2002/901/EC: Commission Decision of 19 June 2002 on State aid implemented by the Netherlands for operations by Dutch tugboats in seaports and on inland waterways in the Community (notified under document number C(2002) 2158) (Text with EEA relevance)
Date: 2002-06-19
Institutions: European Commission
Subjects: Netherlands, State aid, control of State aid, harbour installation, inland waterway transport, maritime transport

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Official Journal of the European Communities

L 314/97

COMMISSION DECISION

of 19 June 2002

on State aid implemented by the Netherlands for operations by Dutch tugboats in seaports and
on inland waterways in the Community

(notified under document number C(2002) 2158)

(Only the Dutch text is authentic)

(Text with EEA relevance)

(2002/901/EC)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

of information which led to several meetings between
the complainant and Commission staff.

(4)

(5)

(6)

(7)

(8)

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

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

Having regard to Council Regulation (EC) No 659/1999 of 22
March 1999 (1) laying down detailed rules for the application
of Article 93 of the EC Treaty,

Having called on interested parties to submit their comments
pursuant to the provisions cited above (2) and having regard to
their comments,

Whereas:

1. PROCEDURE

(1)

(2)

lodged

complaint

on 17 April 2000,

the
By
Commission was informed that
the Netherlands had
allegedly illegally granted State aid in respect of tonnage
tax to tugboat operations
in ports and on inland
waterways in the Community. Three other parties (3)
raised concerns about this issue, one of whom filed a
formal complaint.

the Commission
By letter of 12 September 2000,
addressed a number of preliminary questions to the
Dutch authorities, which were discussed in a meeting
and formally replied to by letter of 8 November 2000,
as rectified by a corrigendum of the same day.

Following a letter from Germany of 18 January 2001, a
meeting on this matter was held with the German
authorities on 29 March 2001.

On the basis of the information at their disposal, the
Commission services held a meeting with the Dutch
authorities on 19 April 2001.

By letter dated 11 July 2001, the Commission informed
the Netherlands that
it had decided to initiate the
procedure laid down in Article 88(2) of the EC Treaty in
respect of the aid.

The Commission decision to initiate the procedure was
the European
published in the Official
Communities (4). The Commission invited interested
parties to submit their comments.

Journal

of

The Commission received initial comments from the
Dutch government and comments from 51 interested
parties.
It forwarded them to the Netherlands, which
was given the opportunity to react; its comments were
received by letter of 18 April 2002, registered on 22
April 2002 (A/57255).

2. DETAILED DESCRIPTION OF THE AID

(3)

Furthermore, the complainant who filed the complaint
of 17 April 2000 provided numerous additional items

(1) OJ L 83, 27.3.1999, p. 1.
(2) OJ C 298, 24.10.2001, p. 5.
(3) Letter of 4 August 2000, registered in the DG for Energy and

Transport on 9 August 2000.
Formal complaint of 4 April 2001, registered in the Secretariat of
the Commission on 6 April 2001.

2.1. Commission Decisions in Cases N 394/88,
N 384/91, N 738/95, NN 89/97 and N 8/98

(9)

By letter of 23 August 1988,
the Netherlands first
the
notified a fiscal
competitive position of the Dutch fleet. The Netherlands
referred to a 1985 Commission communication to the

facility for the improvement of

(4) See footnote 2.

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concerning

Council
sea
transport policy. These measures were approved by the
Commission by letter of 2 December 1988.

common Community

a

(10) On 12 December 1994,

the Commission decided to
raise no objections to income tax and social security
contribution reductions of 19 % and 5 % respectively
(the (cid:145)fiscal facility(cid:146)) (Case N 384/91).

(18)

(11)

By letter of 12 April 1996 (SG(96) D/3852),
the
Commission informed the Netherlands of its decision to
raise no objections to further reductions in income tax
and social security contributions of up to 38 % and
facility(cid:146)) and to raise no
10 % respectively ((cid:145)fiscal
objections to the introduction of a (cid:145)tonnage tax(cid:146) (Case N
738/95).

(12) As announced in its letter of 12 April 1996 mentioned
in recital 11, the Commission reassessed and reapproved
the tonnage tax and informed the Netherlands thereof
by letter of 31 July 1997 (SG(97) D/6453) (Case NN
89/97).

(13)

By letter of 20 May 1998 (SG(98) D/4032),
the
Commission informed the Netherlands of its decision to
raise no objections to an increase from 38 % to 40 % in
the aid under the fiscal facility approved under Case N
738/95.

2.2.

