Communication from the Commission — Multisectoral framework on regional aid for large investment projects (notified under document No C(2002) 315) (Text with EEA relevance)
Date: 2002-03-19
Institutions: European Commission
Subjects: EU control, aid system, investment aid, regional aid

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Official Journal of the European Communities

19.3.2002

COMMUNICATION FROM THE COMMISSION

Multisectoral framework on regional aid for large investment projects

(notified under document No C(2002) 315)

(2002/C 70/04)

(Text with EEA relevance)

1. INTRODUCTION: SCOPE OF THE MEASURE

1. On 16 December 1997,

framework on regional

the Commission adopted the
large
(cid:145)Multisectoral
investment projects(cid:146) (1). The multisectoral
framework
became applicable from 1 September 1998 for an initial
trial period of three years.
Its validity was extended in
2001 until 31 December 2002.

aid for

2. In accordance with point 4.1 of

the multisectoral
framework, the Commission conducted a review in 2001
and concluded that it had to be revised. It also considered
that the specific sectoral frameworks should be integrated
into the new multisectoral framework.

3. This framework only applies to regional aid, as defined by
the (cid:145)Guidelines on national regional aid(cid:146) (2), that aims to
promote initial investment, including job creation linked to
initial investment, on the basis of Article 87(3)(a) and (c) of
the Treaty. This framework is without prejudice to the
assessment of aid proposals under other provisions of
the Treaty such as Article 87(3)(b) or (d). For the steel
and synthetic fibres sectors, it also applies to large indi-
vidual aid grants for small and medium-sized undertakings
that are not exempted by Commission Regulation (EC) No
70/2001 (3). This framework does not apply to restruc-
turing aid cases, which will continue to be covered by
the Community guidelines on State aid for rescuing and
this
restructuring
framework will not affect the operation of the existing
Community
horizontal
such
framework for State aid for research and development (5)
and the Community guidelines on State aid for environ-
mental protection (6).

difficulty (4).

frameworks,

Similarly,

firms

the

as

in

4. This framework does not affect

the
specific State aid rules that apply to the agriculture,
fisheries and transport sectors and to the coal industry.

the operation of

5. The aid intensity of regional

investment aid that is not
exempted from the notification obligation laid down in
Article 88(3) of the EC Treaty by an exemption regulation
adopted by the Commission on the basis of Council Regu-

(1) OJ C 107, 7.4.1998, p. 7.
(2) OJ C 74, 10.3.1998, p. 9.
(3) OJ L 10, 13.1.2001, p. 33.
(4) OJ C 288, 9.10.1999, p. 2.
(5) OJ C 45, 17.2.1996, p. 5.
(6) OJ C 37, 3.2.2001, p. 3.

lation (EC) No 994/98 (7) will be limited on the basis of
the criteria laid down in this framework.

6. Under this framework no advance notification of aid below
certain thresholds for large investment projects is required,
provided that aid is granted in accordance with an aid
scheme approved by the Commission. However,
this
framework does not affect the Member States’ obligation
to notify new individual (ad-hoc) aid that is not exempted
from the notification obligation laid down in Article 88(3)
of the EC Treaty by an exemption regulation adopted by
the Commission on the basis of Regulation (EC) No
994/98. The rules laid down in this framework apply
also to the assessment of such individual
(ad-hoc) State
aid measures.

2. THE NEED FOR THE MEASURE

2.1. The reasons
instrument

to have a simple and transparent

7. Compared to the previous multisectoral framework, this
instrument. The Commission
framework is a simpler
investment aid to large projects
considers that regional
should be controlled in a simple and transparent way.
On the basis of experience with the previous multisectoral
framework,
introduced several
simplifications, changes and clarifications.

the Commission has

8. Firstly, the previous multisectoral framework did not have
a significant impact on State aid levels for large investment
projects in the Community. The Commission considers it
necessary to have a restrictive approach with regard to
aid granted to large-scale projects, whilst
regional
preserving the attraction of
the less favoured regions.
The need for a more restrictive approach on regional aid
to large-scale mobile investment projects has been widely
acknowledged in recent years. The completion of the single
market makes it more important than ever to maintain
tight controls on State aid for such projects, since the
distortive effect of aid is magnified as other government-
induced distortions of competition are eliminated and
markets become more open and integrated. An appro-
priate balance between the three core objectives of
Community policy, namely undistorted competition in
the internal market, economic and social cohesion, and
industrial competitiveness, must
therefore entail stricter
rules for regional aid granted to large-scale projects.

(7) OJ L 142, 14.5.1998, p. 1.

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9. Secondly, the incorporation of several frameworks into a
unified instrument will have the effect of simplifying the
existing legislation and increasing the accountability and
transparency of State aid control.

10. Third, the utilisation of a much simpler instrument will
reduce the administrative burden within the adminis-
trations and will enhance the predictability of decisions
of allowable aid amounts for investors and administrations
alike.

11. And fourth,

in order to prevent serious distortions of
competition, the framework provides for stricter rules for
sectors suffering from structural problems.

2.2. The need for a more systematic control on regional

aid to large-scale mobile investment projects

15. Additionally, companies making large investments usually
possess a considerable bargaining power vis-(cid:224)-vis the auth-
investors in large projects
orities granting aid.
in different Member
often consider
sites
alternative
increasingly
States, which may lead to a spiral of
generous promises of aid, possibly to a level much
higher than what
is necessary to compensate for the
regional handicaps.

Indeed,

16. The outcome of such subsidy auctions is likely to be that
large investments receive aid intensities that exceed the
additional costs resulting from the choice of locating the
investment in a disadvantaged area.

