WRITTEN QUESTION E-1942/99

by Isidoro Sánchez García (ELDR) to the Commission

(4 November 1999)

Subject: Implementing specific measures for the ultraperipheral regions in the field of state aid

Article 299(2) of the Treaty obliges the Commission to put forward specific measures for the ultraperipheral regions, including in the field of state aids, in order to ensure that the application of the Treaty provisions take due account of the particular difficulties faced by these regions, including their remoteness, insularity, small size, difficult topography and climate and economic dependence on a few products. Clearly, transport problems are not the sole specific problem caused by these factors, both singly and in conjunction, operational subsidies are essential to compensate for all these disadvantages, since such aids are intimately linked to the running costs which companies located in these regions have to shoulder.

Current regulations on aids make no provision for this situation, because the new wording of paragraph 299(2) of the Amsterdam Treaty was not in force when they were adopted. Does the new Commission intend to take these problems into account and incorporate them into any proposal it may make?

Answer given by Mr Monti on behalf of the Commission

(29 November 1999)

The Commission has always shown itself highly attentive to the problems of the Community's outermost areas.

Special arrangements are made under the guidelines on national regional aid, namely:

- exceptions to the maximum aid intensities: the outermost regions qualify for an increase of 15 percentage points on the intensity authorised for the other regions eligible for a derogation under Article 87(3)(a) (former Article 92) of the EC Treaty: in the case of large firms, aid may amount to as much as 65 % of the net grant equivalent (nge) for the investment concerned instead of 50 %; in the case of small and medium-sized firms, the intensity may be as much as 75 % nge;

- the possible granting of operating aid to offset partially the additional transport costs, without any time-limit or degressivity, provided that the region concerned is eligible for the exemption under Article 87(3)(c).

Article 299(2) (former Article 227) of the EC Treaty provides that the Council, acting by a qualified majority on a proposal from the Commission and after consulting the European Parliament, shall adopt specific measures aimed, in particular, at laying down the conditions of application of the present Treaty to those regions. The Cologne European Council called on the Commission to present to the Council before the end of 1999 a report on the measures for implementing Article 299(2).

On 23 November the Commission President initiated a dialogue on this subject by holding a partnership meeting which was attended not only by the French, Portuguese and Spanish authorities but also by representatives of the seven outermost regions and the Members of the European Parliament from those regions.

The Commission is now studying the proposals submitted to it.

At the partnership meeting the Commission President announced that in December 1999 the Commission would discuss the report requested by the Cologne European Council.