2004/167/EC: Commission Decision of 17 September 2003 on the State aid implemented by Germany for Space Park Development GmbH & Co., KG (notified under document number C(2003) 3241) (Text with EEA relevance)
Date: 2003-09-17
Institutions: European Commission
Subjects: Germany, State aid, control of State aid, leisure park

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Official Journal of the European Union

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COMMISSION DECISION

of 17 September 2003

on the State aid implemented by Germany for Space Park Development GmbH & Co., KG

(notified under document number C(2003) 3241)

(Only the German text is authentic)

(Text with EEA relevance)

(2004/167/EC)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

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 called on interested parties to submit their comments
pursuant to the provision cited above (1),

Whereas:

I. PROCEDURE

(4)

(5)

(6)

letters

in Bremen which was

Between 14 June 1999 and 19 September 2001, the
Commission received
from several
several
complainants concerning the construction of a leisure
park
receiving
allegedly
in particular from the Bremen
considerable State aid,
regional administration, contrary to the provisions of
the EC Treaty. By letter of 26 October 2001,
the
Commission sent the German authorities a request for
information, seeking clarification on the complainants'
allegations, to which the German authorities replied by
letters of 31 January and 1 February 2002, in a meeting
on 6 June 2002 and by letter of 20 June 2002. The case
was registered under NN 78/2002.

by SWG Grundstücks GmbH & Co. KG to Space Park
Development GmbH & Co. KG involve elements of
incompatible State aid within the meaning of Article
87(1) of the EC Treaty. As regards the complainants'
remaining allegations, the Commission concluded that
there was no State aid or no reason to investigate
further at that stage.

The Commission decision to initiate the procedure was
published in the Official
the European
Communities (2). The Commission invited interested
parties to submit comments in that respect.

Journal

of

The Commission has
interested parties.

received no comments

from

to Article 10(3)

Comments presented by Germany were received on 12
September 2002, 27 January 2003 and 16 April 2003.
On 8 May 2003, the Commission decided to enjoin
Germany pursuant
of Council
Regulation (EC) No 659/1999 of 22 March 1999 laying
down detailed rules for the application of Article 93 of
the EC Treaty (3)
to supply all such documentation,
information and data as are necessary to assess the
compatibility of
the measure in question. Additional
information presented by Germany by letter of 16 June
2003 was received on 17 June 2003.

II. DESCRIPTION OF THE PROJECT AND THE
MEASURES AT STAKE

By letter dated 2 August 2002,
the Commission
informed Germany that it had decided to initiate the
procedure laid down in Article 88(2) of the EC Treaty in
respect of part of the measures. As of then the case was
registered as C 53/2002.

(a) The Space Park Bremen Project

investigation
In its decision to initiate the formal
the Commission could not
procedure (the opening),
exclude
injection of Bremen to
Köllmann AG and the partly interest-free loan granted

capital

that

the

(7)

Space Park Bremen is an investment project of about
EUR 500 million on an area of 26 ha, including several
in
activities in the leisure and entertainment sector,

(1) OJ C 246, 12.10.2002, p. 14.

(2) See footnote 1.
(3) OJ L 83, 27.3.1999, p. 1.

(1)

(2)

(3)

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particular a leisure-park-type ‘Space Centre', restaurants,
a multiplex-cinema and a discotheque, a hotel and a
shopping centre (retail). The park is under construction
since end 2000. The opening of the park was envisaged
for spring 2003, but the date was postponed because of
unexpected delays. The park area is situated on a
derelict shipyard in the Gröpelingen district of Bremen,
where
are being
developed.

also two other

industrial

areas

(8)

(9)

(10)

DEGI

The Space Park project was initiated by Köllmann AG, a
company active in international real estate development.
für
Deutsche
Bremen,
Immobilienfonds mbH, a subsidiary of
the Dresdner
Bank Group, and KanAM Euro Malls GmbH are the
investors of the project. DEGI and KanAM are both
active in international
real estate development and
invest in shopping and urban entertainment centres.

Gesellschaft

(b) The measures at stake

Bremen intended to purchase 2,96 million shares of
Köllmann AG at a price of EUR 2,55 plus a premium of
EUR 1,75/share. This represented a proportion of 7,98 %
of the increased capital of Köllmann AG. The total price
would have been EUR 12,782 million.
In exchange,
Bremen would have sent one of the six members of the
board and participated at the distribution of 50 % of the
profit of Köllmann AG. Germany claimed that KanAm
would participate at the same conditions as Bremen in
this operation. In exchange, Köllmann AG would have
invested in the Space Park project.

The complainants claimed that Bremen had granted an
interest-free loan to finance the Space Park project.
According to the information provided by the German
authorities before
the opening, SWG Grundstücks
GmbH & Co. KG (hereafter referred to as SWG) granted
by contract of 18 January 1999 to a precursor company
of Space Park KG a loan of DEM 26 million (EUR 13
million), which was disbursed on 23 February 1999. On
15 April 1999, an unrelated company, Space Park
Development GmbH & Co. KG replaced the former
debtor. This loan was at least a partly interest-free loan.

