2005/827/EC: Commission Decision of  16 June 2004  on the measures implemented by Spain for Siderúrgica Añón SA  (notified under document number C(2004) 1813)   (Text with EEA relevance)
Date: 2004-06-16
Institutions: European Commission
Subjects: Spain, State aid, control of State aid, interest rate subsidy, investment aid, iron and steel industry

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Official Journal of the European Union

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II

(Acts whose publication is not obligatory)

COMMISSION

COMMISSION DECISION

of 16 June 2004

on the measures implemented by Spain for Siderúrgica Añón SA

(notified under document number C(2004) 1813)

(Only the Spanish text is authentic)

(Text with EEA relevance)

(2005/827/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 provisions cited above (1), and having regard to
their comments,

Whereas:

I. PROCEDURE

(1)

(2)

(3)

Following press reports that a new company, Siderúrgica
Añón SA (hereinafter Siderúrgica Añón), had obtained a
loan of EUR 9,62 million, with the backing of
the
regional government of Galicia, to finance the installation
of a rolling mill, the Commission requested information
on that measure by letter of 14 May 2001. By letter of 2
July 2001,
that
request.

the Commission sent a reminder of

the Spanish authorities
By letter of 10 July 2001,
informed the Commission of the existence of the loan
and of a guarantee granted by the Galician Institute for
Economic Development (IGAPE).

By letter of 27 July 2001, the Commission requested
further information on the terms of the loan and the
guarantee.

(4)

(5)

(6)

(7)

(8)

Following two reminders dated 19 September and 12
October 2001,
the Spanish authorities provided the
information requested by letter of 25 October 2001,
supplemented by letter of 12 November 2001.

the Commission
By letter dated 20 December 2001,
notified Spain of
its decision to initiate proceedings
under Article 6(5) of Commission Decision No
2496/96/ECSC of 18 December 1996 establishing
industry (2)
Community rules for state aid to the steel
(hereinafter
the
measures.

the Steel Aid Code)

in respect of

The Commission decision to initiate the procedure was
published in the Official Journal of the European Commu-
nities (3). The Commission invited interested parties to
submit their comments on the measures. At the same
time the Commission issued an information injunction
requesting certain information.

By letter dated 1 March 2002, the Spanish authorities
submitted their comments and provided some of the
information requested. The missing information was
submitted by letter dated 19 April 2002 and supple-
mented by letter dated 7 May 2002.

The Commission received comments from interested
It forwarded them to Spain, which was given
parties.
the opportunity to react;
its comments were received
by letters dated 26 March 2002.

(1) OJ C 33, 6.2.2002, p. 9 and OJ C 223, 19.9.2002, p. 2.

(2) OJ L 338, 28.12.1996, p. 42.
(3) OJ C 33, 6.2.2002, p. 9.

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(9)

information provided by Spain,

the
Following the
Commission decided on 2 July 2002 to extend to
other measures the procedure already initiated against
the loan and guarantee referred to in recital (2).

(13)

(10)

By letter dated 9 August 2002, the Spanish authorities
submitted their comments.

(11)

The Commission decision to initiate the procedure was
published in the Official Journal of the European Commu-
nities (4). The Commission invited interested parties to
submit their comments on those measures.

(12)

The Commission received comments from interested
parties.
It forwarded them to Spain, which was given
the opportunity to react.

II. FACTS

1. The recipient

Siderúrgica Añón is a company created in January 2000
for the production and sale of steel products. It started
production tests in March 2002. When it was created, its
share capital amounted to EUR 3 004 800 and was
subscribed by Hierros Añón SA (hereinafter Hierros
(hereinafter
Añón)
Rodonita) (33,33 %).

(66,66 %)

Rodonita

and

SL

(14) Hierros Añón is a company dedicated to the sale of steel
products. Through its subsidiary Gallega de Mallas SL
it also produces welded
(hereinafter Gallega de Mallas),
steel mesh.

(15)

The following table shows the relevant figures for the
group:

1999

2000

Employees

Turnover
(EUR million)

Balance sheet
(EUR million)

Employees

Turnover
(EUR million)

Balance sheet
(EUR million)

Gallega de Mallas

Hierros Añón

Promociones Añón

Siderúrgica Añón

Total

22

NA

0

0

15,2

18,0

0,0

0,0

33,2

9,9

9,8

0,2

0,0

19,9

22

20

0

0

42

18,4

22,5

0,0

0,0

40,9

9,9

15,4

0,2

12,0

37,5

(16)

Rodonita is a company belonging to the Epifanio Campo
SL group (hereinafter Epifanio Campo) which is mainly
active in the industrial materials sector.

(17)

The following table shows the relevant figures of the
companies in which Rodonita holds more than a 25 %
stake:

1999

2000

Employees

Turnover
(EUR million)

Balance sheet
(EUR million)

Employees

Turnover
(EUR million)

Balance sheet
(EUR million)

Pretensados Campo

Campo Brick

Epifanio Campo

Nueva Cerámica
Campo

A Ostreira

Cerámica Campor
Saez

Siderúrgica Añón

Total

20

37

26

35

7

25

0

150

1,99

1,12

6,16

4,20

0,17

0,87

0,0

14,51

1,86

12,61

11,92

6,93

0,86

0,74

0,0

34,93

19

26

27

32

7

29

0

140

1,52

3,93

12,21

4,34

0,26

1,48

0,0

23,74

2,41

13,89

17,69

6,22

0,90

0,80

12,0

53,94

(4) OJ C 223, 19.9.2002, p. 2.

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(18) According to the Spanish authorities, the main objectives
of Hierros Añón and Rodonita with this investment are:
(a) to cover their needs in steel products so as not to
depend on external sources as they have done until now;
(b) to achieve uniform quality in their products; (c) to
increase the value added within the groups. It is planned
that 70 % of Siderúrgica Añón’s production will be
directed to the companies belonging to those groups
while the rest will be exported outside the Community
(mainly North Africa and Latin America, but possibly
Asia too). That percentage will be lower when the
second phase of the project is finished.

(19)

Total investment costs for the project initially amounted
to EUR 29 992 589. They were to be financed through
own resources, public aid and loans.

2. The market

(20)

The company will produce its finished products (concrete
reinforcing bars
from steel billets
in bars or coils)
purchased in the open market. Concrete reinforcing
bars are a low value added product used in the
building sector.

(21) Although substantial capacity reductions took place in
the years 1995 to 1997 (for example, production
capacity was reduced by 3,4 million tonnes per year in
Italy), the sector in which Siderúrgica Añón is active
suffers from overcapacity, as is shown in the following
tables:

Straight concrete reinforcing bars

Community production
(million tonnes)

Community capacity
(million tonnes)

Utilisation rate (%)

1997

1998

1999

2000

11,8

12,0

12,0

12,5

19,5

18,2

17,6

17,5

60,2

65,6

68,5

71,4

Source: Reports on investments in the Community coal and steel industries. Office for Official Publications of the European Communities.