(cid:145)Fiscal facility(cid:146) and (cid:145)tonnage tax(cid:146)

(19)

(20)

(14)

(15)

tax and social

The (cid:145)fiscal facility(cid:146) provides for reductions in the levels of
income
for
Community seafarers normally paid by the employer.
Such
the
is
competitiveness of the Dutch merchant fleet.

contributions

a measure

intended

improve

security

to

tax(cid:146)

The (cid:145)tonnage
is an optional measure regarding
corporate taxation of shipping companies. Under the
tonnage tax, profits from maritime shipping activities
are established at a standard rate on the basis of the
tonnage operated by the shipping company irrespective
of the actual profits made or the associated costs. Such
a measure
the
also
competitiveness of the Dutch merchant fleet.

intended

improve

to

is

(16) Neither of the Commission decisions in Cases N 738/95
the (cid:145)tonnage tax(cid:146), see
and NN 89/97 (extension of
below) refers to tugboat operations or to tugboats in
particular.

are clearly focused on transport operations carried out
(mainly) at sea and include some further explanations,
according to which tugboat operations carried out
mainly at sea would qualify for the fiscal facility and the
tonnage tax.

It should be added that
the tax law notified to the
Commission in this context is entitled (cid:145)Belastingwetten
in het belang van de zeescheepvaart(cid:146) (Tax law related to
seagoing shipping). The extent to which the information
provided during the notifications in the abovementioned
cases
transport
exclusively
activities carried out at sea is illustrated below.

on maritime

focused

2.3.1. Notification in Case N 384/91

The first notification in this context concerns Case N
384/91 which was approved in 1995. The notified
law (5) provides that (cid:145)seagoing ship means a ship issued
with a certificate of registry within the meaning of
Article 3(1) of
(Certificates of
the (cid:147)Zeebrievenwet(cid:148)
Registry Act), (cid:133) that is operated at sea as part of a
commercial undertaking or is intended for tugboat or
rescue activities at sea and is engaged in providing such
services to seagoing ships, with the exception of ships
used for pilot services.(cid:146)

The explanatory note on this article (page 11) provides
that the seagoing ship must be operated at sea as part
of a shipping undertaking or intended and used for
tugboat or
seagoing ships. A
seagoing ship that is used both at sea and on inland
waterways
sea
provided its main activities are carried out at sea.

is considered as being operated at

rescue activities

for

2.3.2. Notification in Case N 738/95

(21) According

to

the

from the Dutch
notification
authorities, the only change in the 1995 Law as regards
the (cid:145)fiscal facility(cid:146), between Case N 348/91 and Case N
738/95, was
aid. The prevailing
amount of
definition of (cid:145)seagoing ship(cid:146) remained unchanged as a
basis for Case N 738/95.

the

2.3. Relevant scope of the notifications

(22)

for
the increase in aid intensity
The same applies
between the fiscal
facility approved under Case N
738/95 and Case N 8/98, where nothing else changed
apart from the increase in aid intensity.

(17)

The notifications and the information provided by the
Dutch authorities in the cases mentioned in section 2.2

(5) Tax and National Insurance Contribution Scheme for Shipping Act

1994.

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(23) Article 8c(2) of the 1964 Income Tax Act, as amended
by the law notified as Case N 738/95 (6), provided that:
(cid:145)For the purpose of this Article (related to tonnage tax),
profits from shipping shall be taken to be profits earned
from the use of a ship for the transport of goods or
persons in international traffic over sea (cid:133) as well as
profits earned from the use of a ship for towing or the
provision of general assistance at sea to the ships
referred to above.(cid:146)

2.3.3. Information provided in Case NN 89/97

(27)

The documentation provided for the reapproval of the
tonnage tax focuses essentially on the effectiveness of
for
the measure and contains no new conditions
qualification for the aid.

(24)

(25)

the

23,

recital

In the explanatory memorandum on the amending
law (7) mentioned
following
in
interpretation of Article 8c(2) was given:
the
(cid:145)For
purpose of the tonnage tax basis, profits from shipping
are taken to be profits earned from the use of a ship for
the transport of goods or persons in international traffic
over sea (cid:133) as well as profits earned from the use of a
ship for towing or the provision of general assistance at
sea to ships.(cid:146)

for

traffic over

(cid:145)International

That explanatory memorandum further contained the
following paragraph:
sea:
Following from the definitions given [in Article 50 of
the Income Tax Act 1964 and Article 19 of
the
the
the purpose of
Corporate Tax Act 1969],
regulation under consideration, international traffic over
sea is taken to mean traffic between a Dutch port and a
foreign port and traffic between one foreign port and
another. This does not cover traffic between two Dutch
ports and the associated transport from the port to the
depot or from the port to the consignee. The ship must
be employed at sea for the transport of goods and
persons. For the purposes of these regulations, a ship
which is used for both activities at sea and on inland
waterways is held as being used for activities at sea if
the main focus of the activities is at sea (cid:133)(cid:146).

(26)

Finally, it is mentioned that (cid:145)Towing and the provision
of general assistance: furthermore, ships intended to be
used for towing or providing general assistance to ships
at sea are taken into account for the purposes of the
tonnage basis(cid:146).

(6) Amendment to the Income Tax Act 1964, the Corporation Tax Act
1969 and the Tax and National Insurance Credit for Shipping Act
1995 (amendment to some of the tax laws relating to seagoing
shipping). Ministry of Finance, Directorate-General
for Taxation,
Board of Legislation for Direct Taxes, No WDB95/166, The Hague,
13 June 1995: for consideration by the Council of Ministers.

