2002/468/EC: Commission Decision of 15 January 2002 on the State aid implemented by Germany for Klausner Nordic Timber GmbH & Co. KG, Wismar, Mecklenburg-Western Pomerania (Text with EEA relevance) (notified under document number C(2002) 13)
Date: 2002-01-15
Institutions: European Commission
Subjects: Germany, State aid, business start-up, common market, investment aid, observation, redemption, small and medium-sized enterprises

24.6.2002

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Official Journal of the European Communities

L 165/15

COMMISSION DECISION

of 15 January 2002

on the State aid implemented by Germany for Klausner Nordic Timber GmbH & Co. KG, Wismar,
Mecklenburg-Western Pomerania

(notified under document number C(2002) 13)

(Only the German text is authentic)

(Text with EEA relevance)

(2002/468/EC)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

(2)

Having regard to the Treaty establishing the European Com-
munity, and in particular the first subparagraph of Article 88(1)
thereof,

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

Having called on interested parties to submit their comments
pursuant to the provisions cited above (1) and having regard to
their comments,

(3)

Whereas:

1. PROCEDURE

(1)

Following a series of complaints concerning State aid
granted to Klausner Nordic Timber GmbH & Co. KG
(hereinafter ‘KNT’), Germany was asked by the Com-
mission in 1999 and 2000 to provide all relevant
information that would enable it to examine whether
the aid was compatible with the common market. The
measures concerned State aid granted to KNT for the
construction and expansion of a sawmill in Wismar
(Mecklenburg-Western Pomerania). The information
provided by Germany was deemed to be incomplete and
did not allay the Commission’s concerns as to whether
the measures were compatible with previously approved
aid schemes.

(1) OJ C 219, 4.8.2001, p. 3.

By letter of 17 August 2000, Germany was required by
the Commission in accordance with Article 10(3) of
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) and with the judgment of
the Court of Justice of the European Communities of
5 October 1994 in Case 47/91 Italy v Commission (3) to
present all the information necessary to assess whether
the measures in favour of KNT were covered by aid
schemes which had previously been approved by the
Commission.

By letter of 13 November 2000, the annexes to which
were received by separate post on 16 November,
Germany provided the information necessary to assess
whether the aid recipient was to be regarded as an SME
within the meaning of the Community guidelines on
State aid for small and medium-sized enterprises (4)
(‘Community guidelines’) and commission recommen-
dation 96/280/EC of 3 April 1996 concerning the
definition of small and medium-sized enterprises (5) and,
therefore, as being eligible for aid in the assisted areas
where the two projects are located, with a maximum
gross aid intensity of 50 %.

(4)

The Commission informed Germany by letter of 20 June
2001 of its decision to initiate the procedure under
Article 88(2) of the EC Treaty and to require the
provision
accordance with
Article 10(3) of Council Regulation (EC) No 659/1999.

information

of

in

(2) OJ L 83, 27.3.1999, p. 1.
(3) [1994] ECR I-4635.
(4) OJ C 213, 23.7.1996, p. 4.
(5) OJ L 107, 30.4.1996, p. 4.

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Official Journal of the European Communities

24.6.2002

(5)

(6)

(7)

(8)

Germany reacted to the decision initiating the procedure
and the information injunction by letter of 2 August
2001, the annexes to which were received on 12 No-
vember.

(11) The shareholders of KHI-GmbH are:

(a)

Fritz Klausner (25 %);

The decision initiating the procedure was published in
the Official Journal of the European Communities (6). At the
same time, the Commission called on all
interested
parties to submit their comments.

The Commission received comments from a number of
interested parties. The comments were forwarded to
Germany, which gave its observations by letter of
31 October 2001.

2. DESCRIPTION OF THE AID

2.1. The aid recipient

The legal person to which the aid was granted, KNT, was
formed on 28 May 1997 and constructed a new sawmill
in Wismar, Mecklenburg-Western Pomerania in 1998.
KNT processes coniferous timber. The business is con-
ducted by the general partner (7) Klausner Nordic Timber
GmbH (‘KNT-GmbH’). The shares in the limited partner-
ship KNT are owned by Fritz Klausner, a natural person,
who also owns all the capital of KNT; he is the sole
limited partner (8) of KNT.

(b) Margarethe Klausner

(Fritz Klausner’s mother)

(50 %);

(c) Anne Klausner (Fritz Klausner’s sister) (25 %).

(12) The partners of KHI are:

(a) KHI-GmbH (general partner; no capital interest);

(b)

Fritz Klausner (limited partner; capital interest of
75 %; no voting rights since 1 January 1997);

(c) Margarethe Klausner (limited partner; capital inter-

est of 25 %).

(13) Klausner Holz Thüringen Geschäftsführung GmbH
(‘KHT-GmbH’) is a German limited liability company
which manages the business of Klausner Holz Thüringen
GmbH & Co. KG (‘KHT’). KHT operates a sawmill in
Friesau (Thuringia). Fritz Klausner owns all the shares in
KHT-GmbH; he managed the company until 19 June
1997.

(14) The partners of KHT are:

(a) KHT-GmbH (general partner; no capital interest;

managing director);

(b)

Fritz Klausner (limited partner; capital interest of
20 %);

(9)

Fritz Klausner also holds shares in other companies:

(c) KHI (limited partner; capital interest of 80 %).

(10) Klausner Holzindustrie GmbH (‘KHI-GmbH’) is an Aus-
trian limited liability company responsible for the man-
agement of Klausner Holzindustrie GmbH & Co. KG
(‘KHI’), which operates a sawmill in St Johan (Tyrol).
KHI-GmbH is the general partner of KHI.

(6) See footnote 1.
(7) The general partner is liable with all its assets for the liabilities of
a limited partnership and has the right to manage and represent
the partnership.

(8) The limited partner is liable only to the extent of his or her
limited-partner contribution. The limited partner has no authority
to manage or represent the partnership. However, the limited
partner’s approval is required for the general partner to conduct
transactions going beyond the ordinary course of business.

(15) KHT Hobelwerk Beteiligungsgesellschaft mbH (‘KHO-
GmbH’), which is wholly owned by Fritz Klausner, was
formed on 15 May 1997. It is the general partner of
KHT Hobelwerk GmbH & Co. KG (‘KHO’), which
operates a planing mill in Thuringia.

(16) Klausner Nordic Services GmbH (‘KNS’), which is wholly
owned by Fritz Klausner, is a service company for local
enterprises.