17. The amount of aid exceeding the minimum necessary to
compensate for the regional disadvantages is a very likely
location choices),
cause of perverse effects (inefficient
higher distortion of competition and,
since aid is a
costly transfer from taxpayers in favour of aid recipients,
net welfare losses.

12. The maximum aid ceilings fixed by the Commission for all
areas eligible for regional aid are in general designed to
provide an appropriate level of incentive necessary for the
the assisted regions. However, as they
development of
provide a single ceiling, they are usually in excess of the
regional handicaps when applied to large-scale projects.
The purpose of this framework is to limit the level of
that
incentive available for
avoids as much as possible unnecessary distortions of
competition.

large projects

to a level

13. Large investments can effectively contribute to regional
development, amongst other things by attracting other
companies to the region and introducing advanced tech-
nologies as well as by contributing to the training of
workers. However, these investments are less affected by
important region-specific problems in disadvantaged areas.
First of all,
large investments can produce economies of
scale that reduce location-specific initial costs. Secondly,
tied to the region in
they are in many respects not
which the physical
Large
investment
investments can easily obtain capital and credit on global
markets and are not constrained by the more limited offer
of financial services in a particular disadvantaged region.
Moreover, companies making large investments can access
a geographically wider pool of labour, and can more easily
transfer a skilled workforce to the chosen location.

takes place.

14. At

if

the same time,

large investments

there is an increased risk that

receive large
amounts of State aid by benefiting from the full regional
ceilings,
trade will be
affected and thus of a stronger distortion effect vis-(cid:224)-vis
competitors in other Member States. This is because the
beneficiary of the aid is more likely to be a significant
player on the market concerned and, consequently, the
investment for which the aid is awarded may modify the
conditions of competition in that market.

18. Recent

large

shown that

experience has

investment
projects benefiting from regional
investment aid are
more capital-intensive than smaller investment projects.
As a consequence, a more favourable treatment of
smaller
into a more
favourable treatment in assisted areas of projects that are
more labour intensive, thus contributing to job creation
and unemployment reduction.

investment projects

translates

19. Certain types of

share, or where

investment are likely to cause serious
distortion of competition, and their beneficial effect on
the region concerned is doubtful. This is true in particular
for investments in sectors where a single company has a
existing sectoral
high market
significantly, without a
production capacity increases
corresponding increase
the products
concerned. More generally, distortion of competition is
likely in sectors
suffering from structural problems,
where the existing production capacity already exceeds
the product, or where the
the market demand for
demand for
concerned is persistently
declining.

in demand for

the products

the

to this

taken pursuant

20. In line with Article 159 of the EC Treaty, due account
must be taken of the coherence between the State aid
decisions
framework and the
actions of the structural funds leading to a strengthening
of the economic and social cohesion of the Community, in
particular those aimed at reducing disparities between the
levels of development of the various regions, and the back-
wardness
Projects
least-favoured
co-financed from the structural funds effectively contribute
to economic and social cohesion within the Community
and should therefore be duly taken into consideration.

regions.

the

of

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3. REDUCTION OF AID LEVELS FOR LARGE INVESTMENT

PROJECTS

21. Without prejudice to the compatibility criteria laid down
in the guidelines on national regional aid and in Regu-
lation (EC) No 70/2001, and without prejudice to the
notification obligation laid down in point 24 or to the
transitional
regional
investment aid concerning investments involving eligible
expenditure (8) for the thresholds set out below shall be
subject to an adjusted lower regional aid ceiling, on the
basis of the following scale:

laid down in section 8,

rules

Eligible expenditure

Adjusted aid ceiling

Up to EUR 50 million

100 % of regional ceiling

For the part between EUR 50
million and EUR 100 million

50 % of regional ceiling

For the part exceeding
EUR 100 million

34 % of regional ceiling

22. Thus,

the allowable aid amount

for a project above
EUR 50 million will be calculated according to the
formula: maximum aid
= R (cid:215) (50 + 0,50
B + 0,34 C); where R is the unadjusted regional ceiling;
B is the eligible expenditure between EUR 50 million
and EUR 100 million; and C is the eligible expenditure
above EUR 100 million, if any (9).

amount

(8) Under the guidelines on national regional aid, the eligible expen-
diture for regional investment aid is defined either by the rules laid
down in its points 4.5 and 4.6 (option 1) or by the rules laid down
in its point 4.13 (option 2). In line with point 4.19 of the guidelines
on national regional aid, aid calculated on the basis of option 1
((cid:145)investment aid(cid:146)) can be combined with aid calculated on the basis
of option 2 ((cid:145)job creation aid(cid:146)) provided the combined amount of
aid does not exceed the regional aid ceiling multiplied by the higher
of the two possible eligible expenditures. In line with this rule, and
for the purposes of the present framework, the eligible expenditure
of a specific investment project is defined on the basis of the option
that leads to the higher amount. The eligible expenditure amount
will be determined in such a way as not to exceed the higher
investment amount resulting from the higher of the job creation
method and the initial investment method, subject to the intensity
ceiling laid down for the region.
(9) The table below further illustrates,

for specific sizes of eligible
expenditure and for specific regional ceilings, the aid intensities
that could be allowed under the reduction scale.

