con­
trary tothecommon interest "andcannot forthat very reason be
exempted under Article 92(3 )(c)EEC ,since this provision allows
aids tobeconsidered compatible with theCommon Market only if
they facilitate the development ofcertain economic activities
without producing anyadverse effect ;
Whereas ,moreover ,theaids clearly donotqualify forexemption
under Article 92(2 )orArticle 92(3 )(b)EEC ;
IV..Whereas ,when submitting its comments ,theBelgian Government
declared itself prepared tolimit theaids originally proposed
only toinvestments directed towards theelemination ,bythe two
refineries concerned ,ofthepollution they cause ;
/.

-5-
Whereas ,however ,itistheresponsibility ofMember States totake
thenecessary measures toensure that theundertakings themselves ,
under theprinciple of'the polluter pays' meet the costs ofprotec­
ting the environment from theharmful effects oftheir activities ;
whereas aids can beexempted from this rule only ifitcan beproved
that full application ofthe rule might give rise toparticular diffi­
culties ,especially ofaregional orindustrial nature ,and that those
difficulties canonly beovercome byenabling the industries concerned
tomake the necessary alterations totheir existing production plants .
Whereas ,inthis case under consideration ,anexamination ofthe si­
tuation ofthe undertakings which would benefit from the aids proposed
bythe Belgian Government ,oftheregions and areas where the new in­
vestments are tobemade and ofthe sector ofindustrial activity to
which theundertakings belong ,does not indicate that any such diffi­
culties exist ;
HAS ADOPTED THIS DECISION :
Article 1
The Kingdom ofBelgium shall not grant the aids which ,asnotified to
theCommission byletter of23August 1972 from itsPermanent Repre­
sentative ,itintended togrant towards the extension ofanoil re­
finery atAntwerp and towards thesetting upofanewrefinery at
Kallo .
Article 2
This decision isaddressed totheKingdom ofBelgium .
Done atBrussels ,11September 1973
For the Commission
Th ■;;Prosit nt
Francois -virvITOLI