(7) Explanatory memorandum on the Amendment to the Income Tax
Act 1964, the Corporate Tax Act 1969 and the Tax and National
Insurance Credit for Shipping Act 1995 (amendment to some of
the tax laws relating to seagoing shipping).

2.3.4. Notification in Case N 8/98

(28)

The aid notified in Case N 8/98 concerns an increase in
aid intensity for the (cid:145)fiscal facility(cid:146) notified under Case N
738/95 (from 38 % to 40 %).

(29)

(30)

(31)

(32)

2.4. Grounds for initiating the procedure

formal

The Commission opened the
investigation
procedure in this case (Case C 56/01) on the grounds
that it considered that it had not approved maritime
transport State aid to operations by Dutch tugboats in
ports and on inland waterways in the Community
neither in Cases N 738/95 and NN 89/97 nor in any
other related decision (8).

This Commission decision was based, inter alia, on the
information provided by the Dutch authorities (letter of
8 November 2000), according to which a certain
number of the abovementioned port towage operations
were granted or could be granted maritime transport aid
under the schemes in Cases N 738/95 and NN 89/97.

in and around ports

the aid in question (tugboat
In decision C 56/01,
operations
and on inland
waterways in the Community) was therefore classified as
new aid, which a priori was not considered compatible
with the Treaty. The Netherlands was further requested
to suspend such aid payments with a view to limiting
potential damage caused to competitors by such illegal
grants.

3. COMMENTS FROM INTERESTED PARTIES

initial

comments

In the course of the procedure the Commission received
(a)
(b)
comments from 51 other interested parties and (c)
comments from the Netherlands on the comments from
the 51 interested parties.

from the Netherlands,

(8) This decision was challenged by the Netherlands before the

European Court of Justice (Case C-368/01).

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3.1. Initial comments from the Netherlands

provided separate and independent comments which
can be summarised as follows (9):

(33)

(34)

(35)

authorities

disagree with

reapproved by Commission decisions;

By letter of 7 August 2001, the Netherlands replied to
the opening of the procedure in Case C 56/01. The
the
essentially
Dutch
Commission’s decision to classify the subsidies
in
question as (cid:145)new(cid:146) aid, since they consider that: (a) the
(cid:145)fiscal facility(cid:146) and the (cid:145)tonnage tax(cid:146) were both approved
the
or
notification in Case N 738/95 provided for the (cid:145)tonnage
tax(cid:146) to apply to ships used for the provision of towage
services or assistance to seagoing ships, qualification
should be based on the construction and equipment of
from its
the tugboat and does not necessarily result
activities being carried out at sea;
(c) the letter of 8
November 2000 mentioned in paragraph 30 merely
reiterates this point.

(b)

that

inland
The Dutch authorities further point out
waterway towage takes place in areas distinct
from
seaports and that inland waterway tugs are not qualified
to operate at sea. Unlike inland waterway tugs, maritime
law applies to tugs as from the moment they provide
assistance to a seagoing ship, wherever such assistance
is provided.

It is also mentioned that the recent withdrawal of a
Dutch tugboat operator from the port of Hamburg
the fiscal arrangements are not decisive
shows that
factors as
regards competitive position. The Dutch
authorities also note that a number of other countries
apply the same fiscal regime as the Netherlands.

3.2. Comments from 51 other interested parties

(36)

The comments from the 51 other interested parties are
summarised below, grouped together by type of
comment.

(37)

Parties

1. Arnold Ritscher; 2. Bremer Reederverein; 3. Freie
Hansestadt Bremen; 4. Freie und Hansestadt Hamburg;
Johanssen & Son;
5. Handelskammer Hamburg; 6.
7. [(cid:133)] (*); 8. Rhenus AG & Co.; 9. St(cid:228)ndige Vertretung
der
10.
Unternehmensverband Hafen; 11. Hamburg Unterweser
Reederei GmbH; 12. Verband Deutscher Reeder; 13.
Wirtschaftsverband Weser; 14. Zentralverband der
Deutschen
(names
confidential)

Seehafenbetriebe;

Bundesrepublik

Deutschland;

and

15

16

(*) Business secret.

(38)

It is argued that the Dutch beneficiaries of the aid have
a substantial competitive advantage (arguments backed
up by a study from Price, Waterhouse Cooper (PWC)
submitted by the German Government) allowing them
to take a strong position on the German port towage
market. This situation is reflected by asset sales and job
shedding by German companies. The aid favours not
only Dutch towage companies but also Dutch ports.
in line with the
Moreover,
aid cannot be
Community guidelines on State
aid for maritime
transport when it is applied to national traffic on inland
waterways and/or
related to
competition between Community and non-Community
registers. The aid should therefore be recovered.

in ports and is not

the

(39) On behalf of a German tugboat company, party 17,
White & Case, made the following comments:
in
summary White & Case argued, inter alia, that there is a
distinction to make between (deep) sea towage and port
towage, since these represent different markets with
different contract length and often managed by separate
the same company. There is basically no
entities of
tugs and port
competition between Community port
tugs under third county flags. However, Dutch port
towage operators have a competitive advantage over
their counterparts in the Community since they receive
illegal aid which enables them to adopt aggressive
market behaviour.

