State aid — United Kingdom — Aid C 13/02 (ex N 27/02) — Stamp duty exemption for non-residential property in disadvantaged areas — Invitation to submit comments pursuant to Article 88(2) of the EC Treaty (Text with EEA relevance)
Date: 2002-04-27
Institutions: European Commission
Subjects: European Commission, State aid, United Kingdom, control of State aid, exchange of information, industrial building, stamp duty, tax exemption

C 102/22

EN

Official Journal of the European Communities

27.4.2002

STATE AID — UNITED KINGDOM

Aid C 13/02 (ex N 27/02) — Stamp duty exemption for non-residential property in disadvantaged
areas

Invitation to submit comments pursuant to Article 88(2) of the EC Treaty

(2002/C 102/14)

(Text with EEA relevance)

By means of the letter dated 27 February 2002, reproduced in the authentic language on the pages
following this summary, the Commission notified the United Kingdom of its decision to initiate the
procedure laid down in Article 88(2) of the EC Treaty concerning the abovementioned aid.

Interested parties may submit their comments on the aid in respect of which the Commission is initiating
the procedure within one month of the date of publication of this summary and the following letter, to:

European Commission
Directorate-General for Competition
State Aid Registry
B-1049 Brussels
Fax (32-2) 296 12 42.

These comments will be communicated to the United Kingdom. Confidential treatment of the identity of
the interested party submitting the comments may be requested in writing, stating the reasons for the
request.

SUMMARY

3. State aid character of the scheme

1. By letter dated 21 December 2001, and registered by the
Commission on 9 January 2002, the UK authorities notified
the aid scheme ‘Stamp duty exemption for non-residential
property in disadvantaged areas’.

2. Description of the aid scheme

the

rates,

The notified aid takes the form of an exemption from stamp
duties on the transfer of non-residential property situated in
disadvantaged areas. These stamp duties are taxes on
such
relating to sales and new leases of
documents
the
property. At present duty
value of
exemption would be between 1 % and 4 % of
the
purchase price in the case of a purchase of a property
and between 1 % and 24 % of the average annual rent in
the case of a new lease. The areas eligible under the scheme
are selected on the basis of a set of indicators of social and
economic deprivation postcodes. Some 2 000 disadvantaged
areas have been selected covering around 23 % of the UK
population. The scheme would apply to all enterprises,
regardless of size and regardless of the sector in which
they are engaged. The annual budget cost of the scheme
is estimated at up to EUR 98 million.

Under the scheme, aid is granted through State resources (in
the form of a tax exemption) to undertakings located in
specific regions (namely only in designated disadvantaged
areas). The exemption reduces the investment costs of
companies investing in non-residential property in eligible
areas and provides an advantage to such companies over
companies
the
exemption applies to all transfers of land and buildings, it
will
inevitably benefit undertakings which are engaged in
inter-State trade, or in a business sector in which there is
there is no limit on the
inter-State trade.
amount of aid that can be granted to a beneficiary.
It
must therefore be concluded that the exemption may give
rise to aid which affects competition in inter-State trade.

investing in other

areas. Given that

In addition,

In view of the above, the Commission considers that the
measure constitutes State aid within the meaning of Article
87(1) of the EC Treaty.

4. Procedural considerations

The UK has complied with the procedural requirements of
Article 88(3) EC by notifying the abovementioned aid
scheme before putting it into effect.

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Official Journal of the European Communities

C 102/23

5. Assessment of the compatibility of the aid measure

The aim of the measure is to promote the development/
regeneration of disadvantaged geographical areas in the UK
through the provision of aid for the transfer of non-resi-
dential property. Aid for investment in disadvantaged areas
is covered by the guidelines on national regional aid (OJ
C 74, 10.3.1998, p. 9), hereinafter
referred to as the
‘regional aid guidelines’, and by the guidelines on State aid
(OJ C 146,
for undertakings
14.5.1997, p. 6), hereinafter referred to as the ‘deprived
urban areas guidelines’. The Commission has therefore
examined the measure on the basis of these two guidelines.
As a result of this examination, the Commission has the
following doubts as to the measure's compatibility with the
common market:

in deprived urban areas

(a) A first doubt concerns the geographical coverage of the
the Community's State aid rules,
measure. Under
the development of disad-
investment aid aimed at
vantaged areas should be limited to either
regions
eligible for regional State aid under Article 87(3)(a) or
(c), defined in accordance with the provisions laid down
in point 3 of the regional aid guidelines, or to deprived
urban areas, defined in accordance with the provisions
laid down in point
the deprived urban area
guidelines.