Eligible
expenditure

EUR 50
million

EUR 100
million

EUR 200
million

EUR 500
million

Regional aid ceiling

15 %

20 %

25 %

30 %

35 %

40 %

15,00 % 20,00 % 25,00 % 30,00 % 35,00 % 40,00 %

11,25 % 15,00 % 18,75 % 22,50 % 26,25 % 30,00 %

8,18 % 10,90 % 13,63 % 16,35 % 19,08 % 21,80 %

6,33 % 8,44 % 10,55 % 12,66 % 14,77 % 16,88 %

23. By way of example, for a large company investing EUR 80
million in an assisted area where the unadjusted regional
aid ceiling is 25 % net grant equivalent
the
maximum allowable aid amount would be EUR 16,25
million nge, which corresponds to an aid intensity of
20,3 % nge. For a large company investing EUR 160
million in the same area,
the maximum allowable aid
amount would be EUR 23,85 million nge, which
corresponds to an aid intensity of 14,9 % nge.

(nge),

24. However, Member States are required to notify every case
of regional investment aid if the aid proposed is more than
the maximum allowable aid that an investment of
EUR 100 million can obtain under the scale and the
rules laid down in paragraph 21 (10). Individually notifiable
projects will not be eligible for investment aid in either of
the following two situations:

(a) the aid beneficiary accounts for more than 25 % of the
sales of the product concerned before the investment
or will, after the investment, account for more than
25 %; or

(b) the capacity created by the project is more than 5 % of
the size of
the market measured using apparent
consumption data of the product concerned, unless
its apparent
the average annual growth rate of
five years is above the
consumption over the last
average
European
the
rate
annual
Economic Areas’s GDP.

growth

of

The burden of proving that the situations to which points
(a) and (b) refer do not obtain lies with the Member
State (11). For the purpose of applying points (a) and (b)
apparent consumption will be defined at the appropriate
level of the Prodcom classification (12) in the EEA, or, if
such information is not available, on the basis of any other
market segmentation generally accepted for the products
concerned and for which statistical data are readily
available.

(10) Proposals to award ad-hoc aid must in any event be notified and
will be assessed on the basis of the rules laid down in section 3 of
the Framework, and in line with the general assessment criteria laid
down in the guidelines on national regional aid.

(11) If the Member State demonstrates that the aid beneficiary creates,
through genuine innovation, a new product market, the tests laid
down in letters (a) and (b) do not need to be carried out, and the
aid will be authorised under the scale in paragraph 21.

(12) Council Regulation (EEC) No 3924/91 of 19 December 1991 on
the establishment of a Community survey of industrial production
(OJ L 374, 31.12.1991, p. 1).

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the project

25. The maximum allowable aid intensity that a notifiable
project can receive under point 24 may be increased by
multiplying it by the factor 1,15 if
is
co-financed from structural
funds resources as a major
project within the meaning of Article 25 of Council Regu-
lation (EC) No 1260/1999 of 21 June 1999 laying down
general provisions on the structural funds (13), in line with
the provisions laid down in Article 26 of the same Regu-
lation. The rate of co-financing must be at least 10 % of
the total public expenditure, if the project is located in an
area eligible for aid under Article 87(3)(c) of the Treaty and
at least 25 % of the total public expenditure if the project
is located in an area eligible for aid under Article 87(3)(a)
thereof.

26. However, the aid increase resulting from point 25 must
not lead to an aid intensity higher than the maximum aid
intensity allowed for an investment of EUR 100 million,
i.e. 75 % of the unadjusted regional aid ceiling.

4. AN AID PROHIBITION FOR INVESTMENT PROJECTS IN

THE STEEL INDUSTRY

its

structure,

the location of

its highly capital

27. As regards the steel industry as defined in Annex B to this
framework (14), the Commission notes that for a fairly long
period of time, ECSC steel companies functioned without
recourse to investment aid such as had been available to
the rest of the industrial sectors. Steel companies have
integrated this factor in their strategies and are used to
it. Given the specific features of
the steel sector (in
the existing over-capacity at
particular
European and world level,
intensive
the majority of steel plants in
nature,
regions eligible for regional aid, the substantial amounts
of public funds devoted to the restructuring of the steel
sector, and the conversion of
the steel areas) and the
experience gained when less strict rules on State aid
it appears justified to continue to
applied in the past,
prohibit investment aid to this sector, irrespective of the
the Commission
size of
considers that regional aid to the steel
industry is not
compatible with the common market. This incompatibility
also applies to large individual aid grants made to small
and medium-sized enterprises within the meaning of
Article 6 of Regulation (EC) No 70/2001, which are not
exempted by the same Regulation.

the investment. Accordingly,

5. INVESTMENT PROJECTS IN SECTORS WITH STRUCTURAL

PROBLEMS OTHER THAN STEEL

28. The Commission has consistently considered in the past
that investment in sectors that do, or might, suffer from

(13) OJ L 161, 26.6.1999, p. 1.
(14) It includes the steel sectors currently covered by the ECSC Treaty as
well as the sub-sectors of seamless tubes and large welded tubes,
currently not covered by the ECSC Treaty, but which form part of
an integrated production process and which have similar features
to the steel sector covered by the ECSC Treaty.

serious overcapacity or persistent decline in demand
increase the risk of distortion of competition, without
bringing the necessary counterbalancing benefits to the
region concerned. The proper way to recognise that
from a regional
these investments are less beneficial
point of view is to reduce investment aid to projects in
sectors where structural problems prevail, to a level below
that permitted for other sectors.