Coiled concrete reinforcing bars

Community production
(million tonnes)

Community capacity
(million tonnes)

Utilisation rate (%)

1997

1998

1999

2000

2,0

1,7

2,2

3,0

2,8

2,8

2,8

3,7

70,6

60,2

77,1

80,5

Source: Reports on investments in the Community coal and steel industries. Office for Official Publications of the European Communities.

(22)

In 1999 Spain exported about 480 000 tonnes of these
products to the rest of
imported about
290 000 tonnes from the rest of the Community.

the EU.

It

(23)

Concrete reinforcing bars are produced throughout the
Community except in Ireland, Sweden and Finland.

3. Description of the measures

(24) On

10 November

regional
government, through IGAPE, awarded Siderúrgica Añón

the Galician

2000

a grant of EUR 2 399 407 representing 8 % of
the
eligible costs (of which EUR 285 681 was paid up
until 31 July 2002). IGAPE was created in 1993 and
acts as a channel
the Galician
regional government to stimulate the Galician economy.

the activities of

for

(25) On 29 December 2000 the Spanish Ministry of Science
and Technology granted an interest-free loan of EUR
1 803 036 with a maturity of 15 years and a five-year
grace period.

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(26) On 2 April 2001 Siderúrgica Añón contracted a
syndicated loan of EUR 9 616 193 with seven banks
under the cover of a broader agreement between the
Galician regional government and those banks, the so-
(INESGA)
called Inversiones Estratégicas de Galicia
facility (5). The interest rate is Euribor three months
+ 25 basis points and a one-off
formalisation fee of
0,5 %. The repayment of 30 % of this loan is covered
by IGAPE’s subsidiary guarantee. For this guarantee, the
company pays a premium equivalent to 0,2 % of the
IGAPE had also agreed on 1
amount guaranteed.
February 2001 to subsidise 25 basis points of
the
interest rate as well as the formalisation fee for the loan.

SCR,

SODIGA Galicia

(27) On 19 April 2001 Siderúrgica Añón’s share capital was
increased to EUR 10 217 220. The publicly controlled
company
SA (hereinafter
SODIGA), provided EUR 1 803 060 (the actual contri-
bution amounted however only to a share value of
EUR 1 202 040 as the price of EUR 60 per share to
be paid was increased by a premium of EUR 30),
Hierros Añón EUR 4 006 860 and Rodonita EUR
2 003 520. The private partners paid EUR 60 per
share, half of which was paid immediately, with the
other half
to be paid before the end of September
2001. After this increase in capital, Siderúrgica Añón’s
capital was held as follows: Hierros Añón 58,82 %;
Rodonita 29,41 %; SODIGA 11,76 %. The parties also
signed an agreement whereby Hierros Añón and
Rodonita
promised
Siderúrgica Añón
SODIGA to buy SODIGA’s stake by no later than 19
following two
the higher of
April 2007 for
amounts:
the
if necessary, by independent
firm,
as determined,
expertise; or (b) 141,85 % of
the initial contribution,
i.e. EUR 2 557 640,61. SODIGA will receive from Side-
rúrgica Añón as from 30 December 2002 five annual
instalments of EUR 150 916 as an advance payment
against the final amount.

the theoretical accounting value of

itself)

the

(or

(a)

(28)

regional

SODIGA is a risk capital company controlled by the
Galician
to
government
acquiring temporary stakes in undertakings related to
the development of Galicia’s economy and industry.
SODIGA’s
the Galician regional
are:
and 46,6 % through
(20,6 % directly
government

shareholders

dedicated

and

(5) INESGA is a development fund dedicated to facilitating the financing
interest for the Galician economy,
of viable projects with special
institutions. On 29 May 2000,
through agreements with financial
the Galician regional government and seven banks
signed an
agreement whereby these banks undertook to contribute up to
EUR 108,2 million for the financing of investment projects. Under
the terms of the agreement, any participating bank can refuse to
contribute to the financing of any given project.

grants

institutions

(32,8 %). SODIGA
IGAPE) and financial
receives
from IGAPE which up to 2000
amounted to EUR 6 861 574,89. These grants must be
used in the
i.e.
investments riskier than those normally financed by the
company or with longer maturities or amortisation
periods or investments in certain geographical areas.

financing of

investments,

special

(29) On 1 March 2002 Siderúrgica Añón’s share capital was
increased by a further EUR 4 207 140. The three share-
holders subscribed according to their stakes (SODIGA
contributed EUR 495 180) and on the same terms for
all three shareholders as to price per share and payment.
The parties also signed an agreement whereby Hierros
Añón and Rodonita
Siderúrgica Añón itself)
promised SODIGA to buy SODIGA’s stake by no later
than 19 April 2007 for the higher of the following two
amounts: (a) the theoretical accounting value of the firm,
as determined, if necessary, by an independent expertise;
or (b) 133,82 % of
i.e. EUR
662 650. SODIGA will receive from Siderúrgica Añón
as from 30 December 2003 four annual instalments of
EUR 41 867 as an advance payment against the final
amount.

the initial contribution,

(or

4. Grounds for initiating the procedure

(30)

In its decisions initiating proceedings, the Commission
expressed its doubts whether
the stake acquired by
SODIGA in the share capital of Siderúrgica Añón could
be regarded as a genuine provision of
risk capital
investment practice in a market
according to usual
economy and whether the price paid for the guarantee
was a market price. Moreover, the Commission expressed
its doubts as to the compatibility with the common
market of
the other
for
measures
financing the investment, listed in the previous section.

the Spanish authorities

those measures

adopted by

as well

as

III. COMMENTS FROM INTERESTED PARTIES

(31)

In their letter of 22 February 2002, the European Inde-
pendent Steelworks Association (EISA) considered that
the aid was incompatible with the common market
steel bars was
the market
mainly because (a)
suffering from overcapacity,
(b) the investment would
never be profitable and would lead only to distortions
of competition and (c) no private investor would risk
capital in current market conditions for the production
of these products.

for

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(32)

In their letter of 5 March 2002, the Unión de Empresas
Siderúrgicas (UNESID) considered it illogical that public
funds should be used to build new capacities in a sector
where substantial amounts of public funds had been
devoted to reducing the workforce and capacities.

state aid (7),

mination of the applicable rules for the assessment of
to which the communication
unlawful
from the Commission concerning certain aspects of the
treatment of competition cases resulting from the expiry
of
referred, mentioned only
frameworks, guidelines, communications and notices
but not regulations.