(40) On the specific issue of which tugboats would qualify,
White & Case argues that even if technical criteria are to
be used to establish eligibility for aid, that does not
necessarily mean that a seagoing tug operating mainly
in port would be eligible for aid, since that would be
contrary to the reiterated principle of the law stating
that eligible operations must be carried out mainly at
sea. White & Case refers to Dutch national court cases
in which the government (fiscal authorities) argued that
port towage is not eligible for the aid in question and
where the government was overruled by the National
Court which considered port towage to be eligible.

(9) Not every individual

the comments
summarised. Nevertheless, since there are a number of similarities,
their comments have been grouped together.

interested party made all

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(41)

the Member State which is

Furthermore the maritime transport aid granted to
Dutch port towage operations is to be considered new
aid basically since the 1995 notification and at least
since 5 January 1999, the date on which the Dutch
authorities agreed to adapt all earlier legislation to the
(cid:145)new(cid:146) 1997 Community guidelines on State aid to
maritime transport. This is backed up by the argument
that any doubt as regards a notified text works to the
detriment of the Member State which notified it, since it
is
the
completeness and clarity of the content of a notification.
In this sense the Member State has to be considered as
the guarantor of legal certainty. The aid in question is
also contrary to the Community guidelines on State aid
to maritime transport which focus on competition
and non-Community
aspects between Community
registers, whereas port towage is basically not subject to
that type of competition. In the light of the foregoing
legitimate expectations by the
and in the absence of
the
Netherlands, White & Case
Commission should recover any such illegal aid from
which the operators concerned benefited even under
schemes prior to the 1995 notification.

responsible for

concludes

that

(42) Undertakings

18. Birger Gran; 19. Hual; 20. Hydro Belgium SA;
21. Krogstads Shippings; 22. Minerva Marine Inc.;
23. Mitsui OSK Shipping (Europe) Ltd; 24. NYK
Bulkship (Europe) Ltd; 25. Rotterdam Municipal Port
Management;
BV;
27. Simpson, Spence & Young Ltd; 28. Stolt-Nielsen
Transportation Group BV; 29. Thenamaris
(Ships
Inc.; 30. Vopak; and 31. Wallenius
Management)
Wilhelmsen

(Europe)

Sanko

Kisen

26.

(44) Undertakings

32. Cape Reefers; 33. Coerclerici Armatori; 34. Maritime
Services Aleuropa GmbH; 35. Pan Ocean Shipping Co
Ltd.; and 36. Polsteam (Benelux)

(45)

(46)

(47)

provided separate and independent comments which
can be summarised as follows (11):

They argued that the aid in question was approved and
is thus in line with the Community guidelines on State
aid to maritime transport. In this way tugowners from a
Member State can compete at the same cost level with
tugowners operating under open registers, although
with higher safety and quality standards.

The complaint triggering this case is based merely on
the fact that a German towage company cannot benefit
from tax advantages similar to those in the Netherlands
since Germany apparently refuses to implement similar
fiscal advantages.

The approach by the complainant, according to which
towage operations may qualify or not depending where
the towage services are provided, is too limited and fails
to reflect the economic and operational reality. The only
relevant distinction can be made on the basis of the
technical criteria for different types of tugboat.

(48) A protectionist attitude in favour of the German towage
market will result in less competition and higher towage
rates.

(49)

The towage market is international with competition
between international ports.

provided separate and independent comments which
can be summarised as follows (10):

(50) Undertakings

(43)

that any attempt

into the German towage market

The companies underline that the aid in question was
approved by the Commission,
to
interfere in a well regulated but free market would have
serious consequences, that a really free market can only
be achieved when there is an open market which
companies are free to enter, that the entry of Dutch
companies
in
accordance with the idea of free provision of services, as
advocated
proposal
concerning ports, and that only a free market situation
price/quality/
would
performance
in question will
consequently work in such a way that high safety and
quality
standards will be maintained along with
competitive long-term prices.

the most
ratio. The market

a Commission

legislative

efficient

ensure

in

is

37. Kotug Europe BV; 38. Kotug Schleppreederei
GmbH; 39. Adriaan Kooren BV; 40. Bais Maritiem BV;
41. Belgische Redersvereniging; 42. Corus Services; 43.
Multraship BV; 44. Nissan Carrier Europe BV; 45.
Noordzee-
Scheepvaart
kanaalgebied;
van
Koninklijke
Nederlandse Reders; 47. Smit International NV; 48. Unie
in Nederland BV; 49.
van Redding- en Sleepdienst
Wagenborg Sleepdienst BV; 50. Wijsmuller Marine
Service BV; 51. Zeeland Seaports

Vereniging

Vereniging

Industrie

46.

&

provided separate and independent comments which
can be summarised as follows (12):

(10) See footnote 9.

(11) See footnote 9.
(12) See footnote 9.