III. COMMENTS PRESENTED BY GERMANY

investigation procedure Germany
(11) During the formal
supplied additional
information on the measure as
regards the participation of Bremen in Köllmann AG
and the grant of the partly interest-free loan by SWG to
Space Park Development GmbH & Co., KG.

(a) The intended participation of Bremen in Köllmann AG

(12) With respect to the intended participation of Bremen in
Köllmann AG,
the German authorities informed the
Commission that the former investor Köllmann would
be replaced and that
therefore no participation of
Bremen in Köllmann AG will take place. They further
informed the Commission that, for the time being, no
is,
measure had been adopted by Germany — that
regardless of whether or not
the envisaged measure
would or would not involve State aid, no grant has yet
taken place.

(b) The partly interest-free loan

(13)

Following the information submitted by the German
authorities, Space Park Development GmbH & Co., KG,
company that was owned and
a private project
established by Köllmann AG for the purpose of
the
Space Park project, replaced, as from 15 April 1999,
Space Park KG as borrower of the loan of DEM 26
million (EUR 13 million) granted by SWG. The former
borrower Space Park KG was dispensed from all rights
and obligations of the loan agreement. The loan was
split into two tranches (hereafter: loan I and loan II) and
had, besides a handling fee of DEM 25 000 and after
some modifications on 5 July 1999 and 20 September
1999, the following conditions:

(1) conditions for loan I

Amount:

million DEM 1,47

Interests:

3,8 % p.a. from 15.4.1999 to 30.6.1999

4,73 % p.a. from 1.7.1999 to 31.12.1999

Duration:

Until 31.12.1999

Securities:

(1) Group guarantee from Köllmann AG

(2) Directly enforceable guarantee from Space

Park KG

(3) Land charge given by Köllmann AG

(2) conditions for loan II

Amount:

million DEM 24,53

Interests:

no interests from 15.4.1999 to 31.12.1999

4,73 % p.a. from 1.1.2000 to 31.3.2000

Duration:

Until 31.3.2000

Securities:

See above

(14) However, according to the information available, there
is no indication for neither the payment of interests nor

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the loans on due date. On the
the repayment of
contrary, according to the information available the
Commission has to conclude that no interests had been
paid and that
the loans have still not yet been
reimbursed. The Commission therefore considers that
the loans have been prolonged for an open-ended
period of time as from 1 January 2000 and as from
1 April 2000 and not yet been repaid.

IV. ASSESSMENT OF THE MEASURES

1. Measures under scrutiny

(15)

In their letter of 16 April 2003, the German authorities
argued that the loan did not involve State aid in the
meaning of Article 87(1) EC as its granting was not
imputable to the State since it had been granted by
SWG and not directly by the State. SWG was claimed to
be an independently acting public undertaking without
being under constant State control. In this context the
German authorities referred to the so-called Stardust
ruling (4) and stated that following the case-law of the
ECJ, Article 87(1) EC presupposes that when the granted
sums ‘constantly remain under public control, and [are]
therefore available to the competent national authorities,
for them to be categorised as State
[it] is sufficient
resources' (5). The German authorities continue to refer
to the Stardust ruling, in particular to points 55 and 57,
and argued that even if SWG would be under constant
public control, the mere fact that a public undertaking
for measures
is under State control
taken by that undertaking to be imputed to the State
and that a specific analysis has to be made by the
Commission in each particular case.

is not sufficient

(16) Despite this argument, Germany offered in previous
letters to demand retroactively the borrower to pay the
applicable reference rate as interest. This was finally
accepted by the borrower, Space Park Development
GmbH & Co., KG, by letter dated 13 June 2003 and
confirmed by the German authorities by letter of 16 June
2003. The German authorities claimed therefore that
since the loan was backed by guarantees and further
securities, the loan would not have to be regarded as
State aid in the meaning of Article 87(1) of the EC
Treaty.

(17)

the

that

granted

belonged

to Space

loan was

Finally, the German authorities argued that in any case,
Park
although the
Development GmbH & Co., KG, it should be taken into
account
the
enterprise
Köllmann-Group and therefore its situation should be
seen in the context of
situation of
Köllmann AG, which was one of the leading German
project development companies at the time the loan was
granted. The current financial difficulties of Köllmann
AG could not be relevant to the issue since they were
not predictable neither at the time the loan was granted
nor at the time it was prolonged.

the financial

to

(4) Case C-482/99, France v. Commission (Stardust Marine), [2002]

ECR I-04397.

(5) Case C-482/99 (Stardust Marine), referred to above, point 37.

(a) The intended participation of Bremen in Köllmann AG

(18) As regards the participation of Bremen in Köllmann AG
the Commission notes that no participation has to-date
taken place. Therefore, the participation of Bremen in
Köllmann AG has not to be assessed in this decision.
The measure is without object. Any future participation
in that or any other company will need to be examined
on its own merits.

(b) The loan granted to Space Park KG

(19) On 18 January 1999, SWG granted a loan of DEM 26
million (EUR 13 million) to Space Park KG at an interest
rate of 3,8 %. The duration of the loan was limited to
15 April 1999. Any potential aid arising from the loan
to Space Park KG would not exceed the de minimis —
threshold of EUR 100 000 over a period of three years.
This is why the opening did not have to involve a
potential aid given to Space Park KG.