(17) Klausner Nordic Energie GmbH (‘KNE’), which is wholly
owned by Fritz Klausner, operates a power plant.

(18) The companies with which Fritz Klausner was involved

from 1996 to 1999 are the following:

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Official Journal of the European Communities

L 165/17

Name

Share of Fritz Klausner

Employees

Turnover
in million EUR

Balance sheet total
in million EUR

1996

1997

1996

1997

1996

1997

1996

1997

KNT

not

rel-

evant (9)

100 %

not relevant

KNT GmbH

not relevant

100 %

not relevant

6

1

not relevant

[...] (*)

not relevant

[...]

not relevant

0

not relevant

0,03

KHT

20 %

20 %

159

167

KHT GmbH

100 %

100 %

KHO

100 %

100 %

1

0

1

2

[...]

0

[...]

[...]

0

[...]

[...]

[...]

0,028 (10)

0,03

[...]

[...]

KHT Hobelwerk Beteiligungs
GmbH

not relevant not relevant not relevant not relevant not relevant not relevant not relevant not relevant

KHI

75 %

75 %

KHI GmbH

25 %

25 %

4,5

1

3

0

[...]

0

[...]

0

[...]

0,131

[...]

0,1

Name

Share of Fritz Klausner

Employees

Turnover
in million EUR

Balance sheet total
in million EUR

1998

1999

1998

1999

1998

1999

1998

1999

KNT

100 %

100 %

153

211

KNT GmbH

100 %

100 %

1

0

KHT

20 %

20 %

171 (173)

206

KHT GmbH

100 %

100 %

KHO

100 %

100 %

KHT Hobelwerk Beteiligungs
GmbH

100 %

100 %

KHI

75 %

75 %

KHI GmbH

25 %

25 %

1

19

1

1

0

KNS

KNE

not relevant

100 %

not relevant

not relevant

100 %

not relevant

0

26

0

1

0

50

7,66

[...]

0

[...]

0

[...]

0

[...]

0

[...]

0

[...]

0

[...]

0

[...]

0

[...]

0,02

[...]

0,03

[...]

[...]

0,028

[...]

0,029

[...]

0,02

0,026

[...]

0,1

[...]

0,145

not relevant

1,4

not relevant

0,18

not relevant

0,3

not relevant

0,03

(9) Not relevant. The company was formed at a later date.
(*) Business secret.
(10) The figures in italics were provided by KHT.

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Official Journal of the European Communities

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2.2. The measures

2.2.1. Measure for the construction of a new production

plant in Wismar (‘first aid package’)

This information was not confirmed by Germany,
however, and the Commission was not presented with
any further evidence. The Commission is therefore
basing its assessment on the decisions of the German
authorities that granted the aid, in so far as the eligible
costs were specified and the aid amount determined and
approved.

(19) The Economics Ministry of Mecklenburg-Western
Pomerania decided on 18 April 1997 (the decision was
modified on 12 March 1998) to grant KNT investment
aid for the construction of a sawmill in Wismar under
the 27th outline plan, approved by the Commission,
for the joint Federal Government/Länder scheme for
improving
(1998-
economic
2002) (11). The sawmill is located in an assisted area
under Article 87(3)(a) of the EC Treaty. The grant
to the ceiling of DEM 43 818 300
was equivalent
(EUR 22,4 million), corresponding to a gross intensity
of 38,21 % of
the eligible investment costs of
DEM 114 669 000 (EUR 58,6 million). According to
Germany, the aid was conditional on the creation of
115 jobs.

structures

regional

(20) By decision of 25 July 1998, which was modified on
26 April 1999, Germany also granted KNT an invest-
ment
for 1997 of DEM 2 635 086
(EUR 1,3 million) under the Investment Allowance Law
1996, an aid scheme approved by the Commission (12).

allowance

(21) By a decision of 1 September 1999, a further investment
allowance was granted on the same basis amounting to
DEM 2 500 000 (EUR 1,3 million), representing 2,18 %
of the eligible investment costs.

(22)

In 1997 Mecklenburg-Western Pomerania also assumed
a guarantee to secure 80 % of a low-interest loan of
DEM 30 million (EUR 15,3 million) under its guarantee
guidelines which had been approved by the Commission
(N 627/1991) (13). The aid element contained in this
measure amounted to 0,5 %, according to the German
authorities, who assumed that KNT ranked as an econ-
omically sound enterprise.

(23) The aid intensity of

the measures mentioned in
recitals 19 to 22 amounted to 43,18 % of the eligible
costs.

(24) The enterprise argued that

it had actually invested
DEM 124 401 024 (EUR 63,6 million) and that, for this
reason, the aid intensity should be lowered to 39,80 %.

(11) Commission letter of 26 January 1999 (SG(99) D/582) N 100/

98; see also OJ C 80, 24.3.1999, p. 3.

(12) Investitionszulagengesetz 1996, N 494/95 (SG (95) D/17154,

27.12.1995).

(13) OJ C 184, 21.7.1992, p. 4.

2.2.2. Measure for the extension of the Wismar mill and

the construction of a second sawmill

(25) On the basis of the 27th outline plan of the joint
Federal Government/Länder scheme (1998 to 2002),
Mecklenburg-Western Pomerania decided on 8 Septem-
ber 1998 to grant KNT further investment aid of
DEM 8 879 000 (EUR 4,5 million) to extend the sawmill
in Wismar. The decision was modified on 22 October
1999. This measure had an aid intensity of 38,34 % of
the eligible costs of DEM 23 161 000 (EUR 11, million).

(26) The following measures were also granted for the project

in 1998:

(a)

(b)

an investment allowance of DEM 2 141 000
(EUR 1,1 million) with an aid intensity of 9,24 %
of the eligible costs;

a low-interest loan from the public-law Reconstruc-
tion Loan Corporation (KFW) amounting to
DEM 11 000 000 (EUR 5,6 million) and with an
aid intensity of 1 %.

(27)

In the decision of 22 October 1999, potential extraordi-
nary depreciation was mentioned with an aid intensity
of 1,42 %. This aid was ultimately not granted because
it related to investments for 1999 and 2000. The
Development Areas Law does not provide
for
depreciation on investments after 31 December 1998.

(28) According to the decision which was modified in 1999,
total aid amounted to 50 % of the eligible costs of
DEM 23 161 000 (EUR 11,8million).