IV of

concentration of regional aid areas, which is a leading
principle of the Community's regional aid policy (1).

investment’. The Commission has

(b) Under both the regional aid guidelines and the deprived
investment aid is limited to
urban areas guidelines,
doubts
‘initial
whether
sale of non-residential property and the
creation of new leases for such property constitutes in
all circumstances ‘initial investment’ as defined in these
guidelines.

(c) Assets that are the object of successive transfers of
ownership qualify for stamp duty exemption on each
occasion. Furthermore,
the scheme does not exclude
assets for whose acquisition aid has already been paid
in the past (under other aid schemes). The Commission
doubts whether this is in line with the provision of the
guidelines on national regional aid that, in the event of a
purchase, assets for whose acquisition aid has already
been granted prior to the purchase should be deducted.

(d) According to the UK, the aid intensity of the scheme
will never exceed 4 %. However, the Commission doubts
in cases where the stamp duty exemption is
whether,
cumulated with other aid, the UK authorities will be
able to ensure that
the total amount of aid will
respect
the aid intensity ceilings established in the
regional aid map (or other ceilings that may apply).

for

the

the

areas

On 17 August 2000, the Commission approved the UK
regional aid map (N 265/2000), listing the areas eligible
for regional State aid in the period 2000-2006. The
stamp duty exemption will apply to a list of areas
covering some 23 % of the UK population. Information
provided by the UK suggests that between 40 % and
stamp duty
eligible
50 % of
exemption could fall outside the regional aid map. It
is true that the deprived urban area guidelines allow
for relatively high levels of investment aid in deprived
urban areas outside regional aid areas. However, point 8
of
the population
coverage of aid under
the deprived urban areas
guidelines should not exceed around 1 % of national
population. The coverage of the areas that are eligible
for stamp duty exemption and that are not included in
the regional aid map is much higher than 1 % of the UK
population.

these guidelines provides

that

therefore

doubts whether

The Commission
the
geographical coverage of the stamp duty exemption is
compatible with the abovementioned guidelines.
It is
concerned that the approval of the scheme,
including
‘designated disadvantaged areas’ would in
the list of
effect
the UK
regional aid map. In turn, this would undermine the

lead to a significant widening of

vehicles,

(e) According to the notification, the scheme applies to all
sectors,
including the sectors for which special rules
apply (transport, steel, shipbuilding, synthetic fibres,
motor
and
marketing of agricultural products listed in Annex I of
the EC Treaty, fisheries and coal). It is unclear though
how the UK authorities will ensure that the special rules
applicable to aid in the abovementioned sectors will be
complied with.

production,

processing

the

(f) The notified scheme does not impose any restriction on
from the
the types of companies that could benefit
stamp duty
exemption. The Commission doubts
whether this is in conformity with the deprived urban
area guidelines, which restrict aid to small companies
only and which impose further conditions on the bene-
ficiaries of such aid (namely that he must carry on its
principle economic activity and invest
in the area
designated as a deprived urban area and that he must
reserve at least 20 % of the new jobs created for persons
having their domicile in a deprived area).

(1) In this context, the guidelines on national regional policy point out
that regional aid ‘. . . is conceivable in the European Union only if it
is used sparingly and remains concentrated on the most disad-
If aid were to become generalised and, as it
vantaged regions.
were,
its incentive quality and its
it would lose all
the norm,
economic impact would be nullified. At the same time, it would
interfere with the normal interplay of market forces and reduce the
efficacy of the Community economy as a whole’.

C 102/24

EN

Official Journal of the European Communities

27.4.2002

TEXT OF THE LETTER

‘The Commission wishes to inform the United Kingdom that,
having examined the information supplied by your authorities
on the aid measure referred to above, it has decided to initiate
the procedure laid down in Article 88(2) of the EC Treaty.

I. PROCEDURE

1. By letter dated 21 December 2001, and registered by the
Commission on 9 January 2002,
the UK authorities
notified a scheme exempting transfers of non-residential
property in disadvantaged areas from stamp duty. A
bilateral meeting between the UK authorities and the
Commission was held on 5 February 2002 to clarify
some points of the notification.