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(51)

It is argued that the aid constitutes (cid:145)existing aid(cid:146) since
the Commission approved it. Existing aid cannot be
recovered. Considering the approved aid as (cid:145)new aid(cid:146) is
in breach of the principle of legitimate expectations and
legal certainty. The approved aid is in line with the aims
of the rules on State aid for maritime transport, the aim
being to create a level playing field for all shipping
companies exposed to international competition.

(57)

(52)

The number of Dutch tugboats which qualify as
seagoing tugs is still below 10 % and not all of them
make use of the measures.

(53)

in

by

are

vessels

covered

Ports have now an open market
structure where
tugboats under the flags of non-Community countries
operate. The fact that tugboats providing assistance to
seagoing
the
ports
arrangement is perfectly appropriate since the markets
the same level playing field
are open. Consequently,
must be created both within the ports and beyond. A
purely geographic criterion,
in particular the area of
activity, should not be used to exclude tugboats which
are seaworthy and have a crew holding the certificates
required to work onboard seagoing vessels. If, however,
the State aid for tugs is abolished, tariffs will increase.
Such aid measures ensure maritime quality standards
and limit the comparative disadvantage over tugboats
operated under open registers and employing low-wage
crews.

(54)

The comments state that a recovery order should be
avoided. An order to adapt the existing rules to the new
rules should provide for sufficient time to adjust the
current business arrangements to the new rules.

towage

Furthermore, the Dutch authorities argue that towage
assistance to seagoing vessels must be in line with the
guidelines independently of where the service is carried
out. Community port
companies/activities
would be internationally disadvantaged if they could not
benefit from the aid. The fact that Germany has chosen
not to allow its tax facilities to apply in Germany but
only in European ports cannot be used as an argument
against the Dutch tax facilities applied in German ports.
The Dutch authorities do not agree with White & Case’s
argument that towage operations must be provided at
sea in order to qualify for the tax facility or with the
findings of the PWC study on the extent of the tax
facility. The Netherlands commented that
is very
common for different kinds of services, such as sea and
port towage, to be managed by different companies. It
also commented
to four
assignments a day, sometimes in the harbour sometimes
at sea, so they will never fulfil a criterion of (cid:145)mainly at
sea(cid:146).

tugs have

three

that

it

(58)

The Netherlands further submitted a report from JBR
focusing mainly on the market situation and stating that
the access of Kotug to the German towage market is
essentially due to its strategy and experience. After the
entry of Dutch firms into the German towage market
prices went down and quality went up. Furthermore, it
is argued that the German companies underestimated
the effects of competition and were too slow to react.

(59) According to a second report

from Loyens & Loeff,
submitted by the Netherlands, the PWC report sent by
the German government
is not based on the right
assumptions nor on the local market situation.

5. ASSESSMENT OF THE AID

4. DUTCH COMMENTS ON THE COMMENTS FROM

THE 51 OTHER INTERESTED PARTIES

5.1. Existence of aid under Article 87(1) of the EC

Treaty

(55)

By letter of 18 April 2002, the Netherlands provided
comments which can be summarised as follows:

(56)

The Dutch authorities argue that the aid has made only
a small contribution to the success of Dutch towage
operations in German ports. The measure is at the same
it allows the employment of
time effective in that
Community
of
and
seafarers
Community shipping companies. Other Community tug
operators can also benefit from fiscal aid to be more
competitive internationally.

strengthening

the

(60) Under Article 87(1) of the EC Treaty (cid:145)any aid granted by
a Member State or through State resources in any form
whatsoever which distorts or
to distort
competition by favouring certain undertakings or the
production of certain goods shall, in so far as it affects
trade between Member States, be incompatible with the
common market(cid:146).

threatens

(61)

The application of subsidies by the Dutch authorities
through State resources in favour of operations by
Dutch tugboats in ports and on inland waterways in the

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since

certain undertakings

Community favours
the
measure is specific to certain towage operations (13).
Subsidies granted in this context
threaten to distort
competition and could affect
trade between Member
States since they can be carried out by companies
registered in a country different from the country where
carried out (14). For
reasons,
the
subsidies granted to port and inland waterway towage
operations constitute State aid within the meaning of
Article 87(1) of the Treaty.

service

these

is

(67)

(68)

5.2. Legal basis for the assessment

(62)

The 1997 Community guidelines on State aid to
maritime transport (15)
(hereinafter referred to as (cid:145)the
guidelines(cid:146)) give details of which aid to maritime
transport may be considered compatible with the
common market.

(63)

Regulation (EC) No 659/1999.

5.3.