(29) According to other information from Germany, the
Federal Government and the Land of Mecklenburg-
Western Pomerania assumed a joint guarantee in 1999
covering a loan of DEM 29 750 000 (EUR 15,21 million)
under the guarantee programme of the Federal Govern-
ment approved by the Commission for business start-
ups in the new Länder (14) and the guarantee guidelines
of the Land of Mecklenburg-Western Pomerania. Accord-
ing to Germany,
this measure
amounted to 0,5 % it being assumed that KNT ranked as
an economically sound enterprise.

the aid element of

(14) Decision N 287/91, 3.7.1991.

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(30) On 13 April 2000 KNT also sought an investment
allowance in respect of the extension of the sawmill
amounting to DEM 7 880 000 (EUR 4 million). The
decision assumed eligible costs of DEM 39 663 875
(EUR 19,9 million). At the time the procedure was
initiated, it was not clear to which project this measure
applied. Germany did not provide the Commission with
any further information. According to the company, this
investment allowance was granted on the basis of
additional eligible expenses incurred by the company in
connection with the expansion of the sawmill, including
the amount of DEM 2 141 000 previously granted
in 1999. This, however, has not been confirmed by
Germany.

2.3. Grounds for initiating the procedure

(31) Despite the information provided by Germany in
response to the information injunction, the Commission
still had doubts as to whether the newly established
sawmills could be regarded as SMEs and whether the aid
as a whole was covered by approved aid schemes.

(32) The gross aid intensities for the construction and
extension of the sawmill in Wismar are possible in the
case of KNT only if the enterprise is a genuine SME. It
must therefore meet the conditions laid down in the
Community guidelines. One of the conditions in the
decision approving the aid schemes under which public
funds were granted or are still to be granted is com-
pliance with the definition of an SME according to
recommendation 96/280/EC and the Community guide-
lines.

(33)

It had to be ascertained in particular whether the
legal entity KNT, which had been granted various aid
measures, could be viewed as a separate enterprise in its
capacity as aid recipient. The particular question was
whether an ‘economic unit’ within the meaning of
Community legislation (15) had been established or
whether the assisted enterprise also encompassed other
enterprises of the Klausner group. The doubts related in
particular to the relations between KNT and KHT as well
as to the degree of their economic integration. In this
regard, the size of the enterprise to which the aid
was granted had first to be determined before the
Commission could assess whether the aid recipient met
the definition of an SME.

(34) With the still incomplete information from Germany on
the enterprises belonging to the Klausner group, the
Commission was unable to make a determination on
the SME status of the aid recipient and thus on the
question of whether the aid granted to KNT is covered
by regional aid schemes previously approved by the

(15) See Court of Justice in its judgment of 14 November 1984 in

Case 323/82 Intermills v Commission [1984] ECR 3808.

Commission or is to be viewed as new aid. However, the
Commission also had doubts regarding the compatibility
of all the measures with the common market.

(35) Accordingly, the Commission decided to initiate the
procedure under Article 88(2) of the EC Treaty and to
issue an information injunction under Article 10(3) of
Regulation (EC) No 659/1999.

3. COMMENTS FROM INTERESTED PARTIES

(36) After initiating the procedure, the Commission received

comments from eight interested parties.

(37) Two competitors of the Klausner sawmills complained
about not gaining access to the profit and loss statement
and balance sheet of the Klausner group, which were
not published. Taking the figures specified by the
enterprise for raw materials consumption, the turnover
and balance-sheet total for 1996 had to have exceeded
the SME thresholds, according to the competitors.
Moreover, neither KNT nor KHT made an equity contri-
bution towards the financing of the two projects. Given
its scale, the project did not comply with the SME
provisions from the outset. The large amount of aid
conferred major advantages on KNT in relation to its
competitors, most of whom had a turnover of less than
EUR 1,5 million and an equity ratio of below 15 %.
Since the start of operations in Wismar, large volumes
of timber were sold at a price which would not be
tenable under normal financial conditions and assuming
the same raw material sources. Finally, both sawmill
enterprises were of the opinion that KNT’s argument
that the raw material procurement and product sales by
KNT and KHT occurred on two different markets was
incorrect. They maintained that the raw timber from
Russia and the Baltic region was also used in Austria and
by KHT in Friesau. Moreover, a large part of KNT’s
production was sold in central and southern Germany
as well as in Austria and Italy, where the Austrian timber
industry is likewise very active.

(38) Both the Swedish Timber Association and the Associ-
ation of the Swedish Forestry Industry sent in their
the procedure had been initiated.
comments after
According to them,
the investment aid and credit
guarantees for KNT signified that, in addition to the
related particle board and laminated wood plants in
Wismar, one of Europe’s largest sawmills had been
constructed. No capacity shortage justifying such invest-
ments had been recorded in any of
these market
segments, however. Sawn timber is to be viewed as a
highly mature product not in heavy demand; a strong
need for consolidation exists in the industry. Substantial
demand for product development also exists in various
market segments given the increase in the use of
timber. According to the ECE Timber Committee, the
production and consumption of sawn timber were as
follows in Europe between 1991 and 2000:

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Official Journal of the European Communities

24.6.2002

Production

Consumption

Surplus/deficit

(in millions of m3)

1991

2000

66,5

96,1

72,5

91,7

- 6,0

+ 4,4

As the following figures illustrate, production increased
in northern Europe in the 1990s:

Production

1991

2000

(in millions of m3)

Sweden

Finland

Baltic States

Germany

11,2

14,8

6,4

13,3

?

5,3

11,6

17,4

(39) The Swedish associations emphasised that the subsidised
formation of KNT and others has contributed to the
increase in overproduction which the European industry
has been seeking intensively to bring under control for
many years. This overproduction had led to declining
prices for sawn timber and increasing raw material costs.
The Commission notes that, according to the KHT
website, the production capacity of the Wismar plant
was 1,3 million m3.

(40) Regarding the SME status of the enterprise, the Swedish
industry was unable to comment on the question of
whether KNT could be classified as a ‘small or medium-
sized enterprise’
in the various phases in which the
State aid was granted. According to information in its
possession, however, the plant in Wismar is 50 % larger
than the largest Swedish sawmill built in the last three
years. In conclusion, the associations pointed out that
KNT was one of Europe’s largest sawmills and, together
with the corporate group to which it belongs, exerted a
substantial influence on the market in which it is active.

