2005/238/: Commission Decision of 14 July 2004 concerning aid granted to the fisheries and aquaculture sector in Corsica from 1986 to 1999 (notified under document number C(2004) 2585)Text with EEA relevance
Date: 2004-07-14
Institutions: European Commission
Subjects: France, State aid, aquaculture, control of State aid, fishing industry, fishing vessel

19.3.2005

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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 14 July 2004

concerning aid granted to the fisheries and aquaculture sector in Corsica from 1986 to 1999

(notified under document number C(2004) 2585)

(Only the French text is authentic)

(Text with EEA relevance)

(2005/238/EC)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

(4)

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

Having called on interested parties to submit their comments in
accordance with the above provision,

Whereas:

I. PROCEDURE

(1)

(2)

(3)

certain economic

A meeting was held in Brussels on 21 May 1996
between France and the Commission concerning the
situation of
in Corsica,
including the fisheries sector. The Commission learned
during this meeting that public aid had been granted
to the sector without it having been notified to permit
its examination in accordance with Article 93 (now
Article 88) of the Treaty.

sectors

By letter dated 14 June 1996, the Commission asked
France to provide details of this aid.

By letter dated 7 July 1996, France informed the
Commission that it had asked the authorities in Corsica
to forward the
the
Commission did not receive this information, a first
reminder was sent on 12 September 1996.

information requested.

Since

(5)

(6)

(7)

Subsequently, by letter dated 17 December 1996, France
sent certain information concerning the aid in question.
The aid was entered in the register of unnotified aid
under number NN 11/97 on 6 January 1997.

Having found that it did not have all the information
necessary to examine the aid scheme, the Commission
requested additional information by letter dated 24 April
sent by letters dated 3
1997. Documentation was
December 1997 and 11 August 1998.

The Commission then made a new request for further
information by letter dated 11 February 1999. A meeting
was then held at the Commission on 22 February 2000
with representatives of
authorities of Corsica.
the
the Commission again sent
Following this meeting,
France a list of the information it needed to analyse
the aid measures. After a further two reminders, a large
part of the information required arrived by letter dated
11 April 2001.

and the management of public

In addition, the Commission was informed of Report No
1077 of the French National Assembly drawn up in the
name of the Committee of Inquiry into the use of public
funds
in
Corsica (1)
(hereinafter referred to as the report of the
National Assembly). The report, published in 1998,
describes the aid granted to the fisheries and aquaculture
sector in 1997 (see point I.C.1.b of the report).

services

(1) Report available on the Internet site of

the National Assembly:

http://www.assemblee-nationale.fr/dossiers/corse.asp

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(8)

The Commission informed France by letter dated 30
October 2001 of its decision to initiate the formal inves-
tigation procedure provided for in Article 88(2) of the
Treaty against the following aid measures implemented
in Corsica:

— aid for purchasing new and second-hand vessels for

the whole period from 1986 to 1999,

(14)

— aid for converting and equipping existing vessels
during the period from 1 January 1987 to 28
October 1998 where the work carried out resulted
in increased engine power.

By the same decision, the Commission informed France
that it had decided to regard as being compatible with
the common market aid for converting and equipping
vessels where the work carried out did not result in
any increase in the power of
the vessel and aid for
shore facilities for fishermen.

By this decision, the Commission also requested France
information necessary for
to provide
examining the aid for aquaculture.

it with the

By letter dated 21 December 2001, France submitted
comments concerning the aid regarding which the
formal
investigation procedure had been initiated and
provided information on the aid for aquaculture.

(15)

Journal of

The decision to initiate the procedure was published in
the European Communities (1). The
the Official
Commission called on the interested parties to submit
their comments on the aid in question. The Commission
the
received no comments
decision.

following publication of

II. DESCRIPTION

(9)

(10)

(11)

(12)

(13)

— aid for purchasing second-hand vessels for the period

from 1986 to 1999,

— aid for aquaculture for the period from 1994 to

1999.