II. DESCRIPTION OF THE AID MEASURE

2. Aim of the measure

The aim of the measure is to contribute to the physical,
economic and social regeneration of disadvantaged areas
by means of reducing the cost of acquiring non-residential
property in these areas. As such the scheme is part of the
UK Government's ‘Enterprise in disadvantaged commun-
ities’ initiative.

3. The form and nature of the aid

The notified aid takes the form of an exemption from
stamp duty on the transfer of non-residential property
and on the creation of new leases for such property.

Stamp duties are taxes on documents. The main stamp
duties levied in the UK at the present day are on sales
and leases of land and buildings, and transfers of shares.

The eligible areas, which have average populations of
7 000, are selected on the basis of
the most recent
values for indices of deprivation developed for each of
the four nations of
the United Kingdom (no suitable
single measure of deprivation exists for the UK — so it
was necessary to use the four different but comparable
indices).
In England, Wales and Northern Ireland the
geographical units used for the analysis are the electoral
wards or divisions. In Scotland the geographical units used
are postcodes.

Some 2 000 disadvantaged areas have been designated in
the UK, covering 22 % of the total population in England,
18 % in Scotland, 47 % in Wales and 40 % in Northern
Ireland. The present list of eligible areas has been set out
in ‘The Stamp Duty (Disadvantaged Areas) Regulations
2001’
(Statutory Instruments 2001/3747). However, the
UK indicated that the qualifying areas will be kept under
the list are likely to be
review, but
infrequent.

that changes of

6. Beneficiaries

The scheme applies to undertakings of any size and
operating in any sector of the economy.

7. Budget of the scheme

The annual budget cost of the scheme is estimated at up to
GBP 60 million (around EUR 98 million). It is estimated
that, each year, at least 1 200 transfers will be exempted
from stamp duty under the scheme.

8. Legal basis of the scheme

Primary legislation: Section 92 and Schedule 30 Finance
Act 2001.

4. Eligible costs and aid intensity

Secondary legislation:

Eligible costs comprise the consideration (i.e. purchase
price) of the property (i.e. land and/or buildings) situated
in the qualifying area, or the average annual rental for a
new lease. Apportionment is required if the property is
only partially situated in a qualifying area.

Stamp duty rates vary according to the purchase price of
leases,
the property concerned and,
according to the average annual rental and the duration
of the lease.

in the case of

At present duty rates, the value of the exemption would be
between 1 % and 4 % of the purchase price in the case of a
purchase of a property and between 1 % and 24 % of the
average annual rent in the case of a new lease.

5. Geographical coverage of the scheme

The stamp duty exemption would apply to sales and new
leases of non-residential property located in ‘designated
disadvantaged areas’ in the UK.

— SI 3746/2001 (The Variation of Stamp Duties Regu-

lations),

— SI 3747/2001 (The Stamp Duty (Disadvantaged Areas)

Regulations),

— SI 3748/2001 (The Finance Act 2001, Section 92(8),

(Specified Day) Order).

9. Duration of the scheme: 2002-2011.

III. ASSESSMENT OF THE AID MEASURE

10. In accordance with Article 6(1) of Council Regulation (EC)
No 659/1999 of 22 March 1999, the decision to initiate
proceedings shall summarise the relevant issues of fact and
from the
law, shall
include a preliminary assessment
Commission as to the aid character of
the proposed
measure, and shall set out the doubts as to its compati-
bility with the common market.

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Official Journal of the European Communities

C 102/25

11. Procedure

The UK authorities have complied with the procedural
requirements of Article 88(3) of
the EC Treaty by
notifying the abovementioned aid scheme before putting
it into effect.

12. The existence of aid

The Commission considers, at this stage of the procedure,
that the measure constitutes State aid within the meaning
of Article 87(1) of
the
following reasons:

the EC Treaty, and this for

— State resources are involved because tax is foregone.

— The measure is selective because it is targeted upon

particular geographical areas.

— The measure will reduce the investment costs for
companies investing in non-residential assets in the
eligible areas. It will therefore provide an advantage
to such companies over other companies investing in
other areas, and therefore not receiving the exemption.

in a business sector

it will, among others,

— Because the exemption applies to all conveyances and
in land in the
transfers of estates and interests
designated areas
inevitably
benefit undertakings which are engaged in inter-State
trade, or
in which there is
inter-State trade. Furthermore,
the scheme does not
provide that the limits laid down in Council Regulation
(EC) No 69/2001 of 12 January 2001 on the
application of Articles 87 and 88 of the EC Treaty to
de-minimis aid will be respected. Accordingly, the new
to aid which affects
rise
exemption may give
competition in inter-State trade.