(41) A German law firm reacted to the decision to initiate the
procedure with the statement that KHT and KNT were
active as a single enterprise on the market. Its letter
stated that the SME criteria had not been met at the time
the aid was granted, although the law firm has not
explained this in any detail to date. Moreover, the law
firm stated that the aid intensity of the guarantee was
over 0,50 % since KNT and KHT were unable to finance
the doubling of the Wismar mill’s capacity. The letter
stated in conclusion that the State aid was granted to

KNT to support economic development in the new
Länder without any consideration for the provisions of
Community law.

(42) The Austrian Chamber of the Timber Industry expressed
its regret that the balance sheet of KNT and KHT had
not been made available for public inspection. In its
opinion, the aid was granted without the necessary
equity bases.
the Klausner group
procured its raw materials from areas in which the
Austrian industry traditionally made its raw timber
purchases. Klausner production was able to compete
with production from Austrian sawmills only as a result
of low prices that did not reflect market conditions.

It confirmed that

(43) The Association of the German Sawmill and Timber
Industry pointed out to the Commission that KNT and
KHT were described as production facilities on their
websites. Even under the hypothetical assumption that
the family owners of all ‘Klausner companies’ and the
overlapping, only partially non-voting shares of Fritz
Klausner
in KHT, held via Klausner Holzindustrie
GmbH & Co. KG (St Johan, Austria), did not enjoy or
offer the possibility of exerting control, KHT-GmbH,
which Fritz Klausner owns, is responsible for the man-
agement of KHT.

(44) KNT likewise responded via its legal representatives to
the decision to initiate the procedure. The previously
missing information on the number of employees and
the financial data of various group companies were
supplemented and the aid intensity of the two projects
was recalculated. With regard to the construction of the
sawmill in Wismar, KNT distinguished between the total
aid intensity calculated (as envisaged in the aid notice)
on the basis of the investment expenditure (43,18 %)
and the intensity calculated on the basis of the actual
investments (39,80 %). For the extension project, the
total aid intensity amounted to 49,82 % and the ‘de
facto aid intensity’ to 30,08 %. KNT also provided more
detailed information on the investment allowance for the
investments made in 1999, putting the total investment
expenditure
at
DEM 37 891 390 (EUR 19,4 million). The aid intensity
was also recalculated for the extension project on the
basis of the actual total investment expenditure, resulting
in a figure of 44,67 %. Finally,
the aggregate aid
intensity was calculated for the investment totalling
DEM 62 032 981 (EUR 31,7 million) in 1999 and 2000,
resulting in a figure of 31,13 %.

extension

project

the

for

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(45) KNT also commented on its integration with other
companies of the Klausner group. In its view, KNT must
be considered as being independent of KHT, given that
Fritz Klausner does not exercise joint control over KNT
and KHT. KNT refers to Article 1(3) of the Annex to
Recommendation 96/280/EC, whereby companies that
are to be considered independent are those which are
not owned as to 25 % or more of the capital or the
voting rights by one enterprise, or jointly by several
enterprises, falling outside the definition of an SME.
According to KNT, the word ‘joint’ implies joint exercise
of control, which is why the enterprises with one or more
holdings must pursue a common interest. Although Fritz
Klausner, according to KNT, holds shares in KNT and
KHT, he has no possibility in corporate law to make
decisions regarding the business operations of KHT.

(46) KNT furthermore argued that there are no joint econ-
omic interests and no economic integration of KNT and
KHT. The concepts of the two enterprises are different,
being based on different geographical and logistical
features and different raw material and sales market
conditions. For example, the mill in Wismar is located
in an international Baltic Sea port and imports Nordic
timber for the production of high-grade sawn timber.
The production from Wismar is exported owing to the
existence of the economically advantageous sea route.
In contrast, given its geographical location, the mill in
It
Thuringia has less favourable marketing options.
processes mainly German timber and distributes its
lower-grade production to a neighbouring area because
of high transport costs. Therefore, there is no close
cooperation between the two enterprises, which do not
pursue any common economic interest. KNT and KHT
do not, it is argued, have joint management or joint
departments for administrative tasks. They also have
different suppliers and buyers. Apart from certain prod-
uct groups, the two enterprises did not compete with
each other.

(47) KNT further stated that the independence of KNT and
KHT is evident from the current websites of the two
enterprises. The link between the websites of KNT and
KHT was made to establish a timber cluster via which
independent timber processors and suppliers were to be
presented. Other companies were to be added, but the
project failed. No other link existed between KNT and
KHT. Finally, the fact that KHT appears in the aid
applications as a contact person for KNT is because
Fritz Klausner was the manager of KHT until mid-1997.
Today the enterprises have nothing whatsoever in
common administratively.

4. COMMENTS FROM GERMANY

(48) By letter of 2 August 2001, Germany commented on
the decision to initiate the procedure. Firstly, it turned
to the credit guarantee of DEM 29,75 million assumed by
the Federal Government and the Land of Mecklenburg-
Western Pomerania by virtue of the decision of 6 April
1999. According to Germany, this guarantee served to
finance the second saw line and was subject to the
condition that the investment cost increase for the first
saw line be secured through an obligation on the part of
the lending banks before the credits could be disbursed.
The guarantee was a condition for the realisation of the
investments and the related positive effects for the
region. By letter of 11 November 1998, the Commission
agreed that an aid intensity of 0,5 % should be set with
respect to guarantees for sound enterprises. The legality
and compatibility of the guarantee derived from the
Commission decision approving the Federal Govern-
ment’s guarantee programme.

(49) Germany replied as follows to the Commission’s ques-
tions set out in the information injunction. The Com-
mission had requested copies of all the resolutions
adopted at the general meetings of KHT and KNT
partners since their formation. Germany informed the
Commission that no written documents on the KHT
partner resolutions existed. Regarding KNT, Germany
presented a resolution of 7 April 1999 concerning a
capital increase and a resolution of 28 December 2000
on the acceptance of a general partner in KNT GmbH &
Co. KG. It also presented a copy of the agreements
between KNT or KHT and three of their respective
suppliers. These were not always the largest suppliers.
No agreement existed between KNT and KHT, on the
one hand, and the suppliers, on the other, because KNT
and KHT were independent companies. Germany also
provided a list of all persons with management duties
within KHT and KNT.