ECSC Treaty (8)

the

(33)

(34)

letter of 8 March 2002, Federacciai,
Italian steel companies, argued that

the
In their
federation of
the
market for steel bars was suffering from overcapacity
and that investments in the sector therefore involved
high risk and could hardly be expected to be profitable.
Moreover, it considered that the involvement of SODIGA
and INESGA was prompted by political considerations.
Finally,
the loan granted through
INESGA and the premium paid for the guarantee did
not correspond to market conditions.

the interest rate of

In their letter of 17 October 2002, UK Steel Enterprise
Ltd. (hereinafter UK Steel) submitted that overcapacity,
excessive
third-country competition and low prices
were the features of this sector and all indicated that a
normal private investor would not have contributed
capital towards the creation of new capacity. It should
be questioned whether Hierros Añón and Rodonita
themselves would have invested in this project had it
not been for
aid.
availability of
Furthermore, the fact that Hierros Añón and Rodonita
were to use 70 % of the output for their own internal
purposes had to put a question mark over the likely
profitability of Siderúrgica Añón. Transfer pricing of
the product would be untransparent
and would
presumably be geared more towards maximising the
downstream profitability of Hierros Añón and Rodonita
than that of Siderúrgica Añón.

illegal

state

the

(35)

By letter dated 31 July 2002, Siderúrgica Añón made the
following submissions:

(37)

In these circumstances, since Siderúrgica Añón was an
SME and the intensity of the aid granted (9) was lower
than the intensity mentioned in Article 4 of the SME
Regulation, the aid was compatible with the common
market (and exempted from the notification obligation).

(38) Moreover, as to the grant awarded by IGAPE and the
interest-free loan granted by the Ministry of Science
they were
and Technology,
granted under schemes approved by the Commission
on 5 July 1995 (state aid N 21/95) and 18 May 2001
(state aid N 182/01) respectively and were therefore
compatible with the common market.

the company argued that

(39) As to the stake acquired by SODIGA in the capital of
Siderúrgica Añón, the company claimed that the fact that
the interests of the private and public shareholders might
be different was of no relevance since the essential factor
was that the private and public investors participated on
the same terms and conditions. To support this position
the company contended that
the Commission had
considered that there was no state aid involved in the
stake acquired by Bavaria in the capital of NMH along
with three other steel producers (Decision of 26 July
1988, mentioned in the Commission Decision of 31
October 1995) and that when it initiated proceedings
against the stake acquired by the Walloon Region in
Carsid, the Commission did not take into account the
different interests of the private and public shareholders.

(36) According to the company, as from 23 July 2002,
Commission Regulation (EC) No 70/2001 of 12
January 2001 on the application of Articles 87 and 88
of the EC Treaty to state aid to small and medium sized
enterprises (6) (hereinafter the SME Regulation), applied to
the steel sector. The fact that the aid was granted before
the expiry of the ECSC Treaty was of no consequence
since according to settled case-law, Commission decisions
on compatibility of aid had to be based on the elements
of fact and law existing at the moment when the decision
was adopted and not at the moment when the aid was
granted. Moreover, the Commission notice on the deter-

(6) OJ L 10, 13.1.2001, p. 33. Regulation as amended by Regulation

(EC) No 364/2004 (OJ L 63, 28.2.2004, p. 22).

(40)

In its letter of 30 September 2002, the company argued
that, since the three-month period established in Article
6(5) of the Steel Aid Code for adopting a decision had
elapsed, the Commission was no longer entitled to adopt
a decision on the measures referred to in its letter of 20
December 2001.

(7) OJ C 119, 22.5.2002, p. 22.
(8) OJ C 152, 26.6.2002, p. 5.
(9) Grant provided by IGAPE, gge: 0,95 %; interest-free loan by Ministry
of Science and Technology, gge: 2,8 %;
loan granted through
INESGA, gge: 2,32 %; guarantee granted by IGAPE, gge: 0,63 %;
subsidisation by IGAPE of
the loan granted by INESGA, gge:
0,32 %; subsidisation by IGAPE of the formalisation fee, gge: 0,16 %.

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(41)

By letter dated 23 June 2003, Siderúrgica Añón
submitted further comments. Firstly, it claimed that the
aid could not be analysed in the light of the ECSC Treaty
or the Steel Aid Code. Secondly, it maintained that the
aid fell within the scope of the SME Regulation. Thirdly,
it argued that the aid was existing aid within the meaning
of Article 1(b) 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 (10) (hereinafter
the Procedural Regulation) because it was granted before
the entry into force for the steel sector of the state aid
rules of the EC Treaty.

IV. COMMENTS FROM SPAIN

argued that SODIGA participated in proportion to its
holding and on the same terms and conditions as the
other shareholders. In these circumstances there was no
state aid.

(45)

Concerning the imputability of the actions of SODIGA to
the public authorities, the Spanish authorities contended
that, according to the case-law, the Commission had to
provide evidence that they intervened in the decision to
invest in Siderúrgica Añón.

together,

economy.

Investment decisions were

(42) As regards the acquisition by SODIGA of a stake in the
share capital of Siderúrgica Añón, the Spanish authorities
argued that this was done following normal practice in a
market
taken
considering only the viability of the projects and the
In the present case, SODIGA’s
expected profitability.
stake in Siderúrgica Añón was acquired at the time of
the increase in capital and simultaneously with the
existing shareholders which,
subscribed to
83,4 % of the new shares. In these circumstances, the
Spanish authorities maintained that, according to the
case-law,
criteria.
Moreover, the Spanish authorities claimed that, through
the repurchase agreement, SODIGA ensured a minimum
return on the investment of 7,2 % per year, which was
higher than the interest on 10-year Treasury bonds at the
time the contract was signed (5,3 %). In any case, if state
aid was involved it would be compatible with the
common market according to point VIII.3 (ii) of the
information from the Commission on state aid and risk
capital (11) because it involved a medium-sized enterprise
in its start-up stage in an assisted area.

the private

investor

fulfilled

it

(43) As to the fact that SODIGA paid a higher price per share
and disbursed it
immediately,
the Spanish authorities
the minimum
this compensated for
maintained that
return on investment granted to SODIGA, from which
the other shareholders did not benefit. In any case, they
maintained that it was only normal practice that a new
shareholder should pay a higher price for the newly
issued
impetus
imparted to the project by the original shareholders
(for example in contracts with suppliers of equipment
and in the acquisition of land).