the fishing fleet was instituted by the
The aid for
Assembly of Corsica, which, on 29 March 1985,
adopted Decision 85/10a ‘on aid for the modernisation
the fleet’. This Decision was amended on several
of
occasions: Decision 90/99 of 30 November 1990,
Decision 91/1032 of 19 December 1991, Decision
93/25 of 23 February 1993, Decision 95/16 of 9
March 1995, Decision 95/79 of 11 September 1995
and Decision 97/36 of 11 April 1997. France stressed
that the most recent of those Decisions (97/36) was not
the programming period
amended until
(SPD)
covered by the single programming document
concerning Structural Fund measures in force at
the
time,
i.e. until 31 December 1999. As regards the aid
for aquaculture, France stated that the regional authorities
in Corsica applied Community legislation directly,
in
accordance with the Aid Guide published by the
Corsican Economic Development Agency (ADEC). The
part of the Guide relating to fisheries and aquaculture,
describing the aid that may be granted, was sent to the
Commission.

the end of

The aid dates back to 1985. Council Regulation (EC) No
659/1999 of 22 March 1999 laying down detailed rules
for the application of Article 93 of the EC Treaty (2) does
not lay down any limitation period for the examination
of unlawful aid within the meaning of Article 1(f)
thereof, i.e. aid implemented before the Commission is
able to reach a conclusion about its compatibility with
the common market. However, Article 15 of that Regu-
lation stipulates that the powers of the Commission to
recover aid is subject to a limitation period of 10 years,
that the limitation period begins on the day on which the
aid is awarded to the beneficiary and that that limitation
interrupted by any action taken by the
period is
Commission. Consequently,
the Commission considers
that it is pointless to examine the aid covered by the
limitation,
i.e. aid granted more than ten years before
any measure taken by the Commission concerning it.

The aid measures covered by this Decision are those for
which the formal
investigation procedure was initiated
and those for which the Commission enjoined France
therefore
information.
to
concerns the following four types of aid:

decision

provide

This

— aid for purchasing new vessels during the period

from 1986 to 1999,

— aid for converting and equipping existing vessels
during the period from 1 January 1997 to 28
October 1998 where the work carried out resulted
in increased engine power,

(16)

The Commission considers that the limitation period was
interrupted by its request for information sent to France
on 14 June 1996. Accordingly, the limitation applies to
aid granted to beneficiaries before 14 June 1986. The
limitation therefore applies, in particular, to aid granted
before 14 June 1986 by the Region of Corsica but paid
to beneficiaries only in subsequent years, after the eligible
investments had actually been made. Consequently, the
in the analysis below,
Commission takes into account,
aid granted by decisions taken between 14 June 1986
and 31 December 1999.

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

(1) OJ C 25, 29.1.2002, p. 2.

of Accession.

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Aid for purchasing new vessels

if

the

special

fishing

from Corsica

except where

(17) Decision 85/10a of 1985 laid down that aid could be
granted for the purchase of vessels of less than 18 metres
intended for
vessels
derogation was
concerned,
granted, were built in France. The subsidy was 20 % of
the purchase price, with an additional subsidy of 10 %
where it was the first purchase of a new vessel and a
further 10 % where the vessel was built in Corsica. In
addition, with the
encouraging Corsican
aim of
shipyards using traditional timber-construction methods,
the subsidy could be increased by 20 % of the purchase
price with a special contribution from the specific
the timber
funding available for
sector. The contribution from the shipowner had to be
at least 10 %.

the promotion of

(23) A subsidy of 15 % could be granted for the cost of this
equipment. Decision 93/25 increased this to 30 % of the
cost of the investment.

if

(24) Decision 95/79 did not change the rate of aid but
specified that,
the vessel applied for
the owner of
Community aid, the grant from the Corsican authorities
would be calculated in accordance with the aid rates
provided for
in the relevant Community rules. The
minimum cost above which investment is eligible was
lowered to FRF 20 000. Decision 95/79 also laid down
that,
converting or
equipping a vessel was submitted for the first purchase
of a new or second-hand vessel by a fisherman, the first
80 lengths of net could receive a 30 % subsidy.

the application for aid for

if

(18) Decision 90/99 amended the aid rates,

increasing the
basic rate from 20 % to 30 % and reducing the additional
aid of 20 % for timber construction to 5 %.

(19) Decision 95/16 amended the aid rates as follows: the
basic rate remained at 30 % and it was laid down that
the eligible investment could include the purchase of the
hull, equipment and 80 lengths of net (6 400 metres).
The aid for a first purchase remained at 10 % and the
specific aid where the vessel was built in Corsica was
reduced from 10 % to 5 %, still with an additional 5 %
in the case of timber construction. The requirement for
the vessel to be built in France was abolished.

