2000/668/EC: Commission Decision of 12 July 2000 on State aid granted by Italy to shipbuilders in the form of tax relief under Law No 549/95 (notified under document number C(2000) 2448) (Text with EEA relevance) (Only the Italian text is authentic)
Date: 2000-07-12
Institutions: European Commission
Subjects: Italy, State aid, control of State aid, infringement of EU law, shipbuilding, tax relief

L 279/46

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Official Journal of the European Communities

1.11.2000

II

(Acts whose publication is not obligatory)

COMMISSION

COMMISSION DECISION

of 12 July 2000

on State aid granted by Italy to shipbuilders in the form of tax relief under Law No 549/95

(notified under document number C(2000) 2448)

(Only the Italian text is authentic)

(Text with EEA relevance)

(2000/668/EC)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European
Community, and in particular the first subparagraph of Article
88(2) thereof,

Having regard to the Agreement on the European Economic
Area, and in particular Article 62(1)(a) thereof,

Having given notice to the parties concerned to submit their
comments in accordance with the abovementioned provi-
sions (1), and having regard to those comments,

Whereas:

I. PROCEDURE

(1)

(2)

By letter dated 5 March 1996 from the Italian Perma-
nent Representation to the European Union, the Italian
authorities notified the Commission of Law No 549/95
introducing tax relief for certain firms (the Law).

By letter of 21 May 1997 the Commission informed
Italy that it had decided to initiate the procedure laid
down in Article 6(5) of Decision No 2496/96/ECSC and
Article 93(3)
(now Article 88(3)) of the Treaty) with
regard to the granting of this aid in sensitive industries,

(3)

(4)

(5)

(6)

including
synthetic fibres.

steel, motor

vehicles,

shipbuilding

and

The Commission's decision to initiate proceedings was
announced in the Official
the European
Communities. The Commission there asked interested
parties to submit their observations (2).

Journal of

The Commission received observations from interested
parties, which it forwarded to Italy for comment by
letter of 24 October 1997.

On 13 May 1998 the Commission adopted Decision
1999/148/EC, ECSC on State aid granted by Italy by way
of tax relief under Law No 549/95 to firms in the motor
vehicle, shipbuilding and synthetic fibres industries and
to steel firms covered by the ECSC Treaty (3). Article 3 of
that Decision requires Italy to provide the Commission
with all
the necessary information and explanations
enabling it to assess the compatibility with the common
market of the State aid granted to firms in the ship-
building, motor vehicle and synthetic fibres industries.

Following that Decision the Italian authorities issued
Circular No 218/E of 14 September 1998, which was
sent to the relevant trade associations and to local offices
of the Ministry of Finance, asking firms working in these
industries to contact the Ministry of Industry ‘in order to
enable the Ministry to pass on to the Community
authorities any information that might help them to
this tax relief with the
assess the compatibility of
common market’ (4).

(2) See footnote 1.
(3) OJ L 47, 23.2.1999, p. 6.
(4) Published in Gazzetta ufficiale della Repubblica italiana, No 216,

(1) OJ C 268, 4.9.1997, p. 4.

16.9.1998.

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(7)

(8)

(9)

tax

the

(where

The Italian authorities studied the information received
in reply to the Circular, and found that only two under-
takings within the scope of the relevant Community
rules had received tax relief. These were the shipyards
Clemna Soc. Coop. a R.L., where the tax forgone
amounted to ITL 46 249 000, or about EUR 24 000,
and CRN — Costruzioni Meccaniche Riparazioni Navali
Srl,
to
ITL 53 708 000, or about EUR 27 000). Neither of the
two firms supplied any information that would be rele-
vant to the assessment of the compatibility of the relief
with Community law; Clemna has since been placed in
compulsory liquidation. By letter of 6 December 1999
the Italian authorities informed the Commission that the
Ministry of Finance would be able to recover the unpaid
tax. Subsequently, by letter of 8 May 2000,
they
informed the Commission that the Ministry had initiated
the procedure for the recovery of the tax.

amounted

forgone

II. DETAILED DESCRIPTION OF THE AID

The Law provided for investment aid in the form of tax
exemptions on reinvested profits. The scheme applied to
all firms in Objective 1, 2 or 5(b) areas and to microen-
terprises outside such areas. Microenterprises were
defined as firms which, in the tax period following that
in progress on 12 June 1994, had generated a turnover
of less than ITL 5 billion and which had a workforce of
not more than 20.