29. Until now, several sensitive industrial sectors have been
subject
In
accordance with point 1.3 of the previous multisectoral
framework, these specific sectoral rules continued to apply.

rules on State aid (15).

to specific,

stricter

30. One of

the objectives of

the previous multisectoral
framework was to provide for the possibility of replacing
the existing sectoral rules with a single instrument. Subject
to the transitional rules laid down in section 8 below, the
Commission wishes
revision to
include
sectors within this
framework.

through the present

industrial

sensitive

these

31. By 31 December 2003, sectors where serious structural
problems prevail will be specified in a list of sectors
investment aid
annexed to the framework. No regional
will be authorised in these
to the
subject
provisions laid down in this section.

sectors,

32. For the purpose of drawing up the list of sectors, serious
structural problems will in principle be measured on the
basis of apparent consumption data, at the appropriate
level of the CPA classification (16) in the EEA, or, if such
information is not available, on the basis of any other
market segmentation generally accepted for the products
concerned and for which statistical data are readily
available. Serious structural problems will be deemed to
exist when the sector concerned is declining (17). The list of
sectors shall be updated periodically, with a frequency to
be determined at the time at which the list of sectors is
decided.

(15) Code on aid to the synthetic fibres industry (OJ C 94, 30.3.1996,
p. 11) and Community framework on State aid to the motor
vehicle industry (OJ C 279, 15.9.1997, p. 1); aid to shipbuilding
is covered by Council Regulation (EC) No 1540/98 of 29 June
1998 establishing new rules on aid to shipbuilding (OJ L 202,
18.7.1998, p. 1).

(16) Council Regulation (EEC) No 3696/93 of 29 October 1993 on the
statistical classification of products by activity (CPA)
in the
European Economic Community (OJ L 342, 31.12.1993, p. 1),
as last amended by Commission Regulation (EC) No 204/2002
(OJ L 36, 6.2.2002, p. 1).

(17) A strong presumption of sectoral decline can arise from a negative
average annual growth rate of apparent consumption in the EEA
over the last five years.

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be

individually

33. As from 1 January 2004, and for sectors included in the
list of sectors with serious structural problems, all regional
investment aid concerning an investment project involving
eligible expenditure above an amount to be determined by
the Commission at the time of drawing up the list of
sectors (18) must
the
Commission, without prejudice to the provisions laid
down in Regulation (EC) No 70/2001. The Commission
will examine such notifications in accordance with the
following rules: firstly, the aid project must comply with
the general assessment criteria laid down in the guidelines
on national regional aid; secondly, the eligible expenditure
as defined under point 50 exceeding an amount to be
determined by the Commission at the time of drawing
up the list of sectors will not be eligible for investment
aid, except for the cases referred to in point 34.

notified

to

34. By way of derogation from point 33, the Commission may
authorise investment aid for sectors included in the list of
sectors on the basis of the aid intensities laid down in
section 3 of this framework, provided that the Member
State demonstrates that, although the sector is deemed to
be in decline, the market for the product concerned is fast
growing (19).

6. EX-POST MONITORING

35. In drawing up this

framework,

attempted to ensure that, as far as possible,
unambiguous, predictable and efficient and that
additional administrative burden it entails is kept
minimum.

the Commission has
it is clear,
the
to a

36. In order to ensure transparency and effective monitoring,
it is appropriate to establish a standard format in which
should provide the Commission with
Member States
summary information in the form laid down in Annex
A, whenever aid for investments above EUR 50 million
is granted in pursuance of this framework. On implemen-
tation of aid falling under this framework, Member States
must, within 20 working days starting from the granting
of the aid by the competent authority,
forward to the
Commission such summary information. The Commission
will make this information available to the public through
its website (http://europa.eu.int/comm/competition/).

(18) This amount can in principle be set at EUR 25 million but may

vary from sector to sector.

(19) The market for the product concerned will be deemed to be fast
growing if apparent consumption over the last five years at the
appropriate level of the Prodcom classification in the EEA, or, if
such information is not available, on the basis of another market
segmentation generally accepted for the products concerned and
for which statistical data are readily available, is growing in value
terms by an average rate equal to or above the average growth of
the EEA’s GDP.

37. Member States must maintain detailed records regarding
the granting of individual aid falling under this framework.
Such records must contain all
information necessary to
establish that
the maximum aid intensity determined
under this framework is observed. Member States must
keep a record regarding an individual aid for 10 years
from the date on which it was granted. On written
request, the Member State concerned must provide the
Commission, within a period of 20 working days or
such longer period as may be fixed in the request, with
the Commission considers
all
necessary to assess whether
this
the provisions of
framework have been complied with.

information that

the

7. VALIDITY OF THE FRAMEWORK

38. This framework will be applicable for a period ending on
31 December 2009. Before 31 December 2009,
the
Commission will evaluate the framework. The Commission
may amend this framework before 31 December 2009 on
the basis of important competition policy considerations
or in order to take into account other Community policies
or
international commitments. Such review will not,
however, affect the prohibition of investment aid to the
steel industry.

39. As regards the steel sector as defined in Annex B, the
provisions of the framework will be applied as from 24
July 2002. The existing specific sectoral rules for certain
steel sectors not covered by the ECSC Treaty (20) will cease
to be applicable from that date. As regards the motor
vehicle sector as defined in Annex C, and the synthetic
fibres sector as defined in Annex D, the provisions of
the framework will be applied as from 1 January 2003.
However, notifications
registered by the Commission
before 1 January 2003 for the motor vehicle sector and
the synthetic fibres sector will be examined in the light of
the criteria in force at the time of notification.

40. As regards sectors other than those mentioned in point 39,
the provisions of this framework will be applied as from 1
January 2004. The previous multisectoral framework will
remain applicable until 31 December 2003. However,
registered by the Commission before 1
notifications
the
January 2004 will be examined in the light of
criteria in force at the time of notification.