Aid for purchasing second-hand vessels

(25) Decision 85/10a of 1985 laid down that a grant of 10 %
could be paid for the purchase of a second-hand vessel at
a price of at least FRF 50 000. An additional subsidy of
5 % could be paid for a first purchase. The purchaser had
to contribute at least 15 % of the cost of the vessel.

(26) Decision 91/1032 increased the basic rate from 10 % to
15 %. Decision 95/16 increased the rate to 20 % for
vessels less than 20 years old.

(20) Decision 95/79 restricted aid for the purchase of nets to
the first purchase of a vessel by the applicant. The
subsidy of 5 % where the vessel was timber-built in a
Corsican shipyard was also abolished.

Aid for aquaculture

(21) Decision 97/36 did not make any substantial change to
the provisions described above. It continued to stipulate
that the contribution from the shipowner had to be at
least 10 %.

between

(27) Aid for aquaculture was laid down in the 1994 planning
agreement
regional
the
governments and in the single programming document
for Community aid under Objective 1. The rules on the
Financial Instrument for Fisheries Guidance (FIFG) were
applied for the implementation of projects part-financed
by the Community.

national

and

Aid for converting and equipping vessels

(22) Decision 85/10a of 1985 laid down that the conversion
of vessels of less than 18 metres at a cost of at least
25 000 French francs (FRF) was eligible for aid where the
aim was to make a significant improvement to fishing
potential (winches, net winches, echo sounders, gantries,
navigation equipment, net rollers, etc.) and allow the
refrigerated storage of fish or improve the energy effi-
ciency of the means of propulsion (diesel engine of a
capacity suited to the size of
the vessel, adjustable
pitch propeller, nozzles, etc.).

(28) Aid for collective or private investments. Collective
fishery products,
investments cover the promotion of
market research and technical support for aquaculture
undertakings. Investments in undertakings are intended
to make aquaculture undertakings more competitive
with a view to increasing the quality of products on
the market. These
connected with
compliance with health standards and improving the
conditions for product marketing: packaging equipment,
storage facilities, service vessels, computer equipment,
ice-making machines, refrigerated vans, etc.

investments are

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(29)

The maximum rate of aid was 25 % of the investment in
order to take account of possible financing by the FIFG.

and

arrangements

Community
criteria
structural assistance in the fisheries and aquaculture
sector
its
products (10).

and the processing

and marketing of

regarding

III. REASONS FOR OPENING THE FORMAL INVESTI-

GATION PROCEDURE

(32)

The Commission expressed doubts on the compatibility
of these aid measures for two reasons.

Aid for purchasing new vessels

(30)

(31)

as

to

referred

(hereinafter

aquaculture

The Commission based its decision to open the formal
investigation procedure on the various versions of the
Guidelines for the examination of State aid to fisheries
and
the
Guidelines). According to point 3.4 of
the 2001
Guidelines (1), currently in force, unlawful aid must be
examined in the light of
the Guidelines applicable
when it is granted. In 1986 and 1987, the Guidelines
applicable were those published in 1985 (2). Subse-
the Guidelines applicable were the following:
quently,
those published in 1988 (3)
for aid granted from 1
for aid
January 1989,
granted from 1 July 1992, those published in 1994 (5)
for aid granted from 1 January 1995 and those published
in 1997 (6) for aid granted from 1 January 1997.

those published in 1992 (4)

in particular as

restructuring, modernising

The Commission also referred to the successive Council
Regulations concerning Community structural measures
in the fisheries and aquaculture sector, to which these
Guidelines constantly refer,
regards
eligible investments and permissible aid rates. These regu-
lations are as follows: Council Regulation (EEC) No
2908/83 of 4 October 1983 on a common measure
for
the
fishing industry and for developing aquaculture (7),
Council Regulation (EEC) No 4028/86 of 18 December
1986 on Community measures to improve and adapt
in the fisheries and aquaculture sector (8),
structures
Council Regulation (EC) No 3699/93 of 21 December
and arrangements
1993 laying down the
in the
assistance
regarding Community
fisheries and aquaculture sector and the processing and
marketing of its products (9) and Council Regulation (EC)
No 2468/98 of 3 November 1998 laying down the

criteria
structural

and developing

(1) OJ C 19, 20.1.2001, p. 7.
(2) OJ C 268, 19.10.1985, p. 2.
(3) OJ C 313, 8.12.1988, p. 21.
(4) OJ C 152, 17.6.1992, p. 2.
(5) OJ C 260, 17.9.1994, p. 3.
(6) OJ C 100, 17.3.1997, p. 12.
(7) OJ L 290, 22.10.1983, p. 1. Regulation as last amended by Regu-

lation (EC) No 3733/85 (OJ L 361, 31.12.1985, p. 78).