Under the Law, 50 % of reinvested profits were exempt
from tax. Eligibility for this relief was restricted to profits
intended for the financing of investment carried out in
1996 that exceeded the average amount of investment
carried out in the previous five years. Eligible investment
was investment in new plant, investment for the exten-
sion and modernisation of an existing establishment,
and investment in the purchase of new capital goods,
including
acquired through leasing
contracts.

capital

goods

III. COMMENTS SUBMITTED BY ITALY

collected from firms in the industries referred to in the
Commission decision initiating the procedure.

(11)

(12)

(13)

IV. ASSESSMENT OF THE AID

The measures in question constitute aid to firms since
they have the effect of selectively reducing, for the reci-
pients, the costs normally borne by competing firms.
Furthermore, only certain firms qualify for these reduc-
tions, more specifically firms located in Objective 1, 2 or
5(b) areas, microenterprises as defined in the Law, and
small and medium-sized enterprises.

The aid, granted in the form of tax relief, consequently
distorts competition between firms and is liable to affect
intra-Community trade.

The firms concerned were subject to the special State aid
rules laid down in Council Directive 90/684/EEC on aid
to shipbuilding (5), as last amended by Directive 94/
73/EC (6). The validity of the Directive was extended by
Council Regulation (EC) No 3094/95 (7) and by Council
Regulation (EC) No 1904/96 (8). Article 11(2)(b) of the
Directive stipulates that Member States must notify the
Commission in advance of any decision to apply a
general or regional aid scheme to the firms covered by
the directive, and must not put such a decision into
effect before it is authorised. The Commission notice of
6 March 1996 on the de minimis rule for State aid (9)
does not apply to shipbuilding.

(14)

The aid granted to Italy in 1996 in the form of tax relief
was not notified to the Commission or authorised by it,
and was consequently illegal, as the Commission found
in Article 3 of Decision 1999/148/EC, ECSC.

(15) As for compatibility with the common market,

the
Italian authorities have not supplied any information
which would allow it to be concluded that the measures
are compatible with Directive 90/684/EC. They have
taken steps to recover the money.

V. CONCLUSIONS

(16)

The Commission accordingly concludes that
the aid
granted by Italy in 1996 in the form of tax relief under
Law No 549/95 to the shipbuilders Clemna Soc. Coop. a
R.L. and CRN — Costruzioni Meccaniche Riparazioni
Navali Srl
in that it was not notified to the
Commission or authorised by it before it was granted. It
is also incompatible with the common market, as it does
not qualify for any of the exemptions provided for in
Directive 90/684/EEC,

is illegal

(10)

The Italian authorities have not contested either the
form or the substance of the Commission Decision.
They have taken the necessary measures to arrive at a
solution in keeping with the Community rules (see
recital 6), and have taken steps to recover the tax not

(5) OJ L 380, 31.12.1990, p. 27.
(6) OJ L 351, 31.12.1994, p. 10.
(7) OJ L 332, 30.12.1995, p. 1.
(8) OJ L 251, 3.10.1996, p. 5.
(9) OJ C 68, 6.3.1996, p. 9.

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HAS ADOPTED THIS DECISION:

Article 1

The State aid granted by Italy in the form of tax relief to
Clemna Soc. Coop. a R.L. and CRN — Costruzioni Meccaniche
Riparazioni Navali
and
ITL 53 708 000 respectively,
incompatible with the
common market.

totalling
is

ITL 46 249 000

Srl,

the Commission to calculate the net grant equivalent of
regional aid schemes.

Article 3

Italy shall inform the Commission, within two months of the
notification of this Decision, of the measures taken to comply
herewith.

Article 2

Article 4

1.
Italy shall take the measures necessary to recover from
the recipients the aid illegally granted to them which is referred
to in Article 1.

Recovery shall be effected without delay in accordance
2.
with the procedures established under Italian law, provided that
they allow the immediate and effective execution of
this
Decision. Interest shall be charged on the amount of the aid
from the date on which it was granted until the date it is
reimbursed. The interest rate applicable shall be that used by

This Decision is addressed to the Italian Republic.

Done at Brussels, 12 July 2000.

For the Commission

Pedro SOLBES MIRA

Member of the Commission