WRITTEN QUESTION P-0089/03 by Regina Bastos (PPE-DE) to the Commission. Closure of the C. & J. Clark footwear factory in Castelo de Paiva (Portugal).
Date: 2003-01-17
Institutions: European Parliament, Provisional data
Subjects: EU financing, EU policy, Portugal, aid system, aid to undertakings, cessation of trading, footwear industry, terms for aid

15.1.2004

EN

Official Journal of the European Union

C 11 E/67

(2004/C 11 E/070)

WRITTEN QUESTION P-0089/03

by Regina Bastos (PPE-DE) to the Commission

(17 January 2003)

Subject: Closure of the C. & J. Clark footwear factory in Castelo de Paiva (Portugal)

On 10 January 2003 the multinational company ‘C. & J. Clark (cid:1) Fábrica de Calçado, Lda’, a maker of
footwear located in Castelo de Paiva (Portugal), announced the closure of its factory, thus making 588
workers redundant.

The decision to close this factory is justified by the company itself on grounds relating to ‘imports of
vamps from India and Romania’ and ‘the objective of maintaining a competitive price structure’ (cf. press
release issued by the Clark management on 10 January 2003).

Clark set up operations in Castelo de Paiva in 1988, with both national and Community aid. In May 2000
in which it undertook to continue
the company signed a protocol with the local municipal council
operations up to at least 2007, in return for a significant level of investment from the municipality.
Castelo de Paiva is a municipality located in the Portuguese interior, with a very fragile economy. The
closure of this undertaking will bring in its wake disastrous economic and social consequences.

Given that this decision to close runs totally counter to the notion of corporate social responsibility, can
the Commission answer the following questions:

(cid:1) What sums were granted from Community funds, and when, to the company ‘Clark (cid:1) Fábrica de

Calçado, Lda’ in Castelo de Paiva?

(cid:1) What conditions were required from this company in relation to the above Community funding?

(cid:1) Should it be established that Clark is in breach of its obligations regarding its receipt of Community
support, what action will the Commission take to prevent the factory’s closure and ensure the
continuation of its activities in Castelo Paiva, guaranteeing the workers’ jobs?

(cid:1) What political measures will the Commission take in order to prevent, and, ultimately, penalise actions
of this nature, as frequently perpetrated by companies which establish themselves in the EU, receive
Community funding and then, having exhausted its advantages and benefits (above all on the human
level), relocate their operations?

Answer given by Mrs Diamantopoulou on behalf of the Commission

(24 February 2003)

The Commission would like to provide the Honourable Member with the following information. The
company ‘C. & J. Clark (cid:1) Fábrica de Calçado, Lda.’ has received the following support:

1.

Old Funds (1986-1989)

(In euro (cid:1) converted from PTE at the rate of 200,482)

Dossiers

890098 P1

890101 P1

Total

(1) Orçamento da Segurança Social.

ESF

172 784

61 453

234 237

OSS (1)

141 369

50 280

191 648

These amounts were used to co-finance vocation training activities in 1989.

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2.

Community Support Framework (CSF) II (1994-1999)

The company received support from PEDIP II (Programa especifico para o Desenvolvimento Industrial
Português), which was cofinanced by the European Regional Development Fund (ERDF) and the European
Social Fund (ESF), under measure 3.1. ‘Diagnósticos e Auditorias Empresariais’ and measure 4.6. ‘Acção A
(cid:1) Acções de Demonstração Empresarial’.

The aim of these projects was modernisation, in the first case through diagnosis and study and in the
second case through more flexible production and the associated vocational training.

The amounts approved came to EUR 680 372, and the following amounts were paid out:

(In euro (cid:1) converted from PTE at the rate of 200,482)

ERDF

OE

ESF

OSS

328 335

109 445

124 402

41 467

603 649

Total payments

As regards ESF, OE and OSS support, the investment took place between 1995 and 1998, and 860

3.
persons benefited from training. The projects financed did not involve any changes in terms of jobs.