41. The Commission will examine the compatibility with the
its

investment aid granted without

common market of
authorisation:

(a) on the basis of the criteria set out in this framework if

the aid was granted:

(20) OJ C 320, 13.12.1988, p. 3.

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(cid:151) on or after 24 July 2002, as regards investment aid

to the steel sector,

appropriate measures within the meaning of Article 88(1)
of the Treaty. These appropriate measures will include the
following:

(cid:151) on or after 1 January 2003, as regards investment
aid to the motor vehicle sector, and the synthetic
fibres sector,

(a) modifying existing regional aid maps by adapting:

(cid:151) on or after 1 January 2004, as regards investment
aid to all other sectors subject to this framework;

(cid:151) as from 24 July 2002 the current regional aid
ceilings to the aid intensities resulting from the
rules laid down in section 4 of this framework,

(b) on the basis of the criteria in force at the time the aid

was granted, in all other cases.

8. TRANSITIONAL PROVISIONS

42. Until the date of applicability of the list of sectors to which
point 31 refers, and without prejudice to Regulation (EC)
No 70/2001:

(a) the maximum aid intensity for regional investment aid
in the motor vehicle sector as defined in Annex C
granted under an approved scheme in favour of
projects that involve either eligible expenditure above
EUR 50 million or an aid amount above EUR 5
million expressed in gross grant equivalent, will be
equal
the corresponding regional aid
ceiling (21);

to 30 % of

(b) no expenditure incurred in the context of investment
projects in the synthetic fibres sector as defined in
Annex D will be eligible for investment aid.

43. Before the date of applicability of the list of sectors to
the Commission will decide
which point 31 refers,
whether and to what extent the motor vehicle sector as
defined in Annex C and the synthetic fibres sector as
defined in Annex D must be included in the list of sectors.

44. As regards the shipbuilding sector, the existing rules under
Regulation (EC) No 1540/98 will be in force until 31
December 2003. Before this date, the Commission will
have examined whether aid to the shipbuilding sector is
to be covered by this framework and included in the list of
sectors.

9. APPROPRIATE MEASURES

45. In order to ensure the implementation of the rules laid
down in this framework, the Commission will propose

(21) Proposals to award ad-hoc aid must in any event be notified and
will be assessed on the basis of this rule, and in line with the
general assessment criteria laid down in the guidelines on
national regional aid.

(cid:151) as from 1 January 2003 the current regional aid
ceilings to the aid intensities resulting from the
rules laid down in section 8,

(cid:151) as from 1 January 2004 the current regional aid
ceilings to the aid intensities resulting from the
rules laid down in section 3;

(b) adjusting all existing regional aid schemes, as defined
by the guidelines on national regional aid,
including
those exempted from notification pursuant to a block
exemption regulation, in order to make sure that for
regional investment aid granted:

regional

(i) they respect the regional aid ceilings as laid down
in the
as modified in
aid maps,
accordance with (a) above as from 1 January
2004,
than those
mentioned in point 39;

sectors other

regards

as

(ii) they provide for

the individual notification of
regional
investment aid where the aid is more
an
than the maximum allowable
investment of EUR 100 million can obtain under
the scale shown in point 21 of this framework as
from 1 January 2004;

that

aid

(iii) they exclude from their scope aid to the steel

industry as from 24 July 2002;

(iv) they exclude from their scope aid to the synthetic
fibres industry as from 1 January 2003 and until
the list of sectors becomes applicable;

(v) they limit regional

investment aid in the motor
vehicle sector as defined in Annex C in favour of
involve either eligible expenditure
projects that
above EUR 50 million or an aid amount above
EUR 5 million expressed in gross grant equivalent
to 30 % of the corresponding regional aid ceiling,
as from 1 January 2003 and until
the list of
sectors becomes applicable;

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(c) ensuring that the forms mentioned in point 36 are
forwarded to the Commission from the date this
framework becomes applicable;

(d) ensuring that the records mentioned in point 37 are
maintained as from the date this framework becomes
applicable;

(e) complying, until 31 December 2003, with the rules of
the previous multisectoral framework on regional aid
for large investment projects, and in particular with the
notification requirements laid down therein.

product. Where two or more products are produced from
the same raw materials,
the production units of such
products will be deemed to constitute a single production
site.

11.2. Eligible expenditure

50.

(cid:145)Eligible expenditure(cid:146) shall be determined in accordance
with the rules laid down in the guidelines on national
regional aid for this purpose.

for the measures regarding the steel sector,

46. The necessary amendments must be made by the Member
States within a period ending on 31 December 2003,
except
for
which the amendments must be in place from 24 July
2002, and regarding the synthetic fibres sector and the
motor vehicle sector for which the amendments must be
in place as from 1 January 2003. The Member States are
invited to give their explicit agreement to the proposed
appropriate measures within 20 working days from the
date on which the letter
In the
absence of any reply, the Commission will assume that
the Member State in question does not agree with the
proposed measures.

is notified to them.

10. NOTIFICATIONS UNDER THIS FRAMEWORK

47. Member States are invited to use the notification form
attached to this framework (Annex E) for the purpose of
notifying aid proposals pursuant to this framework.

11. DEFINITION OF TERMS USED

48. The following definitions of

the terms used in this

framework will apply:

11.1. Investment project

49.