13. Exemption grounds

(a) Article 87(2) of the EC Treaty lists certain types of aid
that are compatible with the EC Treaty. In view of the
nature and purpose of the aid, and the geographical
coverage of the scheme, the Commission considers, at
this stage of the analysis, that subparagraphs (a), (b)
and (c) are not applicable to the measure in question.

(b) Article 87(3) specifies other forms of aid, which may
be regarded as compatible with the common market.
In view of the nature and purpose of the aid measure
and its geographical scope, the Commission considers,
at
the
subparagraphs (a), (b), (d) and (e) of Article 87(3) are
not applicable either.

investigation,

stage

that

this

the

of

(c)

In the notification, the UK authorities appear to agree
with the above analysis and suggest that the question
is whether the aid measure is compatible with the
common market on the basis that
facilitate
the development of certain economic areas and it
trading conditions to an
will not adversely affect
extent
(Article
common interest
contrary to the
87(3)(c) of the EC Treaty).

it will

(d) The coverage of the notified measure is not limited to
SMEs, nor to firms in difficulty, nor to any one of the
following activities: R & D, environmental protection
as defined in the Community guidelines on State aid
for environmental protection (OJ C 37, 3.2.2001, p. 3),
training, the creation or maintenance of employment.
Therefore, the Commission considers, at this stage of
the analysis,
the notified measure can not be
declared compatible with the common market on the
basis of its conformity with any of the following regu-
lations, frameworks or guidelines:

that

— Commission Regulation (EC) No 70/2001 of 12
January 2001 on the application of Articles 87
and 88 of the EC Treaty to State aid to small
and medium-sized enterprises (OJ L 10, 13.1.2001,
p. 33);

— Community guidelines on State aid for rescuing
and restructuring firms in difficulty (OJ C 288,
9.10.1999, p. 2);

— Community framework for State aid for research
and development (OJ C 45, 17.2.1996, p. 5);

— Community guidelines on State aid for environ-
mental protection (OJ C 37, 3.2.2001, p. 3);

— Commission Regulation (EC) No 68/2001 of 12
January 2001 on the application of Articles 87
and 88 of the EC Treaty to training aid (OJ L 10,
13.1.2001, p. 20);

— Guidelines on employment (OJ C 334, 12.12.1995,

p. 4).

(e) The aim of

the measure is to promote the devel-
opment/regeneration of disadvantaged areas in the
UK, which are geographically defined. Therefore, the
Commission has examined the compatibility of
the
measure on the basis of the guidelines on national
regional aid (OJ C 74, 10.3.1998, p. 9), hereinafter
referred to as the ‘regional aid guidelines’ and the
guidelines on State aid for undertakings in deprived
urban areas (OJ C 146, 14.5.1997, p. 6), hereinafter
referred to as the ‘deprived urban area guidelines’. The
results of this analysis are presented below.

14. Conformity with the regional aid guidelines

The stamp duty exemption is granted in relation to the
transfer of non-residential property in disadvantaged areas.
In its notification, the UK argues correctly that the notified
scheme is therefore primarily focussed on investment.
aid for
According
to the
investment
in disadvantaged areas may be compatible
with the common market, but only if certain conditions
are satisfied. At
the
stage of
Commission has doubts whether
the notified scheme
respects the conditions set out in these guidelines:

the examination,

aid guidelines,

regional

this

C 102/26

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Official Journal of the European Communities

27.4.2002

(a) By letter No SG(2000) D/106293 of 17 August 2000,
the Commission approved the UK regional aid map for
the period 2000 to 2006 (N 265/2000). The map
defines the areas eligible for national regional aid
under the derogations of Article 87(3)(a) and (c) of
the EC Treaty. The Article 87(3)(a) regions included
in the map were defined on the basis of EU-wide
criteria (NUTS level II regions with a GDP per capita
in PPS lower than 75 % of the Community average).
The Article 87(3)(c) areas were selected on the basis of
geographical units and social and economic indicators,
proposed by the UK authorities themselves. The stamp
duty exemption will apply to transfers of non-resi-
dential property situated in so-called ‘designated disad-
vantaged areas’, which have been defined on the basis
of different geographical units and indicators (see point
5 above). The result of this approach is that a number
of areas eligible under the notified measure does not
fall within the areas eligible for regional aid as defined
in the present UK regional aid map.
Information
provided by the UK in the context of an examination
of another State aid scheme (namely the Community
development venture fund (N 606/2000)), suggests
that the proportion of the disadvantaged areas falling
outside the regional aid map is very significant (2).