(50) Germany likewise discussed the comments of interested
parties. Concerning access to the annual reports of
KNT and KHT, it pointed out that no legal reporting
requirement exists for limited partnerships with limited
liability companies as general partners (GmbH & Co. KG)
in accordance with Section 264a of the German Com-
mercial Code. Concerning the equity share in the project
financing, it stated that KNT’s equity capital amounted
to DEM 17 million. Finally,
it pointed out that the
projects in Wismar met the conditions of the joint
Federal Government/Länder scheme for regional econ-
omic development, under which it
is necessary to
strengthen the infrastructure and competitiveness of the
region via investment. KNT was also having to contend
with the difficulties stemming from mounting compe-
tition on the timber market.

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(51) With respect to the annual reports, the Commission
notes that,
in fact, no reporting requirement existed
under German law until 31 December 1999. Germany
provided it with the financial data of
the various
companies in the Klausner group, particularly the annual
financial statements for KNT, KNT GmbH, KHT, KHT
GmbH, KHO, KHO GmbH, KHI and KHI GmbH. Regard-
ing the equity contribution, the Commission notes that
such an obligation first existed in Germany as of
1 January 2000.

5. ASSESSMENT

(52) On the basis of the information provided by Germany,
the Commission distinguished between two aid packages
for KNT, one for the construction of the sawmill in
Wismar and the other for its extension.

(53) The aid granted to KNT in 1997 to 1998 for the
construction of a sawmill in Wismar with a total gross
aid intensity of 43,2 % was allegedly granted under
regional aid schemes previously approved by the Com-
mission (16).

(54) Regarding the aid granted in the period 1998 to 2000
for the extension of the sawmill in Wismar, it is evident
from the documents of the German authorities provided
to the Commission that the total amount of aid corre-
sponded to an aid intensity of 50 %. In addition to these
measures, a guarantee was granted in 1999 with an aid
investment
intensity of 0,5 %, as was an additional
allowance totalling DEM 7 880 000 (EUR 4,0 million).

(55)

Pursuant to Article 87(1) of the EC Treaty, any aid
granted by a Member State or through State resources in
any form whatsoever which distorts competition or
threatens to distort competition by favouring certain
undertakings or the production of certain goods is
incompatible with the common market in so far as it
affects trade between Member States. The aid for KNT
was granted through State resources.
It distorts or
threatens to distort competition because it was granted
to an individual undertaking in a branch of production
and thus conferred on it an advantage over its competi-
tors. The trade between Member States is affected
because the branch in which KNT is active covers several
Member States. Germany has not disputed the aid-like
character of the measures.

(56) The Commission notes

the measures were
under
areas
implemented
Article 87(3)(a) of the EC Treaty. It also notes that the
maximum admissible gross aid intensity in these regions

that
structurally weak

in

(16) 27th outline plan of

the joint Federal Government/Länder
the Investment Allowance Law and the guarantee

scheme,
guidelines of the Land of Mecklenburg-Western Pomerania.

was 35 % and 50 % for large enterprises and SMEs
respectively on the basis of the relevant schemes and
regional aid map of Germany applicable at the time the
aid was granted (17). These rates represent ceilings which
apply to the total aid granted if, for example, aid is
granted under various regional schemes or from local,
regional, national or Community resources.

In light of the total aid intensity of the first aid package,
the aid granted to KNT for the construction of the
sawmill required that the aid recipient ranked as an SME
within the meaning of the Community guidelines and
the Commission recommendation.

Even after deciding to institute the formal procedure and
to issue an information injunction, the Commission is
still not sure what the total aid for the extension of the
sawmill in Wismar was. However, the total aid intensity
of the second aid package obviously exceeds 35 %. This
means that the aid recipient must meet the criteria of
the SME definition contained in recommendation 96/
280/EC and in the schemes applicable at the time the
programme was approved.

5.1. The SME status of the aid recipient

5.1.1. Definition of an SME

‘Small and medium-sized enterprises’ are enterprises
which have fewer than 250 employees and an annual
turnover not exceeding ECU 40 million or an annual
balance-sheet total not exceeding ECU 27 million and
which conform to the criterion of independence (18).

‘Independent enterprises’ are enterprises which are not
owned as to 25 % or more of the capital or the voting
rights by one enterprise, or jointly by several enterprises,
falling outside the definition of an SME or a small
enterprise.

In this connection, the Commission recalls its position
on SMEs, which consists in providing this category of
enterprises with special incentives and removing certain
handicaps. Point 1.2 of the guidelines explains that one
of the main such handicaps is the difficulty in obtaining
capital and credit as well as access to information,
particularly information concerning new technologies
and potential markets, and the higher costs entailed by
new regulatory arrangements.

(57)

(58)

(59)

(60)

(61)

(17) Aid N 613/96, approved by Commission decision of 18 Decem-

ber 1998.

(18) In accordance with the definition of an SME given in the Annex

to recommendation 96/280/EC.

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(62) The bonus (i.e. the increase in the admissible amount of
aid) for SMEs is therefore justified not only by the
contribution which these enterprises make to the com-
mon good but also, in light of their positive role, by the
necessary compensation for the handicaps they face. It
must be ensured, however, that the bonus is, in fact,
granted only to enterprises which have to contend with
these handicaps. In particular, the definition of an SME
must be so restrictive that only those enterprises which
have the envisaged positive effect on third parties and
are disadvantaged by the abovementioned handicaps are
covered. The definition cannot, therefore, be extended
to many larger companies which do not necessarily have
a positive effect on third parties or which do not
absolutely have to reckon with the handicaps typically
faced by SMEs. Aid granted to such companies could
lead to further distortions of competition and intra-
Community trade.

(63) This principle is stated in the recital 22 to Recommen-
dation 96/280/EC, which reads as follows:
‘Whereas,
therefore, fairly strict criteria must be laid down for
defining SMEs if
them are
genuinely to benefit
the enterprises for which size
represents a handicap’.

the measures aimed at

The Commission takes particular care to ensure that the
independence criterion is not circumvented. In order to
guarantee that only genuine SMEs benefit from a scheme,
legal constructs of SMEs which constitute economic
groupings with greater market power than that of an
SME must be excluded.

5.1.2.

Size of the relevant enterprise

(64) Article 87(1) of the EC Treaty relies on the definition of
an undertaking when defining an aid recipient. As the
Justice confirmed in Case 323/82 (19), an
Court of
undertaking need not constitute a separate legal entity
but may consist of a group of companies. For purposes
of implementing Community law, undertakings must
be equated with ‘economic units’. Consequently, it is
necessary to distinguish between various factors, such as
companies’ shareholding patterns, the persons of the
shareholders/partners and the degree of economic inte-
gration.