(c) The loan granted to Space Park Development GmbH &

Co. KG

(20) On 15 April 1999, Space Park Development GmbH &
Co. KG replaced the former debtor Space Park KG and
thus became borrower of the loan of DEM 26 million
(EUR 13 million) granted by SWG. As a result of the
above, only this measure has to be assessed into detail.

2. Presence of State aid in the meaning
of Article 87(1) of the EC Treaty

(21)

(22)

In order to appraise the measure under the State aid
rules of the EC Treaty it has to be assessed whether it
constitutes State aid within the meaning of Article 87(1)
of the EC Treaty.

By virtue of Article 87(1) of the EC Treaty, any aid
granted by a Member State or through State resources
in any form whatsoever, which distorts or threatens to
distort competition by favouring certain undertakings or
in so far as it
the production of certain goods, shall,
affects trade between Member States, be incompatible
with the common market. The concept of State aid
applies to any advantage granted directly or indirectly,
financed out of State resources, granted by the State
itself or by an intermediary body acting by virtue of

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it meets four criteria:

powers conferred on it. A measure is thus deemed to be
State aid if
it confers an
advantage; (b) this advantage is conferred by means of
State funding; (c) the measure distorts or threatens to
thereby affecting trade between
distort competition,
the measure concerned is
Member States; and (d)
selective, favouring particular companies.

(a)

(26)

concerns

Park
the
The measure
Development GmbH & Co. KG, at the time the loan was
granted a wholly-owned subsidiary of Köllmann AG.
The measure is therefore selective.

company Space

(27)

The question is whether this advantage is conferred by
means of State resources and if so imputable to the
State.

(23)

in
The Commission must therefore analyse the loan,
respect of which it initiated the procedure provided for
in Article 88(2) of the EC Treaty, in the light of the four
criteria referred to in the foregoing recital.

(24)

The measure confers an advantage to the borrower as
the interest of
than the
reference rate used by the Commission (6).

the loan is clearly lower

(28)

(25)

The Commission considers that any State aid granted for
the development of a leisure park would be liable to
distort or threaten to distort competition and thereby
affect trade between Member States since:

(a)

large amusement parks, such as the one in question,
constitute
least
potentially, affect tourist flows;

parks which,

destination

at

(b) such parks increase tourism facilities in the regions

where they are set up;

(c)

the Commission has adopted several decisions on
State aid for amusement parks (Eurodisney (7), Parco
Navi (8), Terra Mítica Park (Benidorm, Alicante) (9)),
etc.,) as well as investments in tourism (hotels (10),
marinas (11), etc.).

Irrespective of the other activities of Space Park Bremen
(cinema, shopping centre, etc.,) the measure is therefore
liable to distort or threaten to distort competition and
thereby affect trade between Member States. In addition,
to Köllmann AG
the measure also indirectly benefit
which is an international
estate development
company. For this reason, it therefore also affects trade
between Member States.

real

(6) See Commission notice on the method for setting the reference and
discount rates (OJ C 273, 9.9.1997, p. 3) and the reference rates
applicable
(see
http://europa.eu.int/comm/competition/state_aid/others/
reference_rates.html).

from 1 August

for Germany

1997

as

(a) Presence of State resources and imputability to the State

argued against

the presence of State
the measure at

the
The German authorities have
presence of State resources and the imputability of the
granting of the loan to the State since the loan was
granted by SWG, a public undertaking, and not directly
by the Bremen authorities. The Commission doubts
in the
the rules developed by the Court
whether
so-called Stardust ruling (12) can be applied in this case
rather than the rules developed in the so-called Air
France ruling (13), which seems to be much closer to the
situation at stake. But even if the principles developed
the Commission
in the Stardust ruling would apply,
resources and the
assumes
stake to the State.
imputability of
Following the Stardust ruling,
the imputability of a
measure to the State although taken by a public
undertaking may be inferred from a set of indicators
arising from the circumstances of
the case and the
context in which that measure was taken (14). In this
context, Advocate General Jacobs stated that because of
the difficulties of proof and the obvious danger of
circumvention, a restrictive view should not be taken of
the type of evidence to be adduced. Circumstantial
evidence (perhaps even press reports) might be relied
upon (15). Since the German authorities did not supply
all
as
necessary to assess this question although requested in
the information injunction,
the Commission has to
assess
issue based on the information in its
this
possession.

information and data

such documentation,

(29) As regards the ownership of SWG,

seems

the information
to be
submitted by the German authorities
contradictory. By letter of 20 June 2002, during the
Commission's preliminary assessment of the case, the
German authorities stated with respect to potential aid
elements in the context of the sale of land by the Land
of Bremen that SWG is a company owned by the City
of Bremen. This statement was taken for granted in the
opening, where the Commission concluded that the sale

(7) State aid N 640/99 France (OJ C 284, 7.10.2000, p. 4).
(8) State aid N 132/99 Italy (OJ C 162, 10.6.2000, p. 23).
(9) State aid C 42/2001 (ex NN 14/01) Spain (OJ C 300, 26.10.2001,

p. 2).

(10) State aid N 785/99 Italy (OJ C 328, 18.11.2000, p. 32).
(11) State aid N 582/99 Italy (OJ C 40, 12.2.2000, p. 2).