substantial

reflecting

shares,

the

sources

they maintained that

(46) With regard to the loan granted through INESGA, the
the funds came
Spanish authorities maintained that
exclusively
(the participating
from private
banks), that those banks were free to participate in the
INESGA’s invol-
financing of any operation and that
vement was limited to the follow-up.
In this sense,
they concluded that no public funds were involved.
Moreover,
the comparison with
the reference rate used by the Commission was not
appropriate since that reference rate corresponded to
the average of
the five-year interbank swap rates for
the months of September, October and November
2000 increased by 75 percentage points. Since the five-
year interbank swap rate at the date of granting the loan
the corrected reference rate should be
was 4,769 %,
5,519 %. Finally, they contended that the interest rate
was
loans
granted to companies belonging to the Añón group.

to, or even higher

than, other

similar

(47) On the guarantee given by IGAPE, the Spanish autho-
rities claimed that it was in line with market conditions.
They contended that the commission applied by private
banks to these types of projects amounted to 0,15 % per
quarter. The difference with the commission applied in
transaction stemmed from the following
the present
factors: (a) the conditions for calling on the guarantee
were much stricter than those of the bank guarantees,
since these were enforceable at first request and IGAPE’s
guarantee was enforceable only in a subsidiary capacity
(once the beneficiary was declared insolvent); (b) the risk
assumed by IGAPE was very low since it covered only
30 % of the loan and the loan financed only 40 % of the
investment; and (c) the project was promoted by groups
known for their solvency.

(44) As for SODIGA’s participation in the second increase in
the capital of Siderúrgica Añón, the Spanish authorities

(48)

(10) OJ L 83, 27.3.1999, p. 1. Regulation as amended by the 2003 Act

of Accession.

(11) OJ C 235, 21.8.2001, p. 3.

The Spanish authorities provided statements from two
banks (Caixa Galicia and Banco Pastor)
to the effect
that,
the loan and the
the conditions of
identity of the shareholders, they would have applied a
commission of 0,20 % per year for such guarantee.

in view of

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schemes

for EUR 14 299,44,

(49) As regards the IGAPE subsidy of 0,25 % and the forma-
lisation fee, the Spanish authorities maintained that this
approved by the
aid was granted under
Commission, and that, except
it
fell within the scope of Commission Regulation (EC)
No 69/2001 of 12 January 2001 on the application of
Articles 87 and 88 of the EC Treaty to de minimis aid (12),
which applied also to the ECSC sector. They also
for those products would
contended that
the products
not be affected since the majority of
would be used within the group and almost all the rest
would be exported outside the EEA.

the market

out the investment. They also drew the Commission’s
attention to Commission Decision 89/515/EEC of 2
August 1989 relating to a proceeding under Article 85
of the EEC Treaty (14) and the related judgments of the
Community lawcourts whereby it was found that some
of the members of EISA had taken part in anti-compe-
titive practices.

V. ASSESSMENT OF THE MEASURES

(54)

(55)

(56)

(57)

(50) As to the grant provided by IGAPE, the Spanish autho-
it was awarded under a scheme
therefore

rities argued that
approved by
compatible with the common market.

the Commission and was

(51)

In any event, the Spanish authorities maintained that the
aid was compatible with the common market because it
the SME Regulation, which
fell within the scope of
applied also to the ECSC steel sector.

(52)

They also affirmed that the aid was in line with the
Community guidelines on state aid for environmental
protection (13). They contended that the system chosen
for water treatment would improve on environmental
protection as compared with the traditional system and
that it represented an additional cost of EUR 661 113.
Similarly, the use of natural gas in the reheating furnace
would drastically reduce emissions as compared with fuel
oil and represented an additional cost of EUR 1 502 530.
Thirdly, the fact that all the civil works for the hydraulic
installations, the lubricating installations, the cabling and
the pipelining had been carried out on the surface instead
of being made underground would improve working
conditions and prevent underground leaks and repre-
sented an additional cost of EUR 6 911 639.

(53) As for the comments made by third parties (see recitals
31 to 34), the Spanish authorities stated that they were
not supported by any factual evidence, and that the asso-
ciations were only trying to prevent the entry into the
market of a new company. In this context, the Spanish
authorities recalled that it was the difficulties of obtaining
supplies of these products from the traditional producers
(mainly undue delay in honouring deliveries) that had
prompted the promoters of the new company to carry

steel bars and rods,
Siderúrgica Añón manufactures
which are products included in Annex I to the ECSC
Treaty.
an undertaking within the
meaning of Article 80 of that Treaty.

therefore

is

It

In the present case,
it is evident that Spain unlawfully
implemented the measures since it did not follow the
the Steel Aid
procedures laid down in Article 6 of
Code. The Commission therefore cannot accept
the
argument put forward by the company (see recital 41)
that the aid was existing aid.

Even though the procedure was initiated under the ECSC
Treaty, the Commission could not adopt a final decision
before 23 July 2002 since the decision extending the
procedure was adopted on 2 July 2002 and sent to the
Spanish authorities on 4 July 2002. The notice of invi-
comments was published on 9
tation to submit
September 2002.
its communication
In point 43 of
concerning certain aspects of the treatment of compe-
the ECSC
resulting from the expiry of
tition cases
Treaty,
it
would continue the investigation under the provisions
of the Procedural Regulation and adopt a final decision
under Article 88(2) of the EC Treaty.

the Commission stated that,

in such cases,

The Commission cannot accept the company’s argument
that the expiry of the three-month period since the initial
decision initiating the procedure prevented it
from
adopting a decision (see recital 40). As the Court of
Justice ruled in its judgment of 12 December 2002 in
Case C-5/01 Kingdom of Belgium v Commission of the
‘the three-month period set
European Communities (15),
out in Article 6(5) of the sixth steel aid code cannot be
regarded as a prescription period linked to loss of
competence’. At present,
the Procedural Regulation is
fully applicable and Article 7(6)
thereof has been
complied with.

(12) OJ L 10, 13.1.2001, p. 30.
(13) OJ C 37, 3.2.2001, p. 3.

(14) OJ L 260, 6.9.1989, p. 1.
(15) [2002] ECR I-11991, paragraph 60.

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1. Existence of state aid

(58) According to 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
the production of certain goods shall, insofar as it affects
trade between Member States, be incompatible with the
common market.

(a) The acquisition by SODIGA of a stake in the share capital

of Siderúrgica Añón

(59) As to the acquisition by SODIGA of a stake in the share
capital of Siderúrgica Añón (see recitals 27 and 29) the
in the first place, that SODIGA is
Commission notes,
controlled by the Galician regional government. The
the Galician regional
Commission also notes
IGAPE’s
government considers that
forms part of
In
programmes for
that
these circumstances
SODIGA’s actions are imputable to the State.

the support of undertakings (16).
the Commission considers

that
it

(60)

In order to decide whether an advantage is conferred on
the beneficiary of the measure, the Commission applies
the market economy investor principle. This principle has
been applied by the Commission in many cases and has
been accepted and developed by the Court in several
judgments (17). The essence of
this principle is that
when a public authority invests
in a company on
terms and in conditions which would be acceptable to
a private
investor operating under normal market
economy conditions, the investment is not state aid.