(cid:145)Unlawful(cid:146) aid (aid not notified)

The general
and specific details notified by the
Netherlands contain nothing which should have led the
Commission to doubt that the aid would be granted
only to seagoing vessels operating exclusively or at least
predominantly at sea.

in

the

procedure. A phrase

The following relevant information came to light as a
result of the appeal lodged by the Netherlands against
the decision by the Commission to open the Article
88(2)
explanatory
memorandum on the law approved by the Commission
under Case N 384/91, as presented to the Dutch
parliament by the Dutch government, clarified, in order
to avoid misunderstandings,
tugboats which are
suitable and licensed for towing at sea do not actually
need to perform such activities at sea in order to benefit
from the aid. However, this phrase was not contained in
the version of the explanatory memorandum submitted
the
to the Commission.
is
Commission was not properly
the
Netherlands of its plan to provide the aid in such cases
as well.

that
informed by

therefore clear

that

It

(64)

Since the Dutch authorities confirmed that the aid in
question has been granted, it has to be clarified whether
this aid was notified or if it constitutes unlawful aid.

5.3.2. Interpretation in the Netherlands: Government versus

Court

(65)

(66)

5.3.1. Scope of the notification(s)

(69)

In the notification and information provided on Cases
N 738/95 and NN 89/97, the Netherlands notified aid
schemes which focused almost exclusively on activities
carried out at sea. This is clear from analysis of both the
general scope and the different elements of the notified
schemes as summarised above. The sole derogation to
the condition that the operations must be performed at
sea is that a ship which is used both at sea and in ports
or on inland waterways is considered as being used for
activities at sea if the main focus of the activities is at
sea.

738/95

should be added that
entitled
is

the act notified in Case
It
N
enige
belastingwetten in het belang van de zeescheepvaart(cid:146)
(Amendment to certain tax laws relating to seagoing
shipping).

(cid:145)Wijziging

van

(13) Even if considered part of a package such as the (cid:145)tonnage tax(cid:146) or
(cid:145)fiscal facility(cid:146), such a subsidy would still be sector specific since it
affects one particular activity in the seaports sector.

(14) In the particular case under assessment, Dutch towage companies
have been carrying out port towage operations in German ports
(Hamburg and Bremen).
(15) OJ C 205, 5.7.1997, p. 5.

by

the

raised

argument

Concerning
the Dutch
authorities that the notification of Case N 738/95 gave
an indication that tugboats would qualify for the aid in
question on the basis of technical criteria rather than
the
the
Commission notes
the position
officially defended by the Dutch government before the
Dutch courts.

location where activities are

this was not

carried out,

that

the

to the attention of

following
During the Article 88(2) procedure
information was brought
the
Commission. The application of the aid schemes (i.e. the
Dutch laws) approved by the Commission to activities
in ports and on inland waterways was the object of
litigation in the Dutch courts.
the
Dutch authorities took the position that the aid was not
available if
the vessels concerned were not, or were
hardly, used at sea (16). In fact, in one of these cases the
Dutch authorities even appealed to the Dutch Supreme
Court, defending this position. It appears that the Dutch
Supreme Court overruled the government and ruled that
port towage services qualify for the aid (17).

litigation,

In that

(16) Judgment of the Court of Justice in The Hague No 96/0195 of

5 June 1997, Case 23850.

(17) Judgment dated 17 February 1999 by the Supreme Court

(LJN-number: AA2667, Case 33504).

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Official Journal of the European Communities

18.11.2002

(70)

that

shows

foregoing

The
the Dutch authorities
the aid
themselves officially defended the view that
should not be available to the situations covered by this
decision. Moreover,
the
they
Commission of the outcome of the Dutch court cases
and did not even mention them in the course of the
Article 88(2) proceedings.

informed

never

It follows from this that (a) the interpretation of the
relevant Dutch law at national
level was changed
without informing the Commission and (b) the Dutch
government clearly notified aid which it did not
originally
The
include
in the
abovementioned remark (see paragraph 68)
explanatory memorandum on the law, which might
indicate a change of position, was not included in the
text notified to the Commission (18).

towage.

intend

port

to

(71)

Taking the foregoing into account,
the Commission
concludes on this point that it has not been notified by
towage
the Dutch authorities of aid in favour of
operations
and on inland
in and around ports
waterways in the Community and that, therefore, no
such aid has been approved by the Commission.

5.4. Classification as (cid:145)new aid(cid:146)

therefore, be deemed to have been authorised by the
Commission,

(d) the subsidy did not become State aid due to the
evolution of the common market or following the
liberalisation of the sector by Community law.

(74)

(75)

the Commission addressed

It is possible that the aid had already been granted to
tugboats not operating mainly at sea for more than ten
its
years before
first
(letter of 12
questions
September 2000). To that extent in the light of Article
1(b)(iv) of Regulation (EC) No 659/1999 such aid would
have to be considered as existing and non-recoverable
aid.

to the Dutch authorities

The aid granted after 12 September 1990 to tugboats
not operating mainly at sea constitutes (cid:145)new aid(cid:146), as
provided for by Article 1(c) of Regulation (EC) No
659/1999, which covers all aid,
is to say, aid
schemes and individual aid, which is not existing aid,
including alterations to existing aid. In particular, due to
the interpretations provided by the Dutch government
to the Dutch Parliament and/or the rulings by the Dutch
courts, the aid scheme presented to the Commission
was, in practice, altered without the Commission being
informed thereof.

that

(72)

It has further to be clarified whether this aid constitutes
(cid:145)existing(cid:146) or (cid:145)new(cid:146) aid within the meaning of Article 1 of
Regulation (EC) No 659/1999.