(65) The legal person benefiting from the two aid packages is
KNT. When initiating the procedure, the Commission
stated that there were indications that KNT was not to
be regarded as the relevant enterprise. Various elements
suggested that the aid recipient was possibly larger than

(19) See footnote 16.

the legal person KNT and might encompass other
companies related to Fritz Klausner.

(66) Of the enterprises in which Fritz Klausner is present,
three companies operate sawmills, namely KHI, KNT
and KHT. The sawmill operations of KHI were discon-
tinued in 1996, however. It must be investigated whether
KNT itself constitutes a ‘single economic unit’ or whether
the two other sawmills KNT and KHT can be regarded
as companies which together form a single economic
unit.

(67)

(68)

I n t e r m s o f o w n e r s h i p r e l a t i o n s

Fritz Klausner possesses the entire capital of KNT and is
also the sole shareholder in KNT-GmbH, the general
partner of KNT. He therefore decides both on the normal
and the extraordinary business transactions of KNT.

Fritz Klausner owns all the shares in KHT-GmbH, the
general partner of KHT. He also owns 20 % of the capital
of KHT. The other limited partner of KHT is KHI. Fritz
Klausner owns 75 % of the capital of KHI, although he
has not been entitled to vote at general meetings of
partners since 1 January 1997. According to Germany,
the management authority at KHT-GmbH has been
restricted so that KHT-GmbH must now muster three
quarters of the voting rights of KHT’s partners. Fritz
Klausner cannot therefore decide alone on the normal
and extraordinary business transactions of KHT but
requires
the approval of his mother, Margarethe
Klausner.

(69) The Commission notes, however, that all persons with
shares in KHT-GmbH, KHT, KHI-GmbH and KHI belong
to the same family.

(70)

Further elements mentioned by the Commission when
it instituted the procedure point to the fact that KNT
and KHT have coordinated their activity.

I n t e r m s o f e c o n o m i c i n t e g r a t i o n

(71) When initiating the procedure, the Commission present-
ed the arguments deployed by Germany to prove
that KNT and KHT should be considered as different
economic units.

(72) According to Germany, KNT and KHT have different
business concepts based on their geographical and
logistical features. The two companies do not pursue the
same interests and do not work together.

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(73) The KNT sawmill is located in Wismar, a Baltic Sea port
of international importance. KNT processes high-quality
timber from the best regions in northern Europe. It
obtains this high-quality timber with its small knots
primarily from Scandinavia, Russia and the Baltic States.
It exports its production by sea to the Netherlands,
Belgium, France, the United Kingdom, Denmark, North
Africa and Japan.

(74) The KHT sawmill

is located in Friesau in the low
mountain region of eastern Germany. KHT obtains its
raw material from within a radius of 200 km, processing
mainly German timber. This timber is of low quality
and, because of high transport costs (rail and road), the
mill’s markets are limited to Germany, Italy and the
USA.

(75)

In addition, according to Germany, the two companies
have their own management and personnel departments.

(76) When it

instituted the procedure,

specified several elements which suggested that
activities of KNT and KHT are coordinated.

the Commission
the

(77) At the time the procedure was initiated, there was a link
on the KNT website (20) to that of KHT; the names of
both companies appeared under the heading ‘Plant
locations’. They were described as being located in
central Europe, from where they supplied customers all
over the world. Both companies were described as
enterprises producing high-quality wood whose cus-
tomers came from the wood-processing industry.

(78)

For the rest, in contrast to Germany’s statements, the
two companies appeared to share certain management
activities. According to the presentation on the websites,
they had a joint sales manager, Anne Leibold, and a
joint manager responsible for purchasing, Matthias
Wittkemper. For such major business activities as
material procurement and marketing, KNT and KHT
therefore had the same manager and so appeared to the
outside world as a single enterprise.

(79)

Finally, KHT represented KNT in certain administrative
tasks. The decisions of the Land of Mecklenburg-Western
Pomerania concerning the granting of investment aid
the sawmill were
to KNT for the construction of
communicated to KNT ‘for the attention of’ KHT.

(80) Germany did not comment specifically on any of these
points. It merely presented a list of KNT and KHT
managers which showed that the companies did not
have joint management.
It also provided the Com-
mission with the agreements of KNT and KHT with three

(20) http://www.knt.de/, 21.5.2001; http://www.kht.de/, 21.5.2001.

of their suppliers. Germany did not comment, however,
on the specific items raised in recitals 76 to 79.

(81)

For its part, KNT reacted to these specific points, as
summarised in recitals 44 to 47. It stated that the two
companies pursued different economic interests and did
not share any management tasks.

(82) However, the Commission is still of the opinion that
sufficient elements indicate some coordination of activi-
ties by KNT and KHT. After the procedure had been
initiated, the websites of the companies were reorgan-
ised. KNT argues that the link which existed at the time
was set up in connection with the formation of a timber
cluster via which various independent producers and
suppliers from the timber industry would be able to
present their business activities. Following the failure of
the project,
the link between KNT and KHT was
removed. Despite the information injunction, no proof
was presented in support of
these arguments. The
Commission considers that the statements made by
KNT contradict the fact that the two companies were
presented together to the outside world. It also finds that
on both KNT’s and KHT’s website the two companies
were described as the two plant locations. Both were
moreover described as companies which supplied their
customers with high-quality sawn timber in Europe
and worldwide. The comments by interested parties
confirmed that both KNT and KHT are present in central
Europe, in the Nordic countries and on all markets on
which Nordic and Austrian sawmill enterprises are
active. KNT and KHT obviously do not have any clearly
separate procurement and supplier markets. Even if such
a division existed, the fact that each operating facility is
specialised in its own segment does not imply that the
operating facilities do not belong to the same economic
unit.

(83) Regarding the management positions in the two com-
panies, their websites were changed so that the names
of Anne Leibold and Matthias Wittkemper now appear
only on the KHT management list. They were removed
from the KNT management list on the companies’
websites. Anne Leibold as sales manager and Matthias
Wittkemper as purchasing manager do not appear on
the overview of KNT management personnel which was
presented by Germany for the period from 1 January
1998 to 31 December 1999, but only on that of KHT.
Despite the information injunction, this change was not
justified to the Commission, which doubts that these
changes can be sufficiently justified. It cannot therefore
conclude that KNT and KHT do not carry out joint
management tasks.