(61)

In principle, where in a given transaction a private
investor and a public investor take part,
there is no
state aid if the private and the public investor participate
on the same terms and conditions.

(16) Source http://www.xunta.es/Galicia2001/G200112G.pdf
(17) See the Judgment of the Court of 10 July 1986 in Case 234/84
Kingdom of Belgium v Commission of the European Communities
‘An appropriate way of
(Boch) [1986] ECR 2263, paragraph 14:
establishing whether such a measure is a state aid is to apply the
criterion which was mentioned in the Commission's decision and,
moreover, was not contested by the Belgian Government, of deter-
mining to what extent the undertaking would be able to obtain the
sums in question on the private capital markets. In the case of an
undertaking whose capital is held by the public authorities, the test
is, in particular, whether in similar circumstances a private share-
holder, having regard to the foreseeability of obtaining a return and
leaving aside all social, regional-policy and sectoral considerations,
in question’. See also the
would have subscribed the capital
Judgment of
Instance of 6 March 2003 in
Joined Cases T-228/99 and T-233/99 Westdeutsche Landesbank
Girozentrale and Land Nordrhein-Westfalen v Commission of the
European Communities [2003] ECR II-435, paragraphs 255, 266,
313 and 324.

the Court of First

(62)

the case, however, of

the acquisition by
This is not
SODIGA of a stake in the capital of Siderúrgica Añón,
for the following reasons:

(63)

Firstly, in the first increase in capital, SODIGA paid for
its stake immediately, while the private partners paid for
theirs later and SODIGA paid EUR 90 for each of the
shares it acquired, while the private partners paid only
EUR 60 for theirs.

(64)

Secondly, the main beneficiaries of Siderúrgica Añón’s
production will be the private partners, who can make
profits out of these inputs while SODIGA can only count
on the profitability of Siderúrgica Añón in order to
obtain a return on its investment.

(65)

(66)

(67)

since the company had not yet

The Commission cannot accept the argument that the
premium paid by SODIGA is normal practice (see
recital 43)
started
production and was not therefore capable of showing a
particularly good performance record which could justify
a premium. Furthermore, if the argument was accepted, it
would have to be applied to the capital injections made
by all the investors at that time.

The Commission notes, however, that by virtue of the
agreement
the shares, SODIGA
ensured a return on investment of 7,2 % which the
private shareholders did not have (18).

the buy-back of

for

that annual

The Commission considers that, taking into account the
fact
instalments are going to be paid,
SODIGA’s stake is a minority one which does not
allow it any influence over the management of
the
company and that Siderúrgica Añón will produce
mainly for its own shareholders,
from an economic
point of view this stake can be treated as a subordinated
the risk
participating loan. From the standpoint of
involved, however, this investment has to be treated as
normal share capital since although subordinated partici-
pating loans are ranked below other debt instruments
they take priority over share capital.

(18) Although the possibility cannot be ruled out that the final price
could be higher if the alternative method (theoretical accounting
value) was used, according to the latest projections made by
SODIGA in February 2002, the use of this theoretical accounting
value would yield a return on investment of 6,3 %.

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Official Journal of the European Union

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(69)

(70)

(68)

for a private

loan.
adopted

participating
approach

subordinated
following

The question is therefore whether the abovementioned
return on investment of 7,2 % would cover the risk
investor
involved and be acceptable
The
granting
a
in
the
Commission,
Decision 2003/284/EC of 11 December 2002 on the
state aid implemented by Spain for Sniace SA (19),
considers that the normal interest rate to cover the risk
involved would have been 12,33 % for the first increase
in capital and 11,06 % for the second. This corresponds
to the interbank rate used by the Commission for the
calculation of its market reference rate, plus the normal
75 basis points it adds for loans in Spain (6,33 % on 19
April 2001 and 5,06 % on 1 March 2002), plus 600
basis points. These 600 basis points are justified by the
absence of any security, the risk involved in the entry of
a new company in the steel sector, which suffers from
structural overcapacity, and the fact that, as explained
it involves a much higher risk than a normal
earlier,
insolvency, all creditors would have
loan (in case of
priority) (20). This
indications
contained in the Commission notice on the method for
setting the reference and discount rates (21), which states
that the reference rate may be increased by 400 basis
points or more in situations involving particular risk (for

in line with the

is

example, where the security normally required by banks
is not provided).

The Commission considers therefore that the acquisition
of the stake at issue confers an advantage on Siderúrgica
Añón which is financed through state resources.

in the case of

The aid element in the two stakes is equivalent to the
difference in interest rates between 12,33 % and 7,2 %,
in the case of the first stake and between
i.e. 5,13 %,
11,06 % and 7,2 %,
the
i.e. 3,86 %,
second stake. Taking into account the instalments being
paid by Siderúrgica Añón to SODIGA,
this aid then
to the difference between the reimbur-
corresponds
interest
sements actually being paid and the annual
payments and reimbursement of
that
would be due when applying the abovementioned
interest rates of 12,33 % and 11,06 % respec-
normal
tively. The latter results in yearly interest payments of
EUR 222 317,3 due for
stake and EUR
54 766,9 due for the second. The difference between
the appropriate interest payments and the actual reim-
bursement schedule for the two stakes can be set out as
follows (22):

the principal

the first

First stake of EUR 1 803 060 (2001)

Year

2002

2003

2004

2005

2006

2007

Aid-free reimbursement
schedule

Current reimbursement
schedule

222 317

222 317

222 317

222 317

222 317

222 317
+ 1 803 060
= 2 025 377

150 916

150 916

150 916

150 916

150 916

1 803 060

Aid per year

71 401

71 401

71 401

71 401

71 401

222 317

Second stake of EUR 495 180 (2002)

Year

Aid-free reimbursement
schedule

Current reimbursement
schedule

2003

54 766

2004

54 766

2005

54 766

2006

54 766

41 868

41 868

41 868

41 868

2007

54 766
+ 495 180
= 549 946

495 180

Aid per year

12 869

12 869

12 869

12 869

54 766

(19) OJ L 108, 30.4.2003, p. 35.
(20) This approach is also in line with the one taken by the Commission
in Decision 2003/284/EC, in which it added 600 basis points to a
subordinated loan because of the absence of any security. See recital
42 of the Decision referred to in footnote 19.

(21) OJ C 273, 9.9.1997, p. 3. See in particular the eighth paragraph,

first indent.