(8) OJ L 376, 31.12.1986, p. 7. Regulation as last amended by Regu-

lation (EC) No 3946/92 (OJ L 401, 31.12.1992, p. 1).

(9) OJ L 346, 31.12.1993, p. 1. Regulation as last amended by Regu-

lation (EC) No 25/97 (OJ L 6, 10.1.1997, p. 7).

(33)

to

achievement

that aid for

Firstly, based on the Guidelines, the Commission pointed
the purchase of new vessels was
out
if granted for
compatible with the common market
investments
the
of
contributing
objectives of the multiannual guidance programme for
the fishing fleet (MAGP), which sets out a number of
requirements and a list of
the means necessary for
their fulfilment, in particular adjustment of the capacity
of the fishing fleet of each Member State in line with the
fishery resources to which it has access. However, France
did not achieve the objective set out in MAGP III (11), in
force from 1992 to 1996. It accordingly had to stop
granting aid for the construction and modernisation of
fishing vessels as from 1 January 1997. Subsequently, by
letter dated 28 October 1998,
the Commission told
France that it could restart granting investment aid on
certain conditions. In its letter dated 30 October 2001
informing France of its decision to initiate the formal
investigation procedure, the Commission assumed that
the aid granted from 1 January 1997 to 28 October
1998 infringed the Guidelines applicable over
that
period.

(34)

Secondly, the Commission noted that, given the possible
aid rates and the possibility of cumulation with aid under
other schemes,
the aid had exceeded the maximum
permissible rate.

Aid for converting and equipping vessels

(35)

The Commission expressed doubts regarding the compa-
tibility of the aid granted from 1 January 1997 to 28
October 1998 for converting and equipping vessels
where the work carried out resulted in an increase in
the vessel’s engine capacity since,
in the same way as
for aid for purchasing vessels, aid of this kind did not
contribute to achieving the objectives of the MAGP.

(10) OJ L 312, 20.11.1998, p. 19.
(11) Commission Decision 92/588/EEC of 21 December 1992 on a
multiannual guidance programme for the fishing fleet of France
for the period 1993 to 1996 pursuant
to Council Regulation
(EEC) No 4028/86 (OJ L 401, 31.12.1992, p. 3). Decision as last
amended by Decision 95/238/EC (OJ L 166, 15.7.1995, p.1).

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(36)

(37)

(38)

Aid for purchasing second-hand vessels

The Commission expressed doubts regarding the compa-
tibility of some of the aid granted for purchasing second-
hand vessels from 1 January 1989 because the Decision
of the Assembly of Corsica provided for the possibility of
granting such aid for purchasing vessels without any
maximum age limit although the 1988 Guidelines,
applicable at that time, prohibited aid for vessels more
than 15 years old, reduced to 10 years by the 1992
Guidelines, applicable
from 1 July 1992, and the
subsequent Guidelines.

In addition, the Commission informed France that the
1998 Guidelines and subsequent Guidelines stipulated
that aid for purchasing second-hand vessels could be
granted only in the event of first purchases by young
fishermen or possibly the acquisition of part-ownership
or the replacement of a vessel following total loss. It also
pointed out that, given the possible aid rates and the
possibility of cumulation with aid under other schemes,
the aid might have exceeded the maximum permissible
rate.

IV. COMMENTS SUBMITTED BY FRANCE

In its reply, France gave a detailed explanation of the
reasons why the aid granted had not, in fact, exceeded
including where there had been
the permissible rates,
in particular
cumulation with aid from other sources,
Community
it
arguments,
In support of
enclosed a copy of the Aid Guide drafted by ADEC.

aid.

its

(39)

the age requirements for
France also explained that
vessels for the purposes of aid for purchasing second-
hand vessels, as laid down in the Guidelines, had been
included in the Guide and had been respected.