(cid:145)Investment project(cid:146) means an initial investment within the
meaning of section 4 of the guidelines on national regional
aid. An investment project
should not be artificially
divided into sub-projects in order to escape the provisions
of this framework. For the purpose of this framework an
investment project includes all the fixed investments on a
site, made by one or more undertakings, in a period of
three years. For
framework, a
the purpose of
production site is an economically indivisible series of
items fulfilling a precise technical function,
fixed capital
linked by a physical or functional
link, and which have
clearly identified aims, such as the production of a defined

this

11.3. Regional aid ceiling

51.

large companies

(cid:145)Regional aid ceiling(cid:146) refers to the maximum aid intensity
in the assisted area
authorised for
concerned at
the aid.
Maximum aid intensities are determined in accordance
with the guidelines on national regional aid, on the basis
of the regional aid map approved by the Commission.

the granting of

the time of

11.4. Product concerned

52.

(cid:145)Product concerned(cid:146) means the product envisaged by the
investment project and, where appropriate, its substitutes
considered to be such, either by the consumer (by reason
of the product’s characteristics, prices and intended use) or
by the producer (through flexibility of
the production
installations). When the project concerns an intermediate
product and a significant part of the output is not sold on
the market,
the product concerned will be deemed to
include the downstream products.

11.5. Apparent consumption

53.

(cid:145)Apparent consumption(cid:146) of
production plus imports minus exports.

the product concerned is

54. Where the Commission determines in accordance with this
the apparent
framework the average annual growth of
consumption of the product concerned, it will take into
consideration, where appropriate, any significant change in
that trend.

55. Where the investment project concerns a service sector,
and in order to determine the size and the evolution of
the market, the Commission will, instead of using apparent
consumption, use the turnover of the services concerned
on the basis of the market segmentation generally accepted
for the services concerned and for which statistical data
are readily available.

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ANNEX A

FORM FOR EX-POST MONITORING

(cid:151) Scheme title (or indicate if it is an (cid:145)ad-hoc(cid:146) aid)

(cid:151) Public entity providing the assistance

(cid:151) If the legal basis is an aid scheme approved by the Commission, provide the date of the approval and the State aid

case reference number

(cid:151) Specify the region and the municipality

(cid:151) Specify company name, whether it is an SME or a large company and, where relevant, the name of the parent

companies

(cid:151) Specify the type of the project and whether it is a new establishment or a capacity expansion or other

(cid:151) Specify the total cost and the eligible cost of capital expenditure to be invested over the lifetime of the project

(cid:151) Nominal amount of support and its gross and net grant equivalent

(cid:151) Provide the conditions attached to the payment of the proposed assistance, if any

(cid:151) Products or services concerned and their Prodcom nomenclature or CPA nomenclature for projects in the service

sectors.

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Official Journal of the European Communities

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ANNEX B

DEFINITION OF THE STEEL INDUSTRY FOR THE PURPOSES OF THE MULTISECTORAL FRAMEWORK

The steel
production of the steel products listed below:

industry, for the purposes of the multisectoral framework consists of the undertakings engaged in the

Product

Combined nomenclature code (1)

Pig iron

Ferro-alloys

7201

7202 11 20, 7202 11 80, 7202 99 11

Ferrous products obtained
by direct reduction of iron
ore and other spongy
ferrous products

7203

Iron and non-alloy steel

7206

Semi-finished products of
iron or non-alloy steel

7207 11 11; 7207 11 14; 7207 11 16; 7207 12 10; 7207 19 11; 7207 19 14; 7207 19 16;
7207 19 31; 7207 20 11; 7207 20 15; 7207 20 17; 7207 20 32; 7207 20 51; 7207 20 55;
7207 20 57; 7207 20 71

Flat rolled products of iron
and non-alloy steel

Bars and rods, hot rolled, in
irregularly wound coils, of
iron or non-alloy steel

Other bars and rods or iron
and non-alloy steel

7208 10 00; 7208 25 00; 7208 26 00; 7208 27 00; 7208 36 00; 7208 37; 7208 38;
7208 39; 7208 40; 7208 51; 7208 52; 7208 53; 7208 54; 7208 90 10; 7209 15 00;
7209 16; 7209 17; 7209 18; 7209 25 00; 7209 26; 7209 27; 7209 28; 7209 90 10;
7210 11 10; 7210 12 11; 7210 12 19; 7210 20 10; 7210 30 10; 7210 41 10; 7210 49 10;
7210 50 10; 7210 61 10; 7210 69 10; 7210 70 31; 7210 70 39; 7210 90 31; 7210 90 33;
7210 90 38; 7211 13 00; 7211 14; 7211 19; 7211 23 10; 7211 23 51; 7211 29 20;
7211 90 11; 7212 10 10; 7212 10 91; 7212 20 11; 7212 30 11; 7212 40 10; 7212 40 91;
7212 50 31; 7212 50 51; 7212 60 11; 7212 60 91

7213 10 00; 7213 20 00; 7213 91; 7213 99

7214 20 00; 7214 30 00; 7214 91; 7214 99; 7215 90 10

Angles, shapes and sections
of iron or non-alloy steel

7216 10 00; 7216 21 00; 7216 22 00; 7216 31; 7216 32; 7216 33; 7216 40; 7216 50;
7216 99 10

Stainless steel

7218 10 00; 7218 91 11; 7218 91 19; 7218 99 11; 7218 99 20

Flat-rolled products of
stainless steel

Bars and rods of stainless
steel

Flat rolled products of other
alloy steel

Bars and rods of other
alloys steels

7219 11 00; 7219 12; 7219 13; 7219 14; 7219 21; 7219 22; 7219 23 00; 7219 24 00;
7219 31 00;
7220 11 00;
7220 12 00; 7220 20 10; 7220 90 11; 7220 90 31

