2008/936/EC: Commission Decision of 20 May 2008 concerning aid granted by France to the Fund for the prevention of risks to fishing and fisheries undertakings (State aid C 9/06) (notified under document number C(2007) 5636) (Text with EEA relevance)
Date: 2008-05-20
Institutions: European Commission
Subjects: State aid, control of State aid, economic support, exchange of information, fishing industry, motor fuel

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(Acts adopted under the EC Treaty/Euratom Treaty whose publication is not obligatory)

II

DECISIONS

COMMISSION

COMMISSION