(22) Concerning the comparison made in the two tables above, account
has to be taken of the fact that the actual rate of return on the
measures, i.e. 7,2 %, corresponds to a hypothetical annual premium
that would also be due in 2007 (the year of reimbursement of the
principal) whereas in reality these revenues have been spread over
only five (instead of six) and four (instead of
instalments
respectively.

five)

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(b) The loan granted through INESGA

(71) As regards the loan granted through INESGA (see recital
26), the Commission considers that state aid elements
could be involved since the interest rate appears to be
rather low. The Commission notes, however, that the
funds are provided by private banks which are free to
decide whether or not to participate in the loan. In these
circumstances, the Commission concludes that the better
intervention
financial
terms
(guarantee,
interest subsidy paid directly to the banks)
and to the fact that it is a syndicated loan. Therefore,
no state aid is involved in the loan itself.

to IGAPE’s

due

are

(c) The guarantee granted by IGAPE

(72) With regard to the guarantee granted by IGAPE (see
recital 26), the Commission’s practice (23) for assessing
individual guarantees includes several conditions for a
In the present
to constitute state aid.
guarantee not
case, the Commission notes that Siderúrgica Añón was
not
the
in financial difficulty within the meaning of
Community guidelines on state aid for rescuing and
restructuring firms in difficulty (24) and has obtained
loans on the financial markets without any intervention
from the State. It also notes that the guarantee is linked
to a specific loan, is for a fixed maximum amount, covers
30 % of the outstanding loan and is not open-ended.
the
Concerning the price paid for
Commission had doubts as to whether the premium
paid (0,2 % per year on the outstanding guaranteed
debt; no formalisation fee) corresponded to the market
price of a similar guarantee taking mainly into account
the lists of maximum prices for guarantees published by
two of the banks participating in the loan.

the guarantee,

(73)

The Commission cannot accept as a comparator the
‘offers’ submitted ex post by the two banks (see recital
(48)) since they are hypothetical and were made for the
purposes of this procedure. In addition, they are those of
two banks and do not therefore necessarily represent the
market’s view.

(74) Neither can the Commission accept

the arguments
concerning the special
the guarantee (see
recital 47) and therefore the reduction in price on the
‘normal’ market rate, for the following reasons: (a) the
fact that guarantees in Spain are normally enforceable at

features of

is explained by the demand for further
first request
In the present case,
security from the beneficiary.
however,
to require
IGAPE expressly waived its right
any other security (after having obtained the agreement
of the Galician regional government); (b) the fact that the
guarantee covers only 30 % of the loan is not relevant
since what matters for the guarantor is the amount of the
risk; and (c) the fact that the project is promoted by
groups known for their solvency is not relevant either,
because these groups would not be liable for Siderúrgica
Añón’s debts.

(75)

specific case,

In these circumstances, the Commission considers that,
the market
rate for a similar
in this
guarantee should be at
indicated by the
least
Spanish authorities, namely 0,6 % per year (see recital
47).

that

(76)

The Commission considers therefore that the guarantee
in question confers an advantage on Siderúrgica Añón
which is financed through state resources.

(77) As for the amount of the state aid involved in such
guarantee, point 3.2 of the notice on guarantees estab-
lishes that the cash grant equivalent for an individual
guarantee should be calculated in the same way as the
grant equivalent of a soft loan, the interest subsidy repre-
senting the difference between the market rate and the
rate obtained thanks to the state guarantee after any
premiums paid have been deducted.
In the present
case,
in order to determine the market rate of such a
loan, and in the absence of other non-guaranteed loans
for the financing of
the Commission
considers it appropriate to use the interest rate of a
non-secured credit facility granted by Caixa de Galicia
to Siderúrgica Añón (principal EUR 3 000 000, interest
rate Euribor 12 months + 0,75, formalisation fee 0,15 %,
maturity one year as from 20 March 2002) (25). The
interest subsidy on the INESGA loan is therefore 0,3 %
(the difference of 0,50 % between the risk premium on
the INESGA loan (Euribor three months + 0,25 %) and
the risk premium on that credit
facility (Euribor 12
months + 0,75 %) minus 0,2 % paid for the guarantee).
This
to EUR 28 848,6 (0,3 % of EUR
amounts
9 616 193) p.a.

the investment,

(23) Commission notice on the application of Articles 87 and 88 of the
EC Treaty to state aid in the form of guarantees (OJ C 71,
11.3.2000, p. 14, point 4.2).

(24) OJ C 288, 9.10.1999, p. 2.

(25) Although the life of, and therefore the base rate for, the two loans
are different,
the risk premium
the Commission considers that
required by a private creditor for a non-secured loan can constitute
a reliable parameter for assessing the aid element involved in the
INESGA loan.

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(78)

(79)

(d) Other measures

The grant provided by IGAPE (see recital 24),
the
interest-free loan granted by the Ministry of Science
and Technology (see recital 25),
the subsidisation by
IGAPE of the interest and the formalisation fee granted
through INESGA (see recital 26) confer an advantage on
Siderúrgica Añón which is
financed through state
resources.

the steel sector from those schemes and imposed the
prior notification obligation. Since this prior notification
obligation has not been respected, the aid granted to
Siderúrgica Añón is not covered by those two schemes.

the aid measures mentioned in the
The amounts of
previous point are the following: the grant provided by
IGAPE: EUR 2 399 407; the subsidies granted by IGAPE
on the loan granted by INESGA: 0,25 % per year on EUR
9 616 193 (interest subsidy), i.e. EUR 24 040,5 p.a., and
0,5 % on EUR 9 616 193 (formalisation fee),
i.e. EUR
48 081 p.a.;
loan granted by the
Ministry of Science and Technology: 5,7 % per year on
EUR 1 803 036, i.e. EUR 102 773,5 p.a.

interest-free

the

(83) According to point 44 of the Commission communi-
the treatment of
cation concerning certain aspects of
the
resulting from the expiry of
competition cases
‘when taking decisions after 23 July 2002
ECSC Treaty,
in respect of state aid put into effect on or before that
date without
the
Commission will proceed in accordance with the
Commission notice on the determination of
the
applicable rules for the assessment of unlawful state
aid’ (28). According to the last paragraph of this latter
notice,
therein are nevertheless
‘without prejudice to the interpretation of Council and
Commission regulations in the field of state aid’.

Commission

approval,

set out

prior

rules

the

(e) Distortion of competition and effect on trade

(80)

In view of
the existence of competition and intra-
Community trade in the sector (see recitals 20 to 23),
the Commission considers that the abovementioned aid
measures distort or threaten to distort competition and
affect trade between Member States.