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L 165/25

(84)

It is evident from the comments by interested parties
that KNT and KHT are perceived as one and the same
enterprise and as one of the market’s largest participants.

(85)

For the above reasons, the Commission has concluded
that the legal person KNT cannot alone be regarded as
the information
the aid recipient. On the basis of
available to it, it considers that the relevant enterprise is
larger and also encompasses KHT. KHT and KNT are
actually linked to each other through one of their
partners. They pursue the same economic activity;
purchasing and marketing are carried out by the same
managers; and the two enterprises appear on their
respective websites under the heading ‘Plant locations’.

5.2. Compatibility of the total amount of aid for the
construction of the sawmill in Wismar

(86) When the procedure was initiated, the Commission had
already come to the conclusion that
there was no
reason to institute formal proceedings in respect of the
investment grant of DEM 43 818 000 (EUR 22,4
million), the investment allowance of DEM 2 635 086
(EUR 1,3 million) and the guarantee with an aid
intensity of 0,5 % that had been made available for
the construction of the mill in Wismar because they
constituted aid that had been granted previously.

of

the

allowance

investment

(87) However, the Commission had doubts regarding the
of
conformity
DEM 2 500 000 (EUR 1,3 million). This measure
involved aid in the form of a tax benefit which is granted
automatically if objective legal conditions (i.e. the realis-
ation of the investment) are met. The State does not
have any discretion when granting this tax benefit; the
decision of the tax authorities does not create a subjective
right but merely constitutes an act to determine whether
the conditions for a claim exist. Therefore, the moment
an investment is realised is to be regarded as the date on
which the benefit is granted. In the present case, 1998 is
to be considered the year in which this measure was
granted since it was granted for investments realised in
that year.

(88) Recommendation 96/280/EC stipulates: ‘Where, at the
final balance-sheet date, an enterprise exceeds or falls
below the employee thresholds or financial ceilings, this
is to result in its acquiring or losing the status of “SME”,
“medium-sized enterprise”, “small enterprise” or “micro-
enterprise” only if the phenomenon is repeated over two
consecutive financial years’.

balance-sheet
total of EUR [...] (*) and turnover of
EUR [...], exceeding the thresholds for the definition of
an SME. The year 1997 was the first time this happened,
as the SME thresholds were not exceeded in 1996, when
the aid recipient had 159 employees and a balance-sheet
total of EUR [...].

(90) Accordingly, the aid recipient retained SME status in
1998. It was therefore still an SME in 1998, when the
aid was granted. The investment allowance granted in
1998 is thus covered by an approved aid scheme and is
to be regarded as existing aid.

5.3. Compatibility of the total amount of aid for the
extension of the sawmill

(91) When the procedure was initiated, the Commission had
there was no
already come to the conclusion that
reason to initiate formal proceedings in respect of the
investment aid of DEM 8 879 000 (EUR 4,5 million) for
the extension of the project because it constituted aid
that had been granted previously. The procedure was
thus initiated in respect of the other measures involved
in the extension project.

(92) The

allowance

investment

of DEM 2 141 000
(EUR 1 094 675) with an aid intensity of 9,24 % is
considered as having been granted in 1998 since the
related investment was realised in 1998. The low-interest
loan of DEM 11 000 000 (EUR 5 624 210) with an aid
intensity of 1 % was previously specified in the original
1998 decision and is thus to be considered as having
been granted in 1998.

(93) Consequently, the aid recipient was in 1998 still an SME
in respect of the aid granted in 1998, which is why these
measures are covered by approved aid schemes. The
Commission therefore came to the conclusion that the
matter involves existing aid.

(94) Germany provided more detailed information on the
guarantee to secure the loan of DEM 29 750 000
(EUR 15,21 million) with an aid intensity of 0,5 %. It
confirmed that the guarantee was intended to finance
the extension of the sawmill but failed to explain how
the loan of DEM 29 750 000 (EUR 15,21 million)
was linked to the eligible costs of DEM 23 161 000
(EUR 11,8 million) and whether it was to be included
with the measures previously granted. The admissibility
of the measures, according to Germany, can be derived
from the Commission decision approving the guarantee
programme of the Federal Government (21).

(89) The reference year to be considered is 1997 since this is
the period covered by the annual balance sheet available
at the time the aid was granted. Although the aid
recipient had 167 employees in 1997, it achieved a

(*) Business secret.
(21) See footnote 15.

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24.6.2002

(95)

Since Germany failed to explain matters, the Com-
mission has determined that the aid constituted 0,5 % of
the eligible costs of DEM 23 161 000 (EUR 11,8 million)
and therefore amounted to DEM 115 805 (EUR 59 210)
pursuant to the provisions of the relevant programme.

market, and its effects on regional development are
likely to be too limited. However, ad hoc aid can none
the less meet the conditions for compatibility, provided
that it does not exceed the regional aid ceiling approved
by the Commission.

(96) The Commission notes, however, that the total aid
intensity of the measures granted for the extension
project amounted to 49,08 % if the measures in the
present case are to be included with those previously
granted for the same project. The German regional aid
map applicable at the time the aid was granted, as
approved by the Commission (22), stipulates for invest-
ments in Mecklenburg-Western Pomerania a maximum
aid intensity of 35 % in the case of large enterprises and
50 % in the case of SMEs.

(97) The guarantee was granted in 1999. Taken together, in
the financial year 1998 KNT and KHT exceeded all the
ceilings stipulated in the definition of an SME. Taking
the data mentioned in recital 89 for the financial year
1997, the financial ratios of the aid recipient in the two
financial years preceding the grant (1998 and 1997)
exceeded the ceilings stipulated in the definition of an
SME. Accordingly, the aid recipient lost its SME status in
1999. The total aid intensity of the measures granted for
the extension project exceeded the 35 % ceiling on
regional aid for large enterprises. The cumulation rule
was not complied with. The measure is not therefore
covered by an approved aid scheme and is to be regarded
as new ad hoc aid. Because the aid was granted without
the Commission’s approval,
it is to be regarded as
unlawful aid.

(98) The aid was granted for an investment in Mecklenburg-
Western Pomerania. This region is an assisted area under
Article 87(3)(a) of the EC Treaty. In accordance with
Section 2 of the guidelines on national regional aid (23)
(‘the regional guidelines’),
these guidelines apply to
regional aid granted in every sector of the economy,
except those to which special schemes are applicable. As
the production of sawn timber is not covered by any
special arrangements, the relevant aid is assessed in the
light of the regional guidelines.