7219 90 10;

7219 33;

7219 32;

7219 34;

7219 35;

7221 00; 7222 11; 7222 19; 7222 30 10; 7222 40 10; 7222 40 30

7225 11 00; 7225 19; 7225 20 20; 7225 30 00; 7225 40; 7225 50 00; 7225 91 10;
7225 92 10; 7225 99 10; 7226 11 10; 7226 19 10; 7226 19 30; 7226 20 20; 7226 91;
7226 92 10; 7226 93 20; 7226 94 20; 7226 99 20

7224 90 01;

7224 10 00;
7224 90 31;
7224 90 39; 7227 10 00; 7227 20 00; 7227 90; 7228 10 10; 7228 10 30; 7228 20 11;
7228 20 19;
7228 30 61;
7228 30 69; 7228 30 70; 7228 30 89; 7228 60 10; 7228 70 10; 7228 70 31; 7228 80

7228 30 20;

7228 20 30;

7228 30 49;

7224 90 08;

7224 90 05;

7228 30 41;

7224 90 15;

Sheet piling

7301 10 00

Rails and cross ties

7302 10 31; 7302 10 39; 7302 10 90; 7302 20 00; 7302 40 10; 7302 10 20

Seamless tubes, pipes and
hollow profiles

7303; 7304

Welded iron or steel tubes
and pipes, the external
diameter of which exceeds
406,4 mm

7305

(1) OJ L 279, 23.10.2001, p. 1.

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ANNEX C

DEFINITION OF MOTOR VEHICLE INDUSTRY FOR THE PURPOSES OF THE MULTISECTORAL
FRAMEWORK

The (cid:145)motor vehicle industry(cid:146) means the development, manufacture and assembly of (cid:145)motor vehicles(cid:146), (cid:145)engines(cid:146) for motor
vehicles and (cid:145)modules or sub-systems(cid:146) for such vehicles or engines, either direct by a manufacturer or by a (cid:145)first-tier
component supplier(cid:146) and, in the latter case, only in the context of an (cid:145)overall project(cid:146).

(a) Motor vehicles

The term (cid:145)motor vehicles(cid:146) means passenger cars, vans, trucks, road tractors, buses, coaches and other commercial
vehicles. It does not include racing cars, vehicles intended for off-road use (for example, vehicles designed for use on
snow or for carrying persons on golf courses), motorcycles, trailers, agricultural and forestry tractors, caravans,
special purpose vehicles (for example, firefighting vehicles, mobile workshops), dump trucks, works’ trucks (for
example, forklift trucks, straddle carrier trucks and platform trucks) and military vehicles intended for armies.

(b) Engines for motor vehicles

The term (cid:145)motor vehicle engines(cid:146) means compression and spark ignition engines as well as electric motors and
turbine, gas, hybrid or other engines for motor vehicles.

(c) Modules and sub-systems

A (cid:145)module(cid:146) or a (cid:145)sub-system(cid:146) means a set of primary components intended for a vehicle or engine which is produced,
assembled or fitted by a first-tier component supplier and supplied through a computerised ordering system or on a
just-in-time basis. Logistical supply and storage systems and subcontracted complete operations which form part of
the production chain, such as the painting of sub-assemblies, should likewise be classified among these modules and
sub-systems.

(d) First-tier component suppliers

A (cid:145)first-tier component supplier(cid:146) means a supplier, whether independent or not, supplying a manufacturer, sharing
responsibility for design and development (12), and manufacturing, assembling or supplying a vehicle manufacturer
during the manufacturing or assembly stage with sub-assemblies or modules. As industrial partners, such suppliers
are often linked to a manufacturer by a contract of approximately the same duration as the life of the model (for
example, until the model is restyled). A first-tier component supplier may also supply services, especially logistical
services, such as the management of a supply centre.

(e) Overall project

A manufacturer may, on the actual site of the investment or in one or several
industrial parks in fairly close
geographical proximity (13), integrate one or more projects of first-tier component suppliers for the supply of
modules or sub-systems for the vehicles or engines being produced. An (cid:145)overall project(cid:146) means one which groups
together such projects. An overall project lasts for the life of the vehicle manufacturer’s investment project. An
investment of one first-tier component supplier is integrated within the definition of a global project if at least half
the output resulting from that investment is delivered to the manufacturer concerned at the plant in question.

ANNEX D

DEFINITION OF SYNTHETIC FIBRES INDUSTRY FOR THE PURPOSES OF THE MULTISECTORAL
FRAMEWORK

The synthetic fibres industry is defined, for the purposes of the multisectoral framework, as:

(cid:151) extrusion/texturisation of all generic types of fibre and yarn based on polyester, polyamide, acrylic or polypropylene,

irrespective of their end-uses, or

(cid:151) polymerisation (including polycondensation) where it is integrated with extrusion in terms of the machinery used,

or

(cid:151) any ancillary process linked to the contemporaneous installation of extrusion/texturisation capacity by the pros-
pective beneficiary or by another company in the group to which it belongs and which, in the specific business
activity concerned, is normally integrated with such capacity in terms of the machinery used.

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Official Journal of the European Communities

19.3.2002

ANNEX E

NOTIFICATION FORM (1)

SECTION 1 (cid:151) MEMBER STATE

1.1. Information on notifying public authority:

1.1.1. Name and address of notifying authority.

1.1.2. Name, telephone, fax and e-mail address of, and position held by, the person(s) to be contacted in case of

further inquiry.

1.2. Information of contact in permanent representation:

1.2.1. Name, telephone, fax and e-mail address of, and position held by, the person to be contacted in case of

further inquiry.