doubts whether

lead to a significant widening of

The Commission therefore
the
geographical coverage of the stamp duty exemption
is compatible with the regional aid guidelines.
It is
concerned that the approval of the scheme, including
the list of ‘designated disadvantaged areas’ would in
the UK
effect
regional aid map. In turn, this would undermine the
concentration of regional aid areas, which is a leading
principle of the Community's regional aid policy (3). In
order to clarify this point, the Commission would also
ask the UK authorities to provide clear information on
the extent to which the two lists overlap.

(b) Point 4.1 of the regional aid guidelines provides that
the object of regional aid is to secure either productive
investment (initial investment) or job creation that is
linked to investment. Point 4.11 specifies that also aid
for job creation should be linked to the carrying out of
initial investment. Initial investment is defined in point
4.4 of the guidelines as ‘an investment in fixed capital
relating to the setting-up of a new establishment, the
extension of
the
starting-up of an activity involving a fundamental
change in the product or production process of an
existing establishment (through rationalisation, diver-

establishment, or

an existing

(2) By letter of 14 January 2002, the UK authorities analysed the
degree of overlap between the 20 % most deprived wards and the
Article 87(3)(a) and (c) areas in England. Their analysis concluded
that only 57 % of these most deprived wards were also included in
the regional aid map.

(3) In this context, the guidelines on national regional policy point out
that regional aid ‘. . . is conceivable in the European Union only if it
is used sparingly and remains concentrated on the most disad-
If aid were to become generalised and, as it
vantaged regions.
were,
its incentive quality and its
it would lose all
the norm,
economic impact would be nullified. At the same time, it would
interfere with the normal interplay of market forces and reduce the
efficacy of the Community economy as a whole’.

the

The

or modernisation)’.

duty
sification
exemption concerns
sale of non-residential
property and the creation of new leases for such
property. The Commission has doubts whether such
transactions can in all circumstances be classified as
initial investment as defined in the guidelines.

stamp

(c) The notification points out that any transaction can
benefit only once from the stamp duty exemption.
The implication of this is, however, that assets that
are the object of successive transactions (e.g. successive
transfers of ownership), would qualify for stamp duty
exemption on each occasion. Furthermore, assets for
whose acquisition aid has already been paid in the past
(under other aid schemes) are not excluded from the
scheme. In view of this, the Commission has doubts
whether the scheme respects point 4.5 of the regional
aid guidelines, which provides that in the event of a
purchase, assets for whose acquisition aid has already
been granted prior to the purchase should be deducted.

(d) Point 5.4 of the regional aid guidelines provides that
regional aid schemes are approved by the Commission,
subject to the aid intensity ceilings defined in the map.
Point 4.18 specifies that the total amount of regional
investment aid should respect the aid intensity ceilings
set out in the regional aid map. Point 4.21 requires
that, in cases where the aid under one scheme may be
combined with aid under other schemes, the Member
State must specify, for each scheme, the method by
which it will ensure that the regional aid intensity
In the notification,
ceilings will be complied with.
the UK argues that the intensity of the scheme will
never exceed 4 %. It is unclear though how the UK
arrives at that percentage.
In addition, the UK does
not exclude the possibility that aid under the notified
scheme is cumulated with aid under other schemes. In
fact, the notification explicitly mentions the possibility
that aid under the scheme is cumulated with aid from
certain risk capital measures. The Commission doubts
whether, in cases where the stamp duty exemption is
cumulated with other aid, the UK authorities will be
able to ensure that the total amount of aid will respect
the aid intensity ceilings established in the regional aid
map. In this context, the Commission would ask the
UK authorities to clarify the way in which the aid
intensity will be calculated in cases involving the estab-
lishment of new leases. It would also ask the UK to
clarify how it will ensure that cumulation rules are
complied with.

is

subject

fisheries and coal)