5.5. Compatibility of the aid

(73)

For the period after 12 September 1990 (see paragraph
74)
the subsidy cannot be classified as (cid:145)existing aid(cid:146)
under Article 1(b) of Regulation (EC) No 659/1999 for
the following reasons:

(a)

the aid was not put into effect prior to the entry
into force of the Treaty,

(76)

The guidelines focus essentially on measures to preserve
and improve the competitiveness of
the Community
shipping industry against non-Community shipping and
competition
keeping distortion of
registers while
between Member States to the minimum.

(b) the aid has not been authorised by the Commission,

5.5.1. Maritime transport

(c)

after

preliminary

the subsidy was not duly notified and was therefore
not,
the
Commission, considered as aid, as compatible aid or
investigation
as having been object of a formal
procedure within the appropriate periods. It cannot,

examination

by

(77)

The guidelines (19), when discussing the philosophy
behind Community policy in the field of sea transport,
refer to Council Regulation (EEC) No 4055/86 (20) and
Council Regulation (EEC) No 3577/92 (21), which define

(18) The ports sector or the (inland) waterway sector are distinct from
the maritime transport sector in that the Community guidelines
on State aid to maritime transport do not apply to them.

(19) Paragraph 1.1, second subparagraph.
(20) OJ L 378, 31.12.1986, p. 4.
(21) OJ L 364, 12.12.1992, p. 7.

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L 314/105

maritime transport services as (cid:145)the carriage of passengers
or goods by sea(cid:146) (22)
(underlining added by the
Commission).

5.5.4. Rules on State aid for port towage and maritime

transport

(80)

The guidelines (cid:145)cover any aid granted by EC Member
States or through State resources in favour of maritime
transport(cid:146).

5.5.2. Deep sea towage

(78) Deep sea towage is usually characterised by the fact that
the tug operator alone is in charge of
the towage
operation, since the object towed (a vessel, an oilrig or
an empty hull) is inert and incapable of influencing the
manoeuvre. Deep-sea towage can thus be considered to
constitute transport of goods (and perhaps of persons)
by sea. It can therefore be argued that deep-sea towage
should qualify as (cid:145)maritime transport(cid:146) activity according
to the Community legislation referred to in the
guidelines.

5.5.3. Port towage

(79)

take place at sea. Moreover,

Port towage clearly does not fall under those definitions
since it does not
the
guidelines are clearly limited to approving aid in order
to improve the competitive position of Community
Member States’ fleets on the global maritime transport
market. State aid to port towage does not fit within that
policy.

(22) Regulation (EEC) No 4055/86, Article 1(4):(cid:145)For the purpose of this
Regulation, the following shall be considered (cid:145)maritime transport
services between Member States and between Member States and
third
for
remuneration:
(a) intra-Community shipping services: the carriage of passengers
or goods by sea between any port of a Member State and any
port or off shore installation of another Member State;

countries’ where

normally

provided

they

are

(b) third country-traffic: the carriage of passengers or goods by sea
between the ports of a Member State and ports or offshore
installations of a third country.(cid:146)

Regulation (EEC) No 3577/92, Article 2:(cid:145)For the purpose of this
Regulation (cid:147)maritime transport services within a Member State
(maritime cabotage)(cid:148) shall mean services normally provided for
remuneration and shall in particular include:
(a) mainland cabotage: the carriage of passengers or goods by sea
between ports situated on the mainland or the main territory
of one and the same Member State without calls at islands;
(b) off-shore supply services: the carriage of passengers or goods
by sea between any port in a Member State and installations of
structures situated on the continental shelf of that Member
State;

(c) island cabotage: the carriage of passengers or goods by sea

between:
(cid:151) ports situated on the mainland and on one or more of the

the

towage activities,

complaint which triggered this
Also because
procedure made the Commission aware that Member
States might grant aid to port
the
Commission has started explicitly to remind Member
States, in individual decisions, that the guidelines do not
in any way provide that State aid to port towage would
be compatible with the common market. In the decision
concerning the United Kingdom’s tonnage tax (Case N
790/99) (23), commercial
services provided to third
parties within the port area, such as towing vessels in
ports, are specifically excluded.

regards

In a decision concerning Belgium (Case N 142/00) (24)
the application of a fiscal facility was assessed, inter alia
the
as
towage.
Commission approved the fiscal
towage
activities at sea but excluded application of the fiscal
facility to port towage.

facility for

decision

same

this

In

(81)

in the Community

Taking account of
the above analysis leading to the
conclusion that
tugboat operations in ports and on
cannot be
inland waterways
considered as maritime transport within the meaning of
Regulation (EEC) No 4055/86 and Regulation (EEC) No
3577/92 and taking account of
the abovementioned
Commission decisions, the Commission concludes that
maritime transport State aid cannot be approved for
towage services in ports and on inland waterways in the
Community.