SECTION 2 (cid:151) AID RECIPIENT

2.1. Structure of the company or companies investing in the project:

2.1.1. Identity of aid recipient.

2.1.2. If the legal identity of the aid recipient is different from the undertaking(s) that finance(s) the project or that

receive(s) the aid, describe also these differences.

2.1.3. Identify the parent group of the aid recipient, describe the group structure and ownership structure of each

parent company.

2.2. For a company or companies investing in the project, provide the following data for the last three financial years:

2.2.1. Worldwide turnover, EEA turnover, turnover in Member State concerned.

2.2.2. Profit after tax and cash flow (on a consolidated basis).

2.2.3. Employment worldwide, at EEA level and in Member State concerned.

2.2.4. Market breakdown of sales in the Member State concerned, in the rest of the EEA and outside the EEA.

2.2.5. Audited financial statements and annual report for the last three years.

2.3. If the investment takes place in an existing industrial location, provide the following data for the last three financial

years of that entity:

2.3.1. Total turnover.

2.3.2. Profit after tax and cash flow.

2.3.3. Employment.

2.3.4. Market breakdown of sales: in the Member State concerned, in the rest of the EEA and outside the EEA.

(1) For aid granted outside authorised schemes, the Member State must provide information detailing the beneficial effects of the aid on

the assisted area concerned.

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SECTION 3 (cid:151) PROVISION OF PUBLIC ASSISTANCE

For each measure of proposed public assistance, provide the following:

3.1. Details:

3.1.1. Scheme title (or indicate if it is an ad-hoc aid).

3.1.2. Legal basis (law, decree, etc.).

3.1.3. Public entity providing the assistance.

3.1.4. If the legal basis is an aid scheme approved by the Commission, provide the date of the approval and the

State aid case reference number.

3.2. Form of the proposed assistance:

3.2.1. Is the proposed assistance a grant, interest subsidy, reduction in social security contributions, tax credit
(relief), equity participation, debt conversion or write off, soft loan, deferred tax provision, amount covered
by a guarantee scheme, etc.?

3.2.2. Provide the conditions attached to the payment of the proposed assistance.

3.3. Amount of the proposed assistance:

3.3.1. Nominal amount of support and its gross and net grant equivalent.

3.3.2. Is the assistance measure subject to corporate tax (or other direct taxation)? If only partially, to what extent?

3.3.3. Provide a complete schedule of the payment of the proposed assistance. For the package of proposed public

assistance, provide the following:

3.4. The characteristics of the assistance measures:

3.4.1. Are any of the assistance measures of the overall package not yet defined? If yes, specify.

3.4.2. Indicate which of the abovementioned measures does not constitute State aid and for what reason(s).

3.5. Financing from Community sources (EIB, ECSC instruments, Social Fund, Regional Fund, other):

3.5.1. Are some of the abovementioned measures to be co-financed by Community funds? Explain.

3.5.2. Is some additional support for the same project to be requested from any other European or international

financing institutions? If so, for what amounts?

3.6. Cumulation of public assistance measures:

3.6.1. Estimated gross grant equivalent (before taxation) of the combined aid measures.

3.6.2. Estimated net grant equivalent (after taxation) of the combined aid measures.

SECTION 4 (cid:151) ASSISTED PROJECT

4.1. Location of the project:

4.1.1. Specify the region and the municipality as well as the address.

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4.2. Duration of the project:

4.2.1. Specify the start date of the investment project as well as the completion date of the investment.

4.2.2. Specify the planned start date of the new production and the year by which full production may be reached.

4.3. Description of the project:

4.3.1. Specify the type of the project and whether it is a new establishment or a capacity expansion or other.

4.3.2. Provide a short general description of the project.

4.4. Breakdown of the project costs:

4.4.1. Specify the total cost of capital expenditure to be invested and depreciated over the lifetime of the project.

4.4.2. Provide a detailed breakdown of the capital and non-capital (2) expenditure associated with the investment

project.

4.5. Financing of total project costs:

4.5.1. Indicate the financing of the total cost of the investment project.

SECTION 5 (cid:151) PRODUCT AND MARKET CHARACTERISTICS

5.1. Characterisation of product(s) envisaged by the project:

5.1.1. Specify the product(s) that will be produced in the aided facility upon the completion of the investment and
the relevant (sub-)sector(s) to which the product(s) belong(s) (indicate the Prodcom code or CPA nomen-
clature for projects in the service sectors).

5.1.2. What product(s) will it replace? If these replaced products are not produced at the same location, indicate

where they are currently produced.

5.1.3. What other product(s) can be produced with the same new facilities at little or no additional cost?

5.2. Capacity considerations:

5.2.1. Quantify the impact of the project on the aid recipient’s total viable capacity in the EEA (including at group
level) for each of the product(s) concerned (in units per year in the year preceding the start year and on
completion of the project).

5.2.2. Provide an estimate of the total capacity of all EEA producers for each of the products concerned.

5.3. Market data:

5.3.1. Provide for each of the last six financial years data on apparent consumption of the product(s) concerned. If

available, include statistics prepared by other sources to illustrate the answer.

5.3.2. Provide for the next three financial years a forecast of the evolution of apparent consumption of the
product(s) concerned. If available, include statistics prepared by independent sources to illustrate the answer.

5.3.3. Is the relevant market in decline and for what reasons?

5.3.4. An estimate of the market shares (in value) of the aid recipient or of the group to which the aid recipient

belongs in the year preceding the start year and on completion of the project.