WRITTEN QUESTION E-1381/03 by Giles Chichester (PPE-DE) to the Commission. Swedish state aid to municipal housing companies.
Date: 2003-04-15
Institutions: European Parliament, Provisional data
Subjects: EU aid, Sweden, complaint to the Commission, local government, private sector, property market, real estate business, rent regulations, restriction on competition, urban renewal

6.3.2004

EN

Official Journal of the European Union

C 58 E/63

The research required to provide a more detailed answer to the Honourable Member’s question, addressing
the specific points raised in respect of each building, would be out of all proportion to the result obtained
and would be inappropriate in the context of answering a written question. Nevertheless, some of the
requested detailed information on buildings & information on the Commission’s building standard,
‘Immeuble Type’, is being sent direct to the Honourable Member to supplement the above response.

(2004/C 58 E/081)

WRITTEN QUESTION E-1381/03

by Giles Chichester (PPE-DE) to the Commission

(15 April 2003)

Subject: Swedish state aid to municipal housing companies

The development of cross-border property investment is one of the recent great breakthroughs of the
internal market, reaching EUR 25 billion in just a few years. This in turn is leading to the emergence of a
European property industry whose increasingly sophisticated services provide important underpinning for
the European economy. It is the duty of the Commission to ensure that State aid is not allowed to distort
competition in the property sector.

Last year, the Swedish government granted an initial EUR 300 million in subsidies to municipal housing
companies (MHCs). This included purchasing non-viable housing from MHCs for conversion to other uses
and providing MHCs with equity capital and loan guarantees. The distortion of competition ensues from
the fact that MHCs are not providers of social housing; they compete with private housing companies for
the same tenants. The distortion is magnified by the fact that the Swedish ‘utility value system’ obliges local
judges to set the rent of private landlords at the same rate as that of comparable MHCs. The State aid
therefore enables MHCs to bankrupt genuinely private housing companies by setting rents at levels that
their private competitors cannot match.

The distortion is particularly relevant to the substantial and increasing European property investment in
Sweden, because all of it is, by definition, private.

Following a complaint by the European Property Federation, the Commission launched an investigation
last summer (CP 115/02 (cid:1) Financial Support Granted to Swedish Municipal Housing Companies) and the
Swedish government responded.

1.

Did the Commission respond to the Swedish government’s letter of 16 October 2002 and if so, how?

2. What is the current state of the Commission’s investigations concerning this matter?

3. When does the Commission expect to conclude?

Answer given by Mr Monti on behalf of the Commission

(15 May 2003)

The information provided by the Swedish Government in their letter of 16 October 2002 is still

1.
being assessed; a formal response to the letter in question has thus not been made.

C 58 E/64

Official Journal of the European Union

EN

6.3.2004

The Commission is investigating the various issues raised by the original complaint. Additionally, on
2.
21 January 2003 the Commission has received a formal notification from the Swedish Government of
proposed state measures also concerning the housing market in Sweden. To ensure a consistent and
coherent approach in the assessment of the two cases in question the Commission is now investigating
them in parallel; to enable the Commission to move forward on this basis it has requested additional
information from the Swedish Government concerning the notification.

The Commission has not arrived at a definitive conclusion yet. It expects to do it after it will have

3.
received all the information necessary for a final decision.

(2004/C 58 E/082)

WRITTEN QUESTION E-1387/03

by Roberta Angelilli (UEN) to the Commission

(15 April 2003)

Subject: Possibility of funding zootechnology projects in eastern Europe

The Italian company Nuova Cizo s.r.l. has been operating for some years in the zootechnology sector on
the planning, construction, installation and marketing of metal structures, automatic equipment, fodder
storage silos and various kinds of plant engineering.

The company has developed extensive technical capacity for innovation and is increasingly asked to
undertake comprehensive projects entailing supply of breeding structures, automatic facilities and the
relevant technological plant, including a project for producing organic chickens that is unique in Europe.

It is currently developing two innovative projects for closed-cycle poultry breeding, covering all phases of
production from egg to adult bird, including processing, meat-packing and distribution of the finished
product on local markets.

These projects are attracting the interest of some eastern European countries soon to join the European
Union, as well as others, including Albania in particular, which could enter into cooperation with a view
to developing similar production cycles in their own countries.

In the light of the above, will the Commission say:

1. whether EU funds are available to finance projects of the kind described above in the countries of

eastern Europe?

2. what procedures would the company Nuova Cizo and its partners have to follow to obtain such

funding?

Answer given on behalf of the Commission by Franz Fischler

(3 June 2003)

1.
Regarding agriculture and rural development, the acceding countries of central and eastern Europe
benefit from the pre-accession Sapard programme set up under Council Regulation 1268/1999 of 21 June
1999 (1).

The way it works: the countries each draw up a programme to be approved by the Commission, then see
to its implementation subject to a Commission decision empowering them to so do. The measures eligible
for co-financing include investments in agricultural holdings and in the processing and marketing of
agricultural products. The public contribution may not exceed 50 % of the total, while Community
expenditure may not exceed 75 % of the public aid.