(81)

therefore that

the grant
The Commission concludes
provided by IGAPE,
the interest-free loan granted by
the Ministry of Science and Technology, the subsidisation
by IGAPE of the interest and the loan formalisation fee
granted through INESGA, the stake acquired by SODIGA
in the share capital of Siderúrgica Añón and the
guarantee granted by IGAPE constitute state aid within
the meaning of Article 87(1) of the EC Treaty.

2. Compatibility with the common market

(82)

The Commission firstly cannot accept the argument that
some of the aid measures were granted under approved
(N 21/95 (26) and N 182/01 (27)).
In the
schemes
Decisions authorising those schemes the Commission
took note of the Spanish authorities' commitment
to
sector. The
respect
Commission notes that
the rules for the steel sector
were contained in the Steel Aid Code, which excluded

the relevant

the steel

rules

for

(84) According to the second subparagraph of Article 9(2) (29)
‘individual aid outside
of Regulation (EC) No 70/2001,
any scheme granted before the date of entry into force of
this Regulation in the absence of a Commission author-
isation and in breach of the notification requirement of
Article 88(3) of the Treaty, shall be compatible with the
common market within the meaning of Article 87(3) of
the Treaty and shall be exempt
the
conditions of this Regulation, except the requirement in
Article 3(1) that express reference be made to this Regu-
lation’.

fulfils all

it

if

(85)

The Commission considers that, in view of the figures on
turnover, workforce or total balance sheet of Siderúrgica
Añón and its linked enterprises (see recitals 15 and 17),
it is a medium-sized enterprise (according to Annex 1 to
the SME Regulation).
therefore has to be assessed
whether any investment aid granted to Siderúrgica
Añón fulfils the conditions of the SME Regulation.

It

(86)

In this respect the Commission notes that, according to
Article 6(1) of the SME Regulation, individual aid grants
are not exempted from the prior notification obligation
where one of the two thresholds mentioned under (a)
and (b) are met.

(26) OJ C 298, 11.11.1995.
(27) OJ C 199, 14.7.2001, p. 11.

(28) OJ C 119, 22.5.2002, p. 22.
(29) Clerical error: should read ‘Article 9a(2)’.

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(87)

It follows that the aid in the form of a grant of EUR
2 399 407 provided by IGAPE cannot be exempted.
According to the Spanish authorities (see recital 24
above) the aid represents 8 % of the investment. The
to EUR 29 992 588,
therefore
investment amounts
which is higher than the EUR 25 000 000 threshold
laid down in Article 6(1)(a). Furthermore,
the steel
industry has to be regarded as a sector which does not
qualify for regional aid according to the third paragraph
of point 1 of the Commission communication on rescue
and restructuring aid and closure aid for
the steel
sector (30) and point 27 of the multisectoral framework
on regional aid for large investment projects (31). The
situation was the same at the time when the steel aid
was granted under the Steel Aid Code. As Siderúrgica
Añón is a medium-sized enterprise, the starting point
for
referred to in Article
6(1)(a)(i) is indicated in Article 4(2)(b) as being 7,5 %.
the gross aid intensity
Pursuant
may thus not exceed 50 % of 7,5 %, i.e. 3,75 %. 8 % is
clearly above this threshold. The gross intensity of the
IGAPE grant has indeed to take into account the full
amount of the grant (which amounts to 8 %) and not
what has been initially disbursed (which amounts to
0,95 %) as claimed by the Spanish authorities
(see
recital 37) because it is the amount granted and not
the amount disbursed that has to be considered for the
assessment of aid.

the applicable ceiling as

to Article 6(1)(a)(i),

granted. Therefore, the aid cannot qualify for the regional
derogation.

(91)

The Commission cannot accept either the argument that
some of the investments were eligible for environmental
aid, for the following reasons:

(92) According to Article 3 of the Steel Aid Code (32), which
sets out the criteria for the application of the environ-
mental guidelines, the Commission must avoid general
investment aid for new plants or equipment being
granted under
environmental protection.
the environmental guidelines (33) applicable
Moreover,
in accordance with the Steel Aid Code state that aid
protection
ostensibly
environmental
measures, but which is in fact for general
investment,
is not covered by them (point 3.2.1).

cover of

intended

for

(93)

In the present case, the Commission notes, in the first
place, that no environmental considerations were taken
into account by the Spanish authorities when granting
the aid.

(88) As it also follows from the last sentence of point 27 of
the multisectoral
framework on regional aid for large
investment projects that large individual aid grants in
the steel sector not exempted under the SME Regulation
are incompatible with the common market, the grant
provided by IGAPE cannot be exempted under the SME
Regulation.
same
conclusions would be reached if the Steel Aid Code in
place at the time when the aid was granted were to be
applied.

stressed that

should be

the

It

(89) All the other aid considered to be investment aid could
not be exempted under the SME Regulation either.
It
would therefore have to be combined with the grant
provided by IGAPE and would therefore be incompatible
following the reasoning set out in recitals 86 to 88.

(90)

Possible compatibility under the regional derogation for
state aid has to be assessed in accordance with the
substantive criteria set out in any instrument in force
at the time when the aid was granted, in line with the
Commission notice on the determination of
the
applicable rules for the assessment of unlawful state
aid. As already mentioned, the Steel Aid Code did not
the time the aid was
authorise any regional aid at

(30) OJ C 70, 19.3.2002, p. 21.
(31) OJ C 70, 19.3.2002, p. 8.

(94)

(95)

The Commission also notes that the investments in the
water treatment system and in the reheating furnace will
increase the efficiency of
the company through a
reduction in the costs of water or energy. The installation
of these types of equipment is normal practice in the
industry without
environmental
investment. The Commission considers that this is the
reason for
they are
environmental
therefore
guidelines (34).

carrying them out
covered
not

and that
the

considered

being

by

In any case, neither the Spanish authorities nor the
recipient have provided any concrete evidence of
the
environmental benefits of
those installations. There is
therefore no need to make use of any independent
expertise or to consult Member States (see the Annex
to the Steel Aid Code). Nor have they deducted all the
advantages in regard to lower costs of production, as the
Annex (35) to the Steel Aid Code requires, or explained
how the additional costs have been calculated.

(32) This provision is applicable for the assessment of the aid granted,
according to the Commission notice on the determination of the
applicable rules for the assessment of unlawful state aid and points
82(b) and 7, second paragraph, of the Community guidelines on
state aid for environmental protection.

(33) Community guidelines on state aid for environmental protection.
(34) See in particular the first sentence of the Annex to the Steel Aid

Code.

(35) See point (b) under ‘Aid to encourage firms to contribute to signif-

icantly improved environmental protection’ in the Annex.