(e) Point 2 of the regional aid guidelines provides that the
granting of
(regional) State aid in certain sectors
(transport, steel, shipbuilding, synthetic fibres, motor
to specific
vehicles,
restrictions. The guidelines on national regional aid
excludes specifically from its scope the production,
processing and marketing of Annex I products. The
guidelines on State aid for undertakings in deprived
urban areas are without prejudice of other State aid
rules. Therefore any aid granted to undertakings
operating
and
marketing of Annex I products is to be assessed
according to the Community guidelines for State aid

production,

processing

the

in

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Official Journal of the European Communities

C 102/27

In addition, special rules
in the agriculture sector.
apply to large investment projects. According to the
notification, the scheme applies to all sectors.
It is
unclear though how the UK authorities will ensure
the aid granted under the notified scheme to
that
companies engaged in the abovementioned sectors or
to large investment projects will comply with the
special rules applicable. The United Kingdom auth-
orities are requested to provide necessary information
to permit the assessment of the measure at issue under
the State aid rules applicable to the agriculture sector.

15. Conformity with the deprived urban area guidelines

The deprived urban area guidelines make provision for the
granting of aid for investment in deprived geographical
areas, subject to specific conditions. At this stage of the
examination,
the Commission has doubts whether the
notified scheme respects these conditions:

(a) Point 5 of

the deprived urban area guidelines
recognises that there can be a need for investment
aid to deprived urban areas that are not included in
the
the regional aid map. However, point 8 of
guidelines provides that the total population covered
by such areas should not exceed 1 % of the national
population (or,
justified by the
in circumstances
Member State on the basis of objective socioeconomic
data at a level slightly above this ceiling). Areas
covered should be geographically identifiable and
homogeneous;
they should have a population of
between around 10 000 and 30 000 and belong to
cities or urban agglomerations with around 100 000
inhabitants or more and have significantly worse
socioeconomic
than both the national
average and the average for the cities to which they
belong. Also
urban
selected
community initiative could be taken into account.

statistics

under

areas

the

As was pointed out in point 14(a) above, a significant
number of areas eligible under the notified measure
probably falls outside the regional aid map. The
number of people living in these areas is therefore
likely to be far in excess of the 1 % ceiling set out
in the deprived urban area guidelines. In addition, it
is unclear to what extent the areas that qualify under
the notified scheme and that are outside the regional
aid map are satisfying the other eligibility criteria laid
down in point 7 of the urban aid guidelines. The
Commission therefore doubts whether the areas that

qualify under the notified scheme and that are not
included in the regional aid map are selected in
conformity with the criteria laid down in paragraph
7 and 8 of
It requests
the urban aid guidelines.
further clarification on the population coverage of
the areas that qualify under the scheme and that are
not eligible for regional aid and on the extent to which
these areas satisfy the eligibility criteria laid down in
point 7 of the deprived urban area guidelines.

is

this

(b) The notified scheme does not impose any restriction
on the types of companies that could benefit from the
stamp duty exemption. The Commission doubts
whether
in conformity with the deprived
these guidelines
urban area guidelines. Point 10 of
restricts aid to small companies only, arguing that
‘extending the benefits of the aid to large enterprises
would have disproportionate
in terms of
distortion of competition and the negative impact on
the guidelines
cohesion’.
imposes further restrictions (namely that
the bene-
ficiary must carry on its principle economic activity
and invest in the area designated as a deprived urban
area and that he must reserve at least 20 % of the new
jobs created for persons having their domicile in a
deprived area).

In addition point 12 of

effects

(c) The deprived urban area guidelines also provide that
aid should be limited to initial investment projects and
that the total amount of aid should be limited to 26 %
nge of eligible investment costs (point 14 of
the
guidelines). The doubts expressed in points 14(b) and
14(e) therefore also apply in this case.

IV. DECISION

16. In the

the

light of

foregoing

considerations,

the EC Treaty,

the
Commission, acting under the procedure laid down in
Article 88(2) of
the United
requests
Kingdom to submit
its comments and to provide all
such information as may help to assess the aid scheme
‘Stamp duty exemption for non-residential property in
disadvantaged areas’, within one month of the date of
receipt of this letter.

17. The Commission wishes to remind the United Kingdom
that Article 88(3) of the EC Treaty has suspensory effect,
and would draw your attention to Article 14 of Regulation
(EC) No 659/1999, which provides that all unlawful aid
may be recovered from the recipients.’