WRITTEN QUESTION E-2291/99

by Carlos Carnero González (PSE) to the Commission

(13 December 1999)

Subject: Future of shipbuilding in Europe

On 5 November 1999, the European Trade Union called a four hour strike in the shipbuilding industry, on behalf of the sector's viability, under the slogan WORK FOR SHIPYARDS: A FUTURE FOR EUROPE, and on 9 November, the Council of Industry Ministers assessed the situation of European shipbuilding. A two-hour strike had taken place on 27 October in Spain, a country with a long history of major commitment to shipbuilding, in all the yards belonging to the Spanish Shipbuilders' Group, (Grupo Astilleros Españoles) to draw attention to their viability, and to protest against the privatisation of Astander by the Sociedad Español de Participaciones Industriales. At the same time, it was announced that the Commission was demanding that the Spanish Government return over 18 billion pesetas granted to the shipbuilding sector as tax credits, claiming that they were state aids.

The need to guarantee a future for the shipbuilding industry should be an absolute priority of the European Union, for economic, social and employment reasons. This needs to be achieved by mutual agreement with the trade union leadership, and guarantee, above all, employment in a competitive public sector.

Can the Commission answer the following:

1. What measures can it put forward to guarantee the viability of shipbuilding, following the November Council meeting?

2. What steps will it be taking in the wake of the Council meeting of 9 November?

3. Is it maintaining its position vis-à-vis the return of the tax credits in question, and what talks has it held on this subject with the Spanish Government?

4. Is it aware of the privatisation of Astander, and does it seriously believe that dismantling the public sector is the right way to guarantee production and employment?

5. What is it's opinion of the dumping practised by countries like Korea and Japan in this area?

Answer given by Mr Monti on behalf of the Commission

(10 January 2000)

The Commission set out its general approach towards improving the competitiveness of the Community shipbuilding industry in its communication Towards a new shipbuilding policy(1) and the accompanying proposals which gave rise to Council Regulation (EC) No 1540/98 of 29 June 1998 establishing new rules on aids to shipbuilding(2). The Commission believes that that approach remains valid.

Nevertheless the Commission is very concerned about the current difficult world market situation caused by over-capacity and low prices, as well as possible unfair competition from elsewhere such as injurious pricing. At the 9 November 1999 Industry Council the Commission presented a first report on the situation together with a series of possible measures to address the problems.

The Council shared the Commission's concerns and called for the following actions: the Commission to pursue its efforts to establish a level playing field for the sector by immediately engaging Korea in constructive consultations with a view to halting the unfair competition; industry, Member States and the Commission to seek as much detailed evidence as possible of the alleged anti-competitive behaviour, in order to take appropriate action under the World trade organisation (WTO); Member States to urge the International monetary fund (IMF) and World Bank to continue to investigate whether the conditions and assumptions for IMF rescue packages are fully respected; Member States and the Commission to pursue their efforts to establish a level playing field for the sector in the appropriate international fora, including the Organisation for economic cooperation and development (OECD), in order to enforce, without delay, fair competition rules. The Council also welcomed the Commission's determination to continue to meet its obligations under Article 12 of Council Regulation (EC) No 1540/98 and to report on developments as soon as necessary.

As for the Honourable Member's specific questions about Spanish yards, the Commission is aware of the sale of the Astander yard. This privatisation is a matter for the Spanish government. So far as the Commission's recent decision(3) on tax credits is concerned, the Commission acted only after very careful study and extensive consultations with the Spanish authorities. It concluded that the aid had been granted in breach of the conditions attached to a previous aid decision approving restructuring aid to the publicly-owned yards in Spain. Faced with such a situation, the Commission was obliged to react.

(1) COM(97) 470 final.

(2) OJ L 202, 18.7.1998.

(3) C3(99) xnu 145/98.