(99)

In accordance with the regional guidelines, a derogation
from the incompatibility principle established by
Article 87(1) of the EC Treaty may be granted in respect
of regional aid only if the equilibrium between the
resulting distortions of competition and the advantages
of the aid in terms of the development of a less-favoured
region can be guaranteed. The regional guidelines go on
to state that an ad hoc payment made to a single firm
may have a major impact on competition in the relevant

(100) For the reasons given above, the aid recipient is not an
SME under the Community guidelines and Commission
Regulation (EC) No 70/2001 of 21 January 2001
concerning the application of Articles 87 and 88 of the
EC Treaty to State aid to small and medium-sized
enterprises (24). The aid of DEM 115 805 (EUR 59 210)
was granted in excess of the regional aid ceiling under
the German regional aid map for large enterprises in the
Land of Mecklenburg-Western Pomerania. The gross aid
ceiling of 35 % approved by the Commission was
determined in the light of the type and severity of the
relevant regional problems. The granting of an additional
aid element for an investment in this region cannot
therefore be justified by virtue of a regional problem.

(101) Germany did not specify any other reason for the
compatibility of the aid which might have existed in the
present case. The derogations in Article 87(2) of the EC
Treaty are not applicable here, given that the aid does
not have a social character and is not granted to
individual consumers, does not serve to make good the
damage caused by natural disasters or other exceptional
occurrences and is not granted to the economy of certain
areas of the Federal Republic of Germany affected by the
division of Germany. The derogation in Article 87(3)(b)
of the EC Treaty is not applicable because the project
obviously does not represent an important project of
derogation in
common European interest. The
Article 87(3)(c) of the EC Treaty (in so far as the
development of certain economic activities is concerned)
is likewise not applicable because the aid is not intended
to facilitate the development of certain economic activi-
ties. This provision further requires that the aid should
‘not adversely affect trading conditions to an extent
contrary to the common interest’. The Commission is of
the opinion that this condition has not been met. The
main effect of the aid in question is, in fact, to promote
the competitiveness of the beneficiaries in a production
branch where there is strong international competition.
The derogation in Article 87(3)(d) of the EC Treaty is
likewise not applicable because the aid clearly does not
serve to promote culture and heritage conservation.

(22) See footnote 18.
(23) OJ C 74, 10.3.1998, p. 9.

(24) OJ L 10, 13.1.2001, p. 33.

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(102) Accordingly, the Commission came to the conclusion
that the guarantee does not meet the conditions necess-
ary for it to be considered as compatible with the
common market.

allowance

(103) On the basis of eligible costs of DEM 39 663 875
(EUR 20 279 817), KNT received for 1999 an additional
investment
7 880 000
(EUR 4 028 980), giving an aid intensity of 19,8 %.
Germany failed to explain how this measure related to
the extension project, even though the Commission had
noted the absence of this information when it initiated
the procedure and issued the information injunction.

DEM

of

(104) In its comments after the procedure was initiated, KNT
provided explanations for the various measures from
which it had benefited. For 1999 it thus applied for an
investment allowance of DEM 7 880 312 (EUR 4,3 milli-
on) on the basis of investments of DEM 39 663 874
(EUR 20,3 million) and ultimately received an amount
of DEM 7 775 095 (EUR 3,9 million). According to
KNT, the sum of DEM 2 141 000 (EUR 1,1 million) is
included in the latter amount.

(105) There is no confirmation from Germany or any evidence
in the form of an official document to support this
the unclear relationship
statement. On account of
between the individual measures and the varying bases
of calculation, the Commission was unable to relate this
measure to the measures previously mentioned and to
the costs declared to be eligible for aid. It therefore
assessed this measure separately.

(106) The investment allowance was allegedly granted under
an approved aid scheme, namely the Investment Tax
Allowance Law 1999. Under this scheme, a maximum
aid intensity of 10 % is specified for aid recipients with
more than 250 employees. Given that the aid recipient
had more than 250 employees in 1999, when the
investment was carried out, the scheme covered the
measure only for up to 10 % of the eligible costs of
DEM 39 663 875
i.e.
(EUR
DEM 3 966 387 (EUR 2,0 million). The Commission
lacks information on the project for which the aid was
granted. Classification as ad hoc regional aid or some
other type of aid, which would justify one of the
derogations mentioned in recital 101, is not therefore
possible. In any case, the measure cannot, for the same
reasons, be regarded as being compatible with the
common market. The Commission therefore came to
the conclusion that the part of the aid in excess of
DEM 3 966 387 (EUR 2,0 million) does not meet the
criteria and cannot
therefore be regarded as being
compatible with the common market.

20,3 million),

6. CONCLUSION

(107) The Commission has concluded that Germany unlaw-
fully granted the guarantee which corresponds to aid of
DEM 115 805 (EUR 59 210) and the portion of the
investment which was granted to Klausner Nordic
Timber GmbH & Co. KG in 1998 and exceeded the
amount of DEM 3 966 387 (EUR 2 027 982) in breach
of Article 88(3) of the EC Treaty. In view of the above
considerations, it also notes that the relevant aid does
not meet the criteria for compatibility with the common
market and that the aid must be recovered from the aid
recipient,

HAS ADOPTED THIS DECISION:

Article 1

The following State aid which Germany has implemented for
Klausner Nordic Timber GmbH & Co. KG is incompatible with
the common market:

(a)

a guarantee to secure a loan of DEM 29 750 000
(EUR 15,21 million) with an aid element of 0,5 %;

(b)

a portion of the investment allowance for 1999 exceeding
the amount of DEM 3 966 387 (EUR 2 027 982).

Article 2

1.
Germany shall take all measures necessary to recover
from the beneficiary the aid referred to in Article 1 and
unlawfully made available to the beneficiary.

2.
Recovery shall be effected without delay and in accord-
ance with the procedures of national law, provided that they
allow the immediate and effective execution of the decision.
The aid to be recovered shall include interest from the date on
which it was at the disposal of the beneficiary until the date of
its recovery. Interest shall be calculated on the basis of the
reference rate used for calculating the grant equivalent of
regional aid.

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Article 3

Article 4

This Decision is addressed to the Federal Republic of Germany.

Done at Brussels, 15 January 2002.

Germany shall inform the Commission within two months of
notification of this Decision of the measures taken to comply
with it.

For the Commission

Mario MONTI

Member of the Commission