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(96) As for the investment in the civil works, the Commission
considers that there is no environmental benefit and that,
if there were benefits for the safety of workers, these
would not be covered by the environmental guidelines
or by any provision of the Steel Aid Code.

which it was at the disposal of the recipient until the date
of its recovery. Interest shall be calculated on the basis of
the
calculating the grant
equivalent of regional aid,

rate used for

reference

(97)

(98)

(99)

see

that

the aid is not

either under which
The Commission cannot
the Steel Aid Code the aid could be
provision of
deemed compatible. The aid is clearly not aid for
research and development or closure aid and it was
not granted in Greece. Furthermore,
the Commission
notes
training aid within the
meaning of Commission Regulation (EC) No 68/2001
of 12 January 2001 on the application of Articles 87
and 88 of the EC Treaty to training aid (36) and not
employment aid within the meaning of Commission
Regulation (EC) No 2204/2002 of 12 December 2002
on the application of Articles 87 and 88 of the EC Treaty
to state aid for employment (37), (38). In any event, the
Spanish authorities did not rely on any of these dero-
gations or regulations.

the Commission notes that

Finally,
the Commission
notice on state aid and risk capital was not applicable
to the steel sector at the time the aid was granted and is
still not applicable to this sector, according to the eighth
paragraph of point VIII.3 thereof.

the

exceptions

In view of the foregoing, the Commission considers that
none of
from the prohibition on
investment aid to the steel sector is applicable in the
present case and therefore that the measures identified
by the Commission as constituting state aid are not
compatible with the common market.

HAS ADOPTED THIS DECISION:

Article 1

The state aid which Spain has granted to Siderúrgica Añón

1.
SA is incompatible with the common market.

2.

The aid referred to in paragraph 1 includes the following:

(a) the aid element involved in the stake acquired by SODIGA
in the share capital of Siderúrgica Añón, which corresponds
to:

(i) an annual premium of 5,13 % applied to the initial
capital injection of EUR 1 803 060 reduced by the five
annual repayments of EUR 150 916 in the case of the
first stake, acquired in 2001, and

(ii) an annual premium of 3,86 % applied to the initial
capital injection of EUR 495 180 reduced by the four
annual repayments of EUR 41 868 in the case of the
second stake, acquired in 2002;

VI. CONCLUSION

(100) The Commission finds that Spain has unlawfully imple-
mented the state aid measures in question, which are
incompatible with the common market. These measures
must therefore be discontinued.

(101) Moreover, according to Article 14(1) of Regulation (EC)
No 659/1999, where negative decisions are taken in
cases of unlawful aid, the Commission shall decide that
the Member State concerned shall
take all necessary
measures to recover the aid from the recipient. The aid
to be recovered shall include interest from the date on

(36) OJ L 10, 13.1.2001, p. 20. Regulation as amended by Regulation

(EC) No 363/2004 (OJ L 63, 28.2.2004, p. 20).

(37) OJ L 337, 13.12.2002, p. 3.
(38) In line with the last paragraph of the Commission notice on the
determination of the applicable rules for the assessment of unlawful
state aid, the Commission must check whether the aid could be
compatible with any Commission or Council regulation currently in
force in the state aid field.

(b) the grant awarded by IGAPE on 10 November 2000,

amounting to EUR 2 399 407;

(c) the interest subsidies granted with respect to the syndicated
loan of EUR 9 616 193 of 2 April 2001 via the 30 %
guarantee, i.e. 0,3 % p.a., and the direct interest subsidy of
0,25 % p.a. provided by IGAPE, which in total amounts to
EUR 52 889,1 p.a.;

(d) the payment of the formalisation fee of EUR 48 081 by
IGAPE with respect to the loan of EUR 9 616 193 of 2
April 2001;

(e) the interest subsidy of 5,7 % p.a. contained in the interest-
free loan of EUR 1 803 036 granted by the Ministry of
Science and Technology on 29 December 2000.

26.11.2005

EN

Official Journal of the European Union

L 311/35

Article 2

Spain shall refrain from any further grant of aid to the

1.
recipient via the measures referred to in Article 1.

The interest rate referred to in the first subparagraph shall be
applied on a compound basis throughout
the entire period
referred to therein.

With regard to payments already authorised but not made by
the date of adoption of this Decision, Spain may require the
reimbursement of all payments made after the date of adoption
of this Decision or as of that date shall adjust the conditions of
the measures listed in Article 1 to market conditions as referred
to in this Decision.

Article 3

inform the Commission, within two months
Spain shall
following notification of
the measures
this Decision, of
planned and already taken to comply with it. It shall provide
this information using the questionnaire attached in Annex to
this Decision.

Spain shall take all necessary measures to recover from the

2.
recipient the aid referred to in Article 1.

Article 4

3.
Recovery shall be effected without delay in accordance
with the procedures under national law, provided these allow
the immediate and effective implementation of this Decision.
The sums to be recovered shall bear interest throughout the
period running from the date on which they were first put at
the disposal of the recipient until their actual recovery. The
interest rate to be applied shall be the reference rate used for
calculating the grant equivalent of regional aid.

This Decision is addressed to the Kingdom of Spain.

Done at Brussels, 16 June 2004.

For the Commission

Mario MONTI
Member of the Commission

L 311/36

EN

Official Journal of the European Union

26.11.2005

ANNEX

Information regarding the implementation of the Commission Decision

1.

CALCULATION OF THE AMOUNT TO BE RECOVERED

1.1. Please provide the following details regarding the amount of unlawful State aid that has been put at the disposal of

the recipient:

Concise description of
the measure (°)

Date(s) of
payment (°°)

Amount of aid (*)

Currency

Date(s) of
repayment (**)

If the measure consists of several instalments and reimbursements, use separate rows.

(°)
(°°) Date or dates on which the aid or individual instalments of aid were put at the disposal of the recipient.
(*) Amount of aid put at the disposal of the recipient, in gross grant equivalent.
(**) Date or dates on which the recipient repaid the aid or individual instalments of aid.

Comments:

1.2. Please explain in detail how the interest payable on the amount to be recovered will be calculated.

2.

RECOVERY MEASURES PLANNED OR ALREADY TAKEN

2.1. Please describe in detail what measures have been taken and what measures are planned to bring about the
immediate and effective recovery of the aid. Where relevant, please indicate the legal basis for the measures
taken or planned.

2.2. By what date will the recovery of the aid be completed?

3.

RECOVERY ALREADY EFFECTED

3.1. Please provide the following details of aid that has been recovered from the recipient:

Concise description of
the measure

Date(s) (°)

Amount of aid repaid

Currency

Date(s) of
repayment (°°)

(°) Date or dates on which the aid or individual instalments of aid were put at the disposal of the recipient.
(°°) Date or dates on which the aid was repaid.

3.2. Please attach supporting documents for the repayments shown in the table at point 3.1.