2002/784/EC: Commission decision of 24 April 2002 on the State aid implemented by the Federal Republic of Germany for companies on the Wörth Industrial estate (Text with EEA relevance.) (notified under document number C(2002) 1482)
Date: 2002-04-24
Institutions: European Commission
Subjects: Germany, State aid, control of State aid, industrial region, property leasing

19.10.2002

EN

Official Journal of the European Communities

L 282/57

COMMISSION DECISION

of 24 April 2002

on the State aid implemented by the Federal Republic of Germany for companies on the Wörth
Industrial estate

(notified under document number C(2002) 1482)

(Only the German text is authentic)

(Text with EEA relevance)

(2002/784/EC)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

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

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

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

Whereas:

I. PROCEDURE

(1)

(2)

By letter dated 28 September 2000, the Directorate-
General for Competition sought information from Ger-
many on the aforementioned aid measure; Germany
replied on 8 November 2000. The Commission request-
ed additional information on 10 January 2001; Germany
replied on 30 January 2001.

On 25 July 2001 the Commission decided to open
investigation procedure. By letters dated
the formal
16 August and 29 August 2001, Germany submitted
its comments on the opening of the procedure. The
Commission requested further information by letter
dated 25 October 2001; Germany replied on 19 Novem-
ber 2001.

The Commission received comments on the opening of
the procedure from the United Kingdom on 5 November
and 19 December 2001. The comments were forwarded
to the relevant departments in Germany which replied
on 23 November and 28 January 2002. The Commission
requested clarification of a number of matters from the

( 1) OJ C 280, 4.10.2001, p. 2.

United Kingdom by letters dated 20 November 2001
and 16 January 2002. The United Kingdom replied by
letters dated 19 December 2001 and 11 February 2002.

II. DESCRIPTION OF THE BENEFICIARIES AND THE
ALLEGED AID MEASURE

(3)

(4)

The district of Germersheim and the local regional
development agency (Strukturentwicklungsgesellschaft für
das Gebiet des Landkreises Germersheim mbH) have together
set up a land development company (Industriepark
Wörth GmbH - IPW). The object of the company is to
develop a new industrial park on an land adjoining a
DaimlerChrysler production plant.

IPW has invested DEM 6,6 million in the construction
of commercial premises on the land, which are rented
out to three automotive suppliers to DaimlerChrysler
(MAGNA Seating Systems GmbH, Grammer AG, Fritz-
meier Composite). Germany stated that the suppliers
had not requested any investment aid.

(5)

According to Germany, the rental prices on the industrial
estate are DEM 9,00 per m2 for production/storage areas
and DEM 12,00 per m2 for office premises.

III. GROUNDS FOR INITIATING THE INVESTIGATION
PROCEDURE

(6)

The Commission had doubts as to whether the rental
agreements between IPW and the suppliers correspond
to ‘normal market conditions’. The fact that the district
of Germersheim has a majority holding in IPW suggests
that the suppliers were offered preferential conditions
since the public shareholders in IPW naturally have an
interest in attracting companies to the region. Moreover,
it is assumed that the main objective of the IPW project
is to ensure that DaimlerChrysler suppliers move to the
Wörth industrial estate.

(7)

(8)

(9)

L 282/58

EN

Official Journal of the European Communities

19.10.2002

For want of more detailed information, the Commission
could not ascertain either whether the rent paid by the
suppliers corresponds to the rent asked for similar
premises, as the German Government claims. Moreover,
the Commission has not received sufficient evidence to
conclude that IPW’s shareholders make profits as a
result of the project. Therefore, the Commission was
concerned that the project might involve State aid in
the form of preferential rental terms and might be
incompatible with the common market.

IV. COMMENTS FROM GERMANY

V. COMMENTS FROM INTERESTED PARTIES

(12) The United Kingdom submitted on behalf of the North-
ern Ireland Industrial Development Board a statement to
the effect that the rents at Wörth would seem to be very
low compared with those for commercial premises in
Northern Ireland.

(13)

In its reply to the objections by the United Kingdom,
Germany indicated that the figures indicated for North-
ern Ireland might be annual rents, whereas the infor-
mation provided by Germany to the Commission con-
cerned monthly rents.