5.5.5. Incompatibility with other provisions in the Treaty

(82)

It must also be assessed whether maritime transport aid
to tugboat operations in ports and on inland waterways
in the Community is
compatible with the other
provisions in the Treaty.

(83) While the aid falls under Article 87(1) of the Treaty, it
must also be examined whether the measure comes
under consideration for derogation or exception under
Articles 87(2), 87(3) and 86(2) of the Treaty.

(84)

The aid in question cannot be considered under Article
87(2) of the Treaty as it is not aid of a social character

islands of one and the same Member State,

(23) Letter to the United Kingdom of 2 August 2000 (No SG(2000)

(cid:151) ports situated on the islands of one and the same Member

D/105768).

State.(cid:146)

(24) Letter to Belgium of 27 July 2000 (No SG(2000) D/105460).

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granted to individual consumers, nor was it put in place
to alleviate the damage caused by a natural disaster or
granted to compensate for the effects of the division of
Germany.

(85) However, Article 87(3)(a) may exempt aid which
promotes the development of areas where the standard
of living is abnormally low or where there is serious
underemployment. The aid in question was, however,
not granted under an aid scheme designed primarily to
promote regional development. In any case, even if it
had been, Article 87(3)(a) does not exempt an aid
scheme which, like the one in question, is not in line
with Community guidelines on aid to specific sensitive
sectors such as maritime transport.

the aid at

(86) With regard to the possibility of derogation under
Article 87(3)(b),
intended to
promote the execution of an important project of
common interest nor to remedy a serious disturbance in
the Dutch economy, nor does it have any of
the
features of such projects.

issue is not

(87) As to the possibility of derogation under Article 87(3)(c)
relating to aid to facilitate the development of certain
economic activities,
it is found that operating aid for
towage services in ports and on inland waterways in the
Community could adversely affect trading conditions to
an extent contrary to the common interest and that no
specific Community provisions allow the subsidies to be
granted. In particular, the situation which gave rise to
this decision shows
to
undesirable effects on competition between undertakings
in the Member States without being adequately justified
by competition from vessels
from non-Community
States.

the aid clearly leads

that

(88)

Furthermore, Article 86(2) of
the Treaty would not
apply to the case in point since the aid is part of a
scheme for a particular industry operating, inter alia, in
another Member State and does not appear to be a
service
the
economic
Netherlands has not invoked Article 86(2).

interest. Also,

general

of

(90)

(91)

(92)

the Dutch authorities have invoked no such

that
derogations in their contacts with the Commission.

The Commission has also investigated, on the basis of
Article 14(1) of Regulation (EC) No 659/1999, whether
general principles of Community law would warrant
non-recovery of the aid. In this context, it has noted in
particular that the undertakings which have benefited
from the aid when performing towage activities in
German ports, were most likely aware of the fact that
the Dutch authorities had defended up to the Dutch
Supreme Court the view that the aid schemes approved
by the Commission were not intended to cover such
activities. In any case, they could have been aware of
this fact since such information is publicly available.
Moreover, they should have been aware of the fact that
the guidelines concern sea transport.

6. CONCLUSION

that

the measures

The Commission concludes
in
question constitute State aid within the meaning of
Article 87(1) of the Treaty and that the aid is unlawful
since this (cid:145)new aid(cid:146) has been put into effect without
having been notified in accordance with Article 88(3) of
the Treaty.

that

finds

The Commission further
the maritime
transport State aid granted by the Netherlands in favour
of operations by Dutch tugboats
in and around
Community ports and on Community inland waterways
is not
in conformity with the guidelines and is
incompatible with Article 87 of the EC Treaty.

(93) As a result of its incompatibility with the Treaty and in
accordance with Article 14 of Regulation (EC) No
659/1999 the unlawful aid granted by the Netherlands
in favour of operations by Dutch tugboats in and
around Community ports and on Community inland
waterways must be recovered,

HAS ADOPTED THIS DECISION:

Article 1

(89)

The Commission therefore considers that the aid under
examination does not meet any of
the requirements
related to the abovementioned derogations and notes

Application by the Netherlands of
facility(cid:146) and
(cid:145)tonnage tax(cid:146) to Dutch tugboat operations carried out mainly
in and around Community ports and on Community inland
waterways, which are not carried out mainly at
is
incompatible with the common market.

the (cid:145)fiscal

sea,

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L 314/107

Article 2

Article 4

The Netherlands shall withdraw the relevant elements of the
scheme referred to in Article 1.

Article 3

The Netherlands shall

1.
take all necessary measures to
recover from the beneficiaries the aid referred to in Article 1
and unlawfully made available to the beneficiaries. Aid granted
before 12 September 1990 shall not be recovered.

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

Article 5

This Decision is addressed to The Kingdom of the Netherlands.

Recovery

shall be

effected without delay

2.
and in
accordance with the procedures of national law, provided that
they allow immediate and effective execution of the decision.
The aid to be recovered shall include interest from the date on
which it was placed at the disposal of the beneficiaries 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.

Done at Brussels, 19 June 2002.

For the Commission

Loyola DE PALACIO

Vice-President