(12) Case C-482/99 (Stardust Marine), referred to above.
(13) See

case T-358/94 (Compagnie

nationale Air

France

v.

Commission), [1996] ECR II-2109, in particular points 55 to 61.

(14) Case C-482/99 (Stardust Marine), referred to above, point 55.
(15) See Opinion of Advocate General

Jacobs in case C-482/1999

(Stardust Marine), referred to above, point 67.

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the

the

and

GmbH

Wirtschaftsförderung

of land by SWG did not involve State aid. By letter of
16 April 2003, the German authorities stated that SWG
is a real estate company pursuant to private law which
is owned by Bremer Investitions-Gesellschaft mbH and
not integrated into the public administration of the City
of Bremen, which is alleged not to be a shareholder of
SWG. However, following the information available (16),
the Bremer Investitions-Gesellschaft mbH is the central
service provider for regional and business development
in the Land Bremen and concentrates, in particular in
subsidiaries, namely the WfG
conjunction with its
Bremer
GmbH,
Bremer
Aufbau-Bank
Bremer
BIA
Innovations-Agentur GmbH,
the responsibility for all
kind of economic incentive activities in Bremen, i.e. in
the administration of aid schemes. The
particular
responsibility for
aid
administration of
schemes was transferred in a contract governed by
public law (öffentlich-rechtlicher Vertrag) by the Land
Bremen to Bremer Investitions-Gesellschaft mbH on the
basis of
the so-called Beleihungsgesetz (Gesetz zur
Übertragung von Aufgaben staatlicher Förderung auf
juristische Personen des privaten Rechts vom 26. Mai
1998) (17). Following its business reports 2000 and
2001 (18), the company capital (Eigenkapital) of Bremer
Investitions-Gesellschaft mbH, which amounts to EUR
92 million,
is held by the Land Bremen (EUR 86,2
million), by the City of Bremen (EUR 4,464 million) and
by the City of Bremerhaven (EUR 0,736 million). The
Bremen Senator for Economic Affairs is the chairman of
the supervisory board.
the
the subsidiary of
Commission concludes that SWG,
Bremer-Investitions-Gesellschaft mbH,
indirectly
owned by Bremen and therefore considers that SWG is
a public undertaking. Funds belonging to SWG are
therefore State resources.

In view of

the above,

these

is

(30) Although requested

in the

information
explicitly
injunction, the German authorities did not submit any
decision, contract, agreement,
law or other document
Investitions-Gesellschaft
that Bremer
demonstrating
mbH and/or SWG did not act — openly or covertly,
regularly or on an ad hoc basis in the present case — as
a relay or vehicle which the Bremen authorities used to
intervene in support of Space Park Development GmbH
& Co. KG. However, following the Commission's own
investigations,
the Bremen
authorities on 10 September 2002 to a parliamentary
question asked in the regional parliament Bremische
(Landtag) assumes the presence of State
Bürgerschaft
resources and the involvement of the Bremen authorities
in the granting of
the loan. The Bremen authorities
answered the parliamentary question as follows (19):

an answer

given by

(16) See http://www.big-bremen.de/.
(17) Brem.GBl. 1998, p. 134 (corrigendum Brem.GB. 1998, p. 171). The
constitutionality of the law in its wording of 17 October 2000
(Brem.GBl. 2000, p. 399) was
confirmed by the Bremen
Constitutional Court in 2002 (see ruling of 15 January 2002 in
case ST 1/01).

(18) The

business
http://www.big-bremen.de/.
(19) See Drucksache 15/1238 of

reports

Bürgerschaft
http://www.bremische-buergerschaft.de/.

(Landtag),

are

published

under

the regional parliament Bremische
under

available

of

of

the

the

funds

circumstances,

‘(…) SWG had refinanced DEM 24,53 million of the
loan with the purchase money paid for the so-called
AG-Weser-area, which economically was entitled to
the Free Hansa City of Bremen (FHB), and DEM 1,47
million
the
loan with
Bremer-Investitions-Gesellschaft mbH (BIG). When
appraising
the
securities, representatives from the Bremen Senator
for Economic Affairs, the Bremen Senator for Finance,
the Bremen Chancellery and BIG decided on 13
the loan
January 1999 to find the granting of
compatible with the board decision of November
1998 in terms of an efficient project realisation. A
consultation of the board of BIG for its own part of
the loan was not necessary, pursuant to the company
agreement.

in particular

request,

SWG initially granted the loan to Space-Park KG. On
behalf of Köllmann AG's
the loan was
transferred by contracts of 15 June 1999 and 5 July
1999 to Space-Park Development GmbH (now: Space
Park Development GmbH & Co. KG). Space Park KG
jointly and severally liable vis-à-vis SWG. In
is still
this context the SWG-loan was split into two parts
amounting to DEM 1,47 million and DEM 24,53
million and the following interests were agreed: As
regards the part amounting to DEM 1,47 million,
interests of 3,8 % p.a. until 30 June 1999 and 4,73 %
p.a. afterwards were calculated. The part amounting
to DEM 24,53 million was granted interest-free until
31 December 1999. As from 1 January 2000 the
interests amounted to 4,73 % p.a. (…).'