(40)

France also forwarded to the Commission, along with its
comments following the opening of the formal investi-
gation procedure, information on aid granted for aqua-
culture required by the ‘injunction to provide infor-
mation’ contained in the Commission letter dated 30
October 2001.

(42)

(43)

(44)

takings are sold on the Community market, the measures
strengthen the position of those undertakings, both on
the French market compared with undertakings from
other Member States wanting to introduce their own
products onto that market and on the market of the
other Member States
compared with undertakings
selling their products on those markets. Consequently,
these measures distort or threaten to distort competition.
They constitute State aid within the meaning of Article
87(1) of the Treaty.

These measures can be considered compatible with the
common market only if eligible for one of the dero-
gations provided for
in the Treaty. Since this aid
benefits undertakings in the fisheries and aquaculture
from the derogation
sector,
the
provided for,
exceptions provided for by the Guidelines (the various
versions of
these which have been applicable since
1986 are listed in recital 30).

they must correspond to one of

to be able to benefit

Aid for purchasing new vessels (1986-1999)

In its comments, France explained that the maximum aid
rates had been respected. The Commission notes that the
Aid Guide drafted by ADEC states that the maximum
rate must not exceed the rate provided for in the Regu-
lation on structural measures financed from the FIFG.
This aid is,
in this respect, therefore compatible with
the common market, subject to what is stated below.

There remains, however, the problem of aid granted over
the period from 1 January 1997 to 28 October 1998 in
view of the obligation on France to stop paying aid for
constructing or modernising vessels under the rules of
the common fisheries policy, which was lifted by letter
dated 28 October 1998 (1). In its letter dated 30 October
2001 informing France of the opening of the formal
investigation procedure, the Commission assumed that
aid had been granted during this period. This hypothesis
was based on two factors: firstly, the fact that, according
to France’s letter dated 11 April 2001, Assembly of
Corsica Decision 97/36 had not been amended, which
meant that the Decision had been applied continuously
from the date of its adoption until the end of 1999 and,
the National
secondly,
Assembly expressly stated that aid had actually been
granted for constructing vessels in 1997 (point I.C.1.b
of the report).

the report of

the fact

that

V. ASSESSMENT

(45)

It would be useful to quote an extract from the report of
the National Assembly:

(41)

The aid measures in question confer a financial advantage
on a category of undertakings carrying out a specific
activity,
resources
necessary for implementing these measures are public
resources. Since the products of the beneficiary under-

aquaculture. The

fishing or

i.e.

‘…. — aid for fisheries and aquaculture:

(1) See recital 33.

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…. In 1997, ADEC processed 114 applications submitted
by both private undertakings, for the purposes of moder-
nising the fleet and aquaculture… Of the 114 appli-
cations processed, only 16 were rejected.

(49)

the applications

In total,
resulted in aid from the
Corsican authorities of more than FRF 13 million,
made up of FRF 11,5 million as investment aid and
FRF 1,6 million as operating aid. Almost half of the
aid granted for investments was for modernising the
fleet.

In 1997, 10 fishing vessels were constructed, …’.

France made no comment regarding the assumption
made in the Commission’s letter dated 30 October
2001, neither stating, for example, that application of
Decision 97/36 had been suspended nor that no aid
is
had been granted during the period concerned.
therefore safe to assume that aid was actually granted
during that period.

It

(50)

fleet

in order

resulting
in July 1996,

By letter dated 8 August 1997, France replied, indicating
‘At the beginning of 1996, the inter-
in particular that:
mediate objectives of MAGP II not having been achieved
by 31 December 1995,
the French authorities had
already taken the necessary steps to freeze investment
projects
In
in increased
capacity.
addition,
to accelerate the
reduction in the fishing fleet, a plan for the withdrawal
of fishing vessels from the fleet was implemented…, the
from the fleet of
the withdrawal
plan provided for
between 10 000 kW and 15 000 kW. Therefore, at the
beginning of 1997, France thought it would be able to
its objectives under MAGP III. Consequently,
fulfil
authorisation was
of
investment, accompanied by national aid, essentially in
cases where there was an urgent need to replace vessels
or fit new engines… However, the full effects of the
withdrawal measures were seen only at the end of the
first half of 1997…’.

