WRITTEN QUESTION P-2005/00

by Adriana Poli Bortone (UEN) to the Commission

(16 June 2000)

Subject: Law No 196 of the 1997 TREU Package

Given that the Official Journal of the European Communities(1) publishes the Commission decision of 11 May 1999 (2000/128/EC) concerning aid granted by Italy to promote employment through training and work experience contracts, both as regards fixed-term contracts awarded since November 1995 and as regards the conversion of such contracts from fixed-term contracts to open-ended contracts under Article 15 of Law No 196 of 24 June 1997 (TREU Package), and in view of the fact that the Mezzogiorno is one of the regions of Europe with the highest level of unemployment, that there are numerous businesses in the Mezzogiorno which have entered into training and work experience contracts since November 1995 under an Italian law (L 863/84) which laid down access requirements and implementation arrangements at odds with those established by the Commission, that such businesses would be heavily penalised merely for complying with the laws of the Italian State, that the punitive recovery of the aid granted to those businesses, over the past 15 years, would mean their certain financial collapse and the further loss of thousands of jobs, what decisions does the Commission intend to take in order to prevent possible damage to the businesses of the Mezzogiorno?

(1) OJ L 42, 15.2.2000.

Answer given by Mr Monti on behalf of the Commission

(18 July 2000)

By decision of 11 May 1999 (2000/128/EC) concerning aid granted by Italy to promote employment(1), the Commission found that the aid for recruitment through training and work experience contracts was compatible with the common market provided it concerned the creation of new jobs within the recipient firm for workers who had not yet found employment or had lost their previous job, or the recruitment of workers experiencing particular difficulties in entering or re-entering the labour market. As regards aid to help convert training and work experience contracts into open-ended contracts, the Commission found that it was compatible with the common market provided it satisfied the obligation to achieve a net increase in stable employment in relation to jobs already existing in the firm.

All aid for recruitment through training and work experience contracts and for the conversion of training and work experience contracts into open-ended contracts that did not comply with the above-mentioned requirements was deemed incompatible with the common market; it must therefore be recovered in order to restore the competition that existed before the unlawful aid adversely affected Community trade and distorted competition.

In its decision on the aid scheme described above, the Commission took account of the specific problems relating to the economic and employment situation in the Mezzogiorno.

As regards the aid deemed incompatible with the common market, Council Regulation (EC) No 659/1999 of 22 March 1999 laying down detailed rules for the application of Article 93 of the EC Treaty(2) states that, where negative decisions are taken in cases of unlawful aid, the Commission must decide that the Member State concerned take all necessary measures to recover the aid from the beneficiary.

(1) OJ L 42, 15.2.2000.

(2) OJ L 83, 27.3.1999.