The Commission therefore notes that at
least DEM
24,53 million of the funds that refinanced the loan were
economically entitled to the Free Hansa City of Bremen
and therefore have to be regarded as State resources. In
addition to that it is noted that the granting of the
the
whole loan was depending on the approval of
Bremen authorities. Thus the loan has to be regarded as
imputable to the State. Even if a part of the loan was
financed through SWG using its own or BIG's funds,
such fact
in that regard. Following the
case-law for those funds to be categorized as State
resources,
it is sufficient that, as in the present case,
they constantly remain under public control and are
therefore
national
authorities (20).

is irrelevant

competent

available

the

to

(31)

the Commission also notes that

In this context
the
German authorities offered even before and also during
the loan
the opening to modify the conditions of
retroactively. An appropriate letter by SWG addressed to
the recipient was presented by letter of 27 January
2003. The agreement by the recipient, dated 13 June
2003, was presented by letter of 16 June 2003. The
the Bremen
implementation of

the commitment of

(20) See case C-328/99 and C-399/00, Italy and SIM 2 Multimedia SpA
vs. Commission, not yet published, point 33; see also case
C-482/99 (Stardust), referred to above, point 37.

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authorities by SWG can only be explained by the
influence of
the Bremen authorities on SWG in the
context of the loan agreement at stake. The fact that the
Bremen authorities succeeded to agree to modify the
loan agreement
to be
contradictory to the argumentation put forward by the
German authorities as regards the non-imputability of
the measure to the State.

retroactively therefore seems

(32) Accordingly, the Commission concludes the involvement
of State resources and the imputability of the granting
of the loan to the Bremen authorities.

it is
quantified. Therefore, according to the case-law,
necessary to place oneself in the context of the period
during which the financial support measures were taken
in order to assess the economic rationality of the State's
conduct, and thus refrain from any assessment based on
a later situation (24). This is why the Commission has to
assess the conditions of the loan from the standpoint of
1999, when the loan was granted to Space Park
Development GmbH & Co., KG, and of 2000, when the
loan was prolonged for an open-ended period of time.

(aa) T h e a p p l i c a t i o n o f t h e r e f e r e n c e r a t e s

(b) Conditions of the loan and its aid element

(36)

(33)

(34)

the

the

the determination of

loan on the market at

In order to further decide whether the grant of a loan
by a public authority contains elements of State aid, it
has to be examined in particular whether the company
could get
same
conditions (21). The aid element corresponds to the
residual balance between the interest rate corresponding
to real market conditions and the actually paid rate (22).
the market consideration
For
within the framework of the granting of a loan and for
the calculation of the aid equivalent, the Commission
notice on the method for setting the reference and
discount rates (23) is applicable. In this communication
the Commission states the abstract parameters, which it
uses for the calculation of the aid element of an aid that
is disbursed in several instalments and to calculate the
aid element resulting from interest subsidy schemes for
loans.

of

aid

the

the

evaluation

equivalent,

For
the
Commission uses a reference rate, which is supposed to
reflect the average level of interest rates charged, in the
various Member States, on medium and long-term loans
(five or ten years) backed by normal securities. The
reference rate thus determinated is a floor rate, which
may be increased in situations involving a particular risk
(e.g. undertaking in difficulty, or where the security
normally required by banks is provided). In such cases,
the premium may amount to 400 basis points or more
the
if no private bank would have agreed to grant
relevant loan.

(37)

(38)

the Commission's

committed themselves

In this context the Commission notes that the German
to demand the
authorities
applicable reference rates retroactively. It is also noted
that
reference rate for Germany
amounted to 4,73 % as from 1 January 1999, to 4,76 %
as from 1 August 1999, to 5,61 % as from 1 November
1999, to 5,70 % as from 1 January 2000, to 6,33 % as
from 1 January 2001, to 5,23 % as from 1 December
2001, to 5,06 % as from 1 January 2002 and to 4,80 %
as from 1 January 2003.

(bb) N o i n d i c a t i o n t o a s s u m e a p a r t i c u l a r
r i s k w h e n t h e l o a n w a s g r a n t e d

the Commission notes

In addition to that,
that
according to the information available, the reference rate
has not been increased in the present case since no
situation involving a particular risk could be assumed at
the times the loan (i.e. loan I and loan II) was granted,
i.e. based on the data
to the Bremen
authorities and SWG in 1999 and 2000:

available

and

granted

submitted

authorities

The German
information
according to which the beneficiariy did not have to be
regarded as an enterprise in difficulties at the time the
loan was
Park
Development GmbH & Co., KG itself was founded in
1997 by Köllmann AG in order to develop the Space
Park project. Following the information available, Space
Park Development GmbH & Co., KG was clearly not an
undertaking in difficulties at
the time the loan was
granted.

prolonged.

Space

(35)

In any case, the situation would have to be viewed from
the point of view of the lender at the moment the loan
is approved. If he chooses to lend on conditions which
could not be considered as normal
in banking terms,
then there is an element of aid involved which has to be

(21) Case 40/85, Belgium/Commission (Boch),

[1986] ECR 2321

(2345) point 13.

(22) See Case T-16/96, Cityflyer Express,

[1988] ECR I-757 (777)

point 52.

(23) OJ C 273, 9.9.1997, p. 9.

(39) However,

it has to be taken into account that Space
Park Development GmbH & Co., KG belonged to the
Köllmann-Group, which has given an express written
guarantee in relation to the loan, and therefore its
situation has to be seen in the context of the financial

(24) See for
point 71.

instance case C-482/99 (Stardust), referred to above,

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Official Journal of the European Union

27.2.2004

situation of Köllmann AG. Köllmann AG seems to be in
financial difficulties since 2002. Nevertheless, at
the
time the loan was granted, Köllmann AG was one of the
leading German project development companies and
had realised numerous large projects in- and outside
Germany in 1997. At the time the loan was granted,
Köllmann AG had a very high equity capital of DEM
150 million (EUR 75 million), which was far above the
amount of the loan. At the end of 1997, the profit and
loss account showed sales of almost DEM 308 million
(EUR 154 million) and a balance sheet profit of about
DEM 45 million (EUR 22,5 million). In addition to the
financial situation of Köllmann AG, the granting of the
loan was also based on appropriate financial forecasts.
Köllmann AG made a financial plan according to which
all obligations in the context of the Space Park Bremen
project would be met by the cash flow originated from
the operation of Space Park Development GmbH & Co.
KG.
resulted in expected expenditures of about
DEM 862 million (EUR 431 million) and expected
financial revenues of about DEM 960 million (EUR 480
million) for the years 1999 to 2002. Thus a cash flow
of DEM 100 million (EUR 50 million) was expected, far
above the amount of the loan. In addition, a profit of
DEM 200 million (EUR 100 million) was also expected.

It

These forecasts were carefully verified by SWG. In this
context SWG relied on an expertise
from FIDES
Treuhandgesellschaft, which is an independent auditing
company. FIDES had confirmed the plausibility of the
financial forecasts.

concludes

The Commission therefore
that before
granting the loan, SWG had verified the financial
situation of both Space Park Development GmbH & Co.
KG and its parent enterprise Köllmann AG and the
financial plan of the Space Park Bremen project by itself
as well as through the expertise of FIDES. Accordingly,
following the information available, in 1999 and even in
2000, there was no indication for a borrower in the
position of SWG to doubt the solvency of Space Park
Development GmbH & Co., KG or its parent company
Köllmann AG. The granting and the prolongation of the
loan in the years 1999 and 2000 do not show an
unjustified risk.

(43)

(44)

(45)

(46)

and still has original capital of DEM 290 million (about
EUR 145 million) and was and still is the owner of the
Space Park — properties.

It is therefore concluded that the loan given by SWG to
Space Park Development GmbH & Co. KG was backed
by securities which, following the information available,
were valuable and which more than doubled the
amount of the loan.

it has

to be mentioned that

Eventually,
loan
amounting to DEM 26 million (EUR 13 million) in the
context of an investment project of about EUR 500
million appears to be rather limited and does not seem
to involve a particular risk.

a

the leisure park
Finally, as regards the prospects of
market
from the standpoint of 1999 and 2000, the
Commission reminds on several similar leisure park
projects launched or realised during this period, like for
instance Parco Navi (25), Pompei Tech World (26) or
Terra Mítica (27). The Commission acknowledged for
instance in the Pompei Tech World case that there is a
large scope for an expansion of this particular market
segment. Accordingly, the Commission cannot find a
particular risk only because of the nature of the project.

on the
The Commission concludes
information available, no particular risk can be assumed
at the time the loan was granted in 1999 and even at
the time of its prolongation in 2000. The reference rate
as a floor rate has not to be increased.

based

that,

(cc) R i s k a s s u m e d b y S W G a s r e g a r d s t h e

p r o l o n g a t i o n o f t h e l o a n

group guarantee

(Konzernbürgschaft)

In addition, following the information available, the loan
was backed by securities normally required by private
banks. The loan was backed by the following securities:
a
given by
Köllmann AG, amounting to DEM 26 million (EUR 13
million), a land charge given by Köllmann AG with a
value of DEM 11 million (EUR 5,5 million) and a
directly enforceable guarantee given by Space Park KG,
amounting to DEM 26 million (EUR 13 million). The
Commission notes that Space Park KG was owned by
the following share holders in 1999 and 2000: DEGI
owned 90 %, KanAm EuroMalls GmbH owned 5 % and
Köllmann AG owned 5 % of the shares of Space Park
KG. As already mentioned, DEGI is a subsidiary of the
Dresdner Bank AG. The company Space Park KG had

(47) According to the information at

the disposal of

the
Commission, the loan was prolonged under the same
In
for an open-ended period of
conditions
principle, a private bank in a market economy does not
prolong a loan for an open-ended period of
time
(without any schedule of reimbursement). In this sense
also, such a prolongation bears an element of State aid
within the meaning of Article 87(1) EC.

time.

(25) State aid N 132/99 — Italy (OJ C 162, 10.6.2000, p. 33).
(26) State aid N 229/01 — Italy (OJ C 330, 24.11.2000, p. 2).
(27) State aid C 42/2001 (ex NN 14/01) — Spain (OJ L 91, 8.4.2003,

p. 23).