given for

volumes

limited

In fact,
it was only in the second half of 1998 that
France was able to achieve the objectives of the MAGP.
By letter dated 28 October 1998,
the Commission
‘following our meeting of 21
informed France that
October 1998, our previous meetings and the clarifi-
cations contained in your
letters dated 5 and 22
I have the pleasure to announce that
October 1998,
the Directorate-General
a
Fisheries
for
resumption of investments such as you envisage, i.e, in
a very measured manner, giving priority to young
fishermen, without increasing capacity and in compliance
with the objectives of the MAGP’.

can accept

(46)

(47)

that

investments

the MAGP (1). More specifically,

The successive versions of
the Guidelines consistently
stipulated that aid for purchasing new vessels was
compatible with the common market if it was granted
contributed to achieving the
for
for aid
objectives of
granted from 1 January 1997 to 28 October 1998, to
which the 1997 Guidelines applied, point 2.2.3.1 of
those Guidelines laid down that ‘Aid for the construction
of new fishing vessels may be deemed to be compatible
with the common market subject to the requirements of
Articles 7 and 10 and Annex III
(paragraph 1.3) of
Regulation (EC) No 3699/93 […].’

(48) Article 10(1) of Regulation (EC) No 3699/93 lays down
that ‘Member States may take such measures to promote
the construction of fishing vessels as comply with the
global annual
intermediate objectives and the final
objectives by segment under their multiannual guidance
programme within the stated time limits. Member States
shall, when forwarding any pertinent aid proposal,
inform the Commission of provisions taken to ensure
condition is
that
that
this
the Commission reminded France by letter
provision,
dated 4 July 1997, that ‘it must therefore stop granting
aid for construction or modernisation as from 1 January
1997’.

complied with.’ Under

(1) See recital 33.

(51)

It can be seen from this exchange of correspondence that
France was perfectly aware that it was not achieving the
intermediate objectives of MAGP III and that, despite this,
aid for purchasing new vessels was authorised. The
requirements laid down in Article 10 of Regulation
therefore fulfilled. Conse-
(EC) No 3699/93 was not
quently, under point 2.2.3.1 of
the 1997 Guidelines,
the aid granted during that period for purchasing new
vessels was incompatible with the common market.

Aid for converting and equipping vessels (1 January
1997 to 28 October 1998)

(52)

the formal

The opening of
investigation procedure
concerned aids for converting and equipping vessels
granted during the period from 1 January 1997 to 28
October 1998 where the work carried out increased the
power of the vessel, because, as in the case of the aid for
purchasing new vessels, such aid did not contribute to
achieving the objectives of the MAGP.

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(53)

The report of the National Assembly (point I.C.1.b) refers
to aid for modernising vessels. As well as stating that ten
fishing vessels had been built, the report also said that ‘…
38 vessels have undergone various types of alterations
and re-equipping…’.
is therefore clear that aid for
modernising vessels was granted during the period.

It

(58)

In addition, with regard to the requirement to restrict
such aid to first purchases by young fishermen and the
replacement of vessels following total
loss, France also
indicated in its reply dated 21 December 2001 that this
aid was granted in accordance with the Community
provisions
this aid can be
deemed to be compatible with the common market.

in force. Consequently,

(54)

The successive Decisions adopted by the authorities of
the Region of Corsica expressly stipulated that aid could
be granted for fitting ‘an engine of a capacity suited to
the size of the vessel’. This appears to indicate that aid
for modernising vessels could be granted for purchasing
a more powerful engine. In addition, as in the case of aid
for purchasing vessels,
France made no comment
regarding the assumption made in the Commission’s
letter dated 30 October 2001 that aid for purchasing
an engine more powerful than an existing engine was
granted during the period.
therefore safe to
assume that aid for modernising vessels was actually
granted in certain cases where the work carried out
resulted in increased engine power.

is

It

(55) As in the case of aid for construction, point 2.2.3.2 of
the 1997 Guidelines stipulates that ‘Aid for the moder-
commissioned vessels may be deemed
nisation of
compatible with the common market subject
to the
requirements of Articles 7 and 10 of, and Annex III
(paragraph 1.4) to, Regulation (EC) No 3699/93 [… ]’.
Article 10(2), of Regulation (EC) No 3699/93 lays down
that ‘Member States may take measures to promote the
modernisation of fishing vessels. Such measures shall be
subject
to the conditions referred to in paragraph 1
(construction of vessels) where investments are likely to
result in an increase in fishing effort’.