Germany maintains that the rents on the industrial estate
are in line with normal market rates. To support this
view, it presented several documents.

(14)

Two estate agents confirm that plots on similar industrial
estates have been rented out in the same area at DEM 5
to DEM 7,5 per m2 (EUR 2,56 to EUR 3,83 per m2)
for production/storage premises and at DEM 7,5 to
DEM 9,5 per m2 (EUR 3,83 to EUR 4,86 per m2)
for office premises. A survey by the local economic
promotion agency (Wirtschaftsförderung Südpfalz des Land-
kreises Germersheim) of the conditions on which commer-
cial premises are currently being offered shows that the
rent per m2 for office premises is at most DEM 12
(EUR 6,14) and that for storage premises DEM 10
(EUR 5,11). Adverts in the real estate section of a local
newspaper quote rents of under DEM 5 per m2 (EUR
2,56 per m2) for storage premises and DEM 10 per m2
(EUR 5,11 per m2) for office premises.

(10) A letter to one of the companies that has moved to the
industrial estate (Grammer Wörth GmbH) shows that
the rent at its previous location was DEM 7 per m2
(EUR 3,58/m2), which is lower than the rent it pays on
the industrial estate. DaimlerChrysler AG confirmed that
it rents out plots on its own production site next to
the industrial estate at a price of DEM 8,83 per m2
(EUR 4.51 per m2).

In its letter dated 11 February 2002, the United Kingdom
withdrew its earlier comments as they were based on a
misinterpretation of information. Following the clarifi-
cation, it stated that there was nothing to indicate that
the rents at Wörth distorted competition relative to the
rents for similar premises in Northern Ireland.

VI. ASSESSMENT OF THE MEASURE

(15) The industrial estate is rented out by a land development
company which is owned by the public authorities and
is therefore a public investor. In order to determine
whether the rental conditions for the suppliers contain
elements of State aid within the meaning of Article 87(1)
of the EC Treaty, the Commission looked into whether
the rents are non-discriminatory and correspond to
market rates and whether a return on invested capital is
generated.

(16) With respect to the conditions of access to the park, the
German authorities confirmed that, generally speaking,
any interested company can move to the industrial
estate.

(11) According to Germany, the documents show that the
rents on the Wörth industrial estate are at the upper
limit of rents on comparable sites in the region. Any
benefit for companies moving to the industrial estate in
the form of rents lower than market rates could therefore
be ruled out. Germany also submitted the profit forecasts
given in the business plan and a copy of the shareholder
contract.

(17) The Commission compared the rents payable by the
companies on the Wörth industrial estate with the
normal market rents for similar locations in the region.
The rents for similar storage/production sites in the
region vary between some DEM 5 per m2 (EUR 2,56 per
m2) and DEM 10 per m2 (EUR 5,11 per m2) while those
for office premises vary between DEM 7,5 per m2
(EUR 3,83 per m2) and DEM 12 per m2 (EUR 6,14 per
m2) for office premises.

19.10.2002

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Official Journal of the European Communities

L 282/59

(18) Accordingly, the Commission considers that the rents
payable on the Wörth industrial estate of DEM 9 per m2
(EUR 4,6 per m2)
for production premises and
DEM 12 m2 (EUR 6,14 per m2) for office premises
can be considered to be normal market rents which
correspond to rents for similar locations in the region.
On the basis of the business plan provided by the
German authorities, it also notes that the project gener-
ates a positive net return for IPW and its shareholders.

HAS ADOPTED THIS DECISION:

Article 1

The rental conditions for the Wörth industrial estate corre-
spond to ‘normal market conditions’ and do not therefore
constitute State aid within the meaning of Article 87(1) of the
EC Treaty.

VII. CONCLUSION

This Decision is addressed to the Federal Republic of Germany.

Article 2

Done at Brussels, 24 April 2002.

(19) The Commission finds

the rental conditions
that
described above correspond to market conditions and
do not therefore constitute State aid within the meaning
of Article 87(1) of the EC Treaty,

For the Commission

Mario MONTI

Member of the Commission