(40)

(41)

(42)

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L 61/73

(48) Up to March 2002,

and therefore SWG,

i.e. up to the time the Bremen
authorities
according to the
information available (28), were definitely informed that
the financial situation of Köllmann had worsened the
Commission has no reason to believe that such a
It is
prolongation involved additional risks for SWG.
common that huge projects such as the Space Park
project are delayed and that prolongation of
the
financing is necessary. The financial forecasts had no
reason to be changed and the loan was still backed by
the same securities. Therefore, for this period also the
reference rate as a floor rate has not to be increased.

(49) On the opposite, as from April 2002,

the

the Bremen
authorities and therefore SWG were definitely informed
that the financial situation of Köllmann had worsened.
From this time, it is very disputable that a private bank
same
would have prolonged such a loan at
conditions. This is all the more so since from that time,
the presence of Köllmann as a lead investor in the Space
Park project started to be questioned. According to the
sixth subparagraph first indent of the above-mentioned
Commission notice, the premium (in addition to the
floor
in case of an undertaking in
difficulties may amount to 400 basis points or more if
no private bank would have agreed to prolong the loan.
Despite
the German
information injunction,
authorities did not provide the Commission with clear
In
reasons
present
prolongation.
this
circumstances therefore, given that
the loan is still
secured, the Commission assumes that an increase of
is
the
appropriate in order to reflect the risk increase of SWG.

rate by 400 basis points

reference rate)

reference

floor

the

the

for

(dd) T h e u s e o f c o m p o u n d i n t e r e s t

the

the

aid,

adjustment of

loan agreement

the
forfeited

(51) However, in order to remove all potential distortion of
the
competition deriving from the potential
Commission wishes to remind the German authorities
on the Commission communication on the interest rates
to be applied when aid granted unlawfully is being
recovered (29). By modifying
loan agreement
unfair
beneficiary
the
retroactively,
advantage which it enjoyed over its competitors on the
market and the conditions of competition which existed
prior to the payment of the loan were restored. The
retroactive
is
therefore comparable with the recovery of illegal aid
and the principles as stipulated in the above-mentioned
Communication have to be applied for the medium
term non-interest bearing loan granted to Space Park
Development GmbH & Co., KG (30). In addition, it has
to be mentioned that abuse could not be excluded in
if
similar cases
the
the Commission would accept
the reference rate retroactively in the
application of
present case without
the use of compound interest.
Otherwise Member States could try to circumvent an
expected negative decision that would order the use of
the reference rate on the basis of compound interest by
modifying the measure
retroactively by using the
applicable reference rate, but on the basis of simple
the use of compound interest
interest. Accordingly,
appears
financial
advantages of
the loan are fully neutralised. These
compound interests have to be calculated on the
interests to be paid,
themselves calculated using the
reference rate (as adjusted) as follows from the above.

necessary

ensure

that

the

to

(50)

The Commission also takes note of the commitment of
Germany that the loan will be paid back at short notice.
Should it not be the case, even considering the increase
of the floor reference rate as mentioned above, the loan
would entirely amount as operating aid to Space Park
Development GmbH & Co. KG and its parent company
Köllmann AG.

3. Legality of the measure

(52)

The Commission regrets that Germany granted and
prolonged the loan without prior notification under
Article 88(3) of the EC Treaty or did not design the loan
as non-aid from the beginning.

in

Bremische

(28) The Commission did not receive any precise information from the
German authorities as of when SWG definitely knew that the
financial situation of Köllmann AG had worsened. However, the
Bremen Senator for Economic Affairs explained in a debate on
local
request
Bürgerschaft
parliament
the
(Stadtbürgerschaft)
that Köllmann had informed the Bremen
authorities in March 2002 that it was in financial difficulties (see
record of the 38th session of the 15th Bremische Bürgerschaft
(Stadtbürgerschaft) on 17 September 2002, Plenarprotokollnr.: PlPr
15/38, S. 1761, available under http://bremische-buergerschaft.de/).
Since no exact date was mentioned, the Commission therefore
considers that both the Bremen authorities and SWG, acting on
behalf of
the Bremen authorities as described above, were
informed in March 2002 and had to take this information into
account as from April 2002.

4. Compatibility of the measure with the EC Treaty

(53)

The Commission would not have to adopt a partly
negative decision if the measure were compatible with

(29) OJ C 110, 8.5.2003, p. 21 (Corrigendum OJ C 150, 27.6.2003,

p. 3).

(30) See

6

in

of

particular

subparagraph

the Commission
communication on the interest rates to be applied when aid
granted unlawfully is being recovered (OJ C 110, 8.5.2003, p. 21
and OJ C 150, 27.6.2003, p. 3), where the following is stated: ‘(…)
it appears that
the effects of an unlawful aid are to provide
funding to the beneficiary on similar conditions to a medium term
non-interest bearing loan. Accordingly,
the use of compound
interest appears necessary to ensure that the financial advantages
resulting from this situation are fully neutralised. (…).'.

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27.2.2004

the EC Treaty. On this basis, an assessment must be
made as to whether that measure can be considered
compatible with the common market.
It should be
pointed out that the German authorities did not invoke
any exemption clause of
the Treaty with regard to
possible State aid elements in connection wit the loan at
stake.

the loan must be abolished by terminating the loan or
modifying it
in an appropriate way. One means for
Germany to eliminate the aid by modifying the loan
would be to increase the interest rate by 400 basis
points, and modify the loan so that it will be paid back
at short notice.

(54) None of the exemption clauses of Article 87(2) of the
EC Treaty are applicable. The aid is not of a social
character, is not granted to individual consumers, does
not make good the damage caused by natural disasters
or exceptional occurrences, and does not compensate
for economic disadvantages caused by the division of
Germany.

(55) Given that the aid has no regional objective — it is
designed neither to promote the economic development
of areas where the standard of living is abnormally low
or where there is serious underemployment nor
to
facilitate the development of certain economic areas —
the EC Treaty for
neither Article 87(3)(a) nor (c) of
the
regional
applicable. On the basis of
information provided by the German authorities,
the
granting of the aid was not linked to any conditions. A
regional derogation is therefore not possible.

aid is

(56)

There is no justification applicable for the aid at stake as
regards a serious disturbance in the German economy
nor the promotion of the execution of an important
project of common European interest in the meaning of
Article 87(3)(b) of the EC Treaty.

(57) Under Article 87(3)(c) of the EC Treaty, aid may be
if
found compatible with the common market
it
facilitates
economic
development
activities. This might in principle also apply to the loan
at stake. However, in the case at hand, no condition for
the application of this exemption clause is met since the
granting of the aid was not linked to any condition.

certain

the

of

(58)

The aid is not aimed either at promoting culture or
heritage conservation in the meaning of Article 87(3)(d)
of the EC Treaty.

(59) Accordingly, no exemption from the principle of the
ban on State aid pursuant to Article 87(1) of the EC
Treaty applies.

V. CONCLUSION

(60)

In view of the above, as regards the period of time after
execution of this decision, the incompatible State aid in

(61) As regards the period of time up to execution of this
decision, the Commission finds that the loan involves
State aid, to be calculated on the basis of the difference
between the interest
rate actually charged and the
relevant reference rate, where appropriate increased by
400 basis points. This illegal and incompatible State aid
must be recovered by Germany from the beneficiary.
The amount to be recovered must be subject to interest
at the reference rate in force when the loan was granted,
annually compounded.

(62)

from the date of grant

the purpose of calculating the amount of aid
For
involved in the loan, the relevant interest rate (31) will
apply
to the date of
prolongation. Then the relevant interest rates will apply
from the day the loans were prolonged, i.e. 1 January
2000 for loan I and 1 April 2000 for loan II, up to
31 March 2002 (32). Finally, the relevant interest rates,
increased by 400 basis points, will apply as from 1
April 2002 up to the date the illegal and incompatible
aid is reimbursed (33).

(63)

These determinations are also essentially consistent with
the conclusions accepted by Germany during the course
of the administration procedure, and the undertakings
given by it to that effect.

(64) As regards the participation of Bremen in Köllmann AG,
the Commission concludes that the measure has become
taken
without object since the participation has not
place.

(31) The applicable interest rate was 4,73 % for Germany on 15 April

1999.

(32) As the loan is open-ended the relevant reference rate has to be

used for each period it is applicable:
For loan I: 5,70 % from 1 January 2000 to 31 December 2000;
6,33 % from 1 January 2001 to 30 November 2001;
5,23 % from 1 December 2001 to 31 December 2001; 5,06 %
from 1 January 2002 to 31 March 2002.
For loan II: 5,70 % from 1 April 2000 to 31 December 2000;
6,33 % from 1 January 2001 to 30 November 2001;
5,23 % from 1 December 2001 to 31 December 2001; 5,06 %
from 1 January 2002 to 31 March 2002.

(33) As the loan is open-ended the increased reference rate has to be
used for each period it is applicable, i.e. for loan I and II: 9,06 %
from 1 April 2002 to 31 December 2002; 8,80 % as from 1
January 2003. Any potential future modification of the relevant
reference rate up to the date the loan is reimbursed has to be
taken into account.

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HAS ADOPTED THIS DECISION:

Article 1

aid to be recovered shall be subject to interest at the reference
rate
annually
compounded.

in force when the

loan was

granted,

The loan granted on 15 April 1999 by Germany, through
SWG Grundstücks GmbH & Co. KG, to the beneficiary, Space
Park Development GmbH & Co. KG,
involves illegal and
incompatible State aid, to be calculated on the basis of the
difference between the interest rate actually charged, and the
relevant applicable reference rate, increased from 1 April 2002
by 400 basis points.

Article 4

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

Article 2

Article 5

Germany shall immediately take all necessary steps to abolish
forthwith the illegal and incompatible State aid contained in
the loan. If the loan is to continue, Germany shall forthwith
alter the measure,
imposing an interest rate at the reference
rate plus 400 basis points, and inserting a provision pursuant
to which the loan is to be paid back at short notice.

Article 3

Germany shall immediately take all necessary steps to recover
from the beneficiary the illegal and incompatible State aid. The

This Decision is addressed to Germany.

Done at Brussels, 17 September 2003.

For the Commission

Mario MONTI

Member of the Commission