(56)

The requirement laid down in Article 10 of Regulation
therefore fulfilled. Conse-
(EC) No 3699/93 was not
quently, under point 2.2.3.2 of
the 1997 Guidelines,
aid granted during that period for modernising vessels,
where modernisation resulted in increased power, was
incompatible with the common market.

Aid for purchasing second-hand vessels (1986-1999)

(57) As already indicated in recital 39, France provided infor-
mation showing that the age requirement had actually
been respected. The doubts expressed on this subject
by the Commission in opening the formal investigation
procedure have therefore been dispelled. The same holds
for the maximum possible rate of aid.

Aid for aquaculture (1994-1999)

(59)

In accordance with the successive versions of
the
Guidelines, aid for aquaculture is compatible with the
common market where the requirements laid down in
the Regulation on Community structural measures in the
fisheries sector are fulfilled.

(60) As France indicated in its letter dated 21 December
2001, the Aid Guide took account of those requirements,
stipulating in particular that the maximum authorised aid
rate must take account of aid from other sources.

(61) Accordingly,

the aid granted for aquaculture can be

deemed to be compatible with the common market.

VI. CONCLUSIONS

(62)

The following State aid implemented in the Region of
Corsica in France by Decision of the Assembly of Corsica
85/10a of 29 March 1985, as amended by Decision
90/99 of 30 November 1990, Decision 91/1032 of 19
December 1991, Decision 93/25 of 23 February 1993,
Decision 95/16 of 9 March 1995, Decision 95/79 of 11
September 1995 and Decision 97/36 of 11 April 1997
is incompatible with the common market:

— aid for purchasing new vessels granted during the
period from 1 January 1997 to 28 October 1998,

— aid for converting and equipping existing vessels
granted during the period from 1 January 1997 to
28 October 1998 where the work carried out
resulted in increased engine power.

(63)

In accordance with Article 14 of Regulation (EC) No
659/1999, France must recover the aid concerned.

L 74/48

EN

Official Journal of the European Union

19.3.2005

(64)

The following aid is compatible with the common
market:

(a) aid for purchasing new vessels granted outside the period

from 1 January 1997 to 28 October 1998;

— aid for purchasing new vessels granted outside the
period from 1 January 1997 to 28 October 1998,

— aid for converting and equipping existing vessels
granted outside the period from 1 January 1997 to
28 October 1998 or granted during that period
in
where the work carried out did not
increased engine power,

result

(b) aid for converting and equipping existing vessels granted
outside the period from 1 January 1997 to 28 October
1998 or granted during that period where the work
carried out did not result in increased engine power;

(c) aid for purchasing second-hand vessels;

(d) aid for aquaculture granted from 1994 to 1999.

— aid for purchasing second-hand vessels,

Article 3

— aid for aquaculture,

HAS ADOPTED THIS DECISION:

Article 1

and introduced by Decision of

The following aid measures implemented by France in the
Region of Corsica
the
Assembly of Corsica 85/10a of 29 March 1985, as amended
by Decision 90/99 of 30 November 1990, Decision 91/1032 of
19 December 1991, Decision 93/25 of 23 February 1993,
Decision 95/16 of 9 March 1995, Decision 95/79 of 11
September 1995 and Decision 97/36 of 11 April 1997 are
incompatible with the common market:

(a) aid for purchasing new vessels granted during the period

from 1 January 1997 to 28 October 1998;

(b) aid for converting and equipping existing vessels granted
during the period from 1 January 1997 to 28 October
1998 where the work carried out resulted in increased
engine power.

1.
France shall take all measures necessary to recover from
the beneficiaries the aid referred to in Article 1 that was
unlawfully granted to them.

Recovery

shall be

effected without delay

and in
2.
accordance with the procedures of national law provided that
they allow the immediate and effective execution of
this
Decision. The aid to be recovered shall
include interest from
the date on which it was granted to the recipient until the date
of
Interest shall be calculated and applied in
accordance with Chapter V of Commission Regulation (EC)
No 794/2004 (1).

its recovery.

Article 4

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

Article 5

This Decision is addressed to the French Republic.

Article 2

Done at Brussels, 14 July 2004.

The following aid measures implemented by France in the
Region of Corsica and introduced by the Decision of
the
Assembly of Corsica referred to in Article 1 are compatible
with the common market:

For the Commission

Franz FISCHLER
Member of the Commission

(1) OJ L 140, 30.4.2004, p. 1.