The granting of ESF assistance for vocational training is not subject to conditions in terms of the continued
existence of recipient companies, but requires compliance with the access and eligibility conditions laid
down in the regulations on the granting of ESF assistance in force at the time.

The Commission feels that any investment in human resources is of the greatest importance at national
and regional levels. It must be underlined that ESF funding does not support a company as such, but
provides an investment in human capital and improves the employability of individual workers.

As far as the Commission is aware, the company in question has not contravened the rules on Structural
Fund assistance.

4.
ERDF support was granted by the Member State under an approved State aid scheme. The State must
therefore monitor compliance with Community competition rules, more specifically the current ‘Guidelines
on national regional aid’ (1), which were adopted by the Commission in March 1998 and require the assets
financed and the jobs created to be maintained in the establishment for at least five years from the date of
the investment for which aid was granted. The Commission will ask the Portuguese authorities to ensure
compliance with these rules in the case of the aid granted to the company ‘C. & J. Clark’.

The Commission would like also to point out that Directive 98/59/EC (2) concerning collective
5.
redundancies provides for information and consultation with the workers’ representatives in cases where
the employer is contemplating such redundancies. These consultations should be carried out in good time
with a view to reaching agreement and should at least cover ways and means of avoiding collective
redundancies or reducing the number of workers affected as well as of mitigating the consequences by
recourse to accompanying social measures. These measures aim, among other things, at providing aid for
redeploying or retraining workers made redundant.

More generally, the Commission advocates the idea that, when deciding on their relocation, enterprises
should always take into account the effects that those decisions could have on their employees as well as
on the social and regional context. This has recently been underlined in the Commission’s Communication
concerning corporate social responsibility (CSR) (cid:1) A business contribution to sustainable development (3).

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Furthermore, the Commission invited the European social partners to engage in a dialogue on anticipating
and managing change with a view to applying a dynamic approach to the social aspects of corporate
restructuring. The social partners agreed to incorporate this important issue in their recently adopted
multiannual work programme (4) (5).

(1) OJ C 74, 10.3.1998.
(2) Directive 98/59/EC of 20 July 1998 on the approximation of the laws of the Member States relating to collective

redundancies, OJ L 225, 12.8.1998.

(3) COM(2002) 347 final.
(4) Orçamento da Economia
(5) European Social Fund.

(2004/C 11 E/071)

WRITTEN QUESTION E-0114/03

by Ralf Walter (PSE) to the Commission

(28 January 2003)

Subject: Insurance against natural disasters

Can the Commission indicate what different insurance systems and other types of financial safeguards,
provided by the insurance industry and by states, exist in EU Member States, with regard to natural
disasters, including:

(cid:1) earthquakes,

(cid:1) landslides,

(cid:1) avalanches,

(cid:1) floods, and

(cid:1) storm tides?

Answer given by Mr Bolkestein on behalf of the Commission

(4 March 2003)

Natural disasters are infrequent, erratic and violent phenomena that are exceptionally costly. They occur at
random in various parts of a country but the costs involved are very high as the damage is as a rule
confined to a specific area (city, region, etc.).

Member States are exposed to the risk of natural disasters in differing degrees, some being more vulnerable
than others, on account of location, population spread, etc., to certain types of natural disaster (floods,
earthquakes, avalanches, tidal waves, storms, etc.), which also vary considerably in terms of frequency and
intensity.

Given these differences between the Member States, systems to protect against natural disasters can be put
in place more satisfactorily at regional or national
level than at Community level. As laid down in
Regulation (EC) No 2012/2002 (1), Community aid should be complementary to that of the Member States
and, under the subsidiarity principle, should be confined to major disasters.

Different insurance systems are used to protect against natural disasters in the Member States. Most have
arrangements for providing compensation for damage caused by natural disasters. These vary depending
on the type of disaster involved: floods, avalanches, earthquakes, storms, etc. The solutions existing in each
of the Member States also depend on the exposure of the Member State to the risk of natural disasters,
which sometimes makes certain categories of risk uninsurable or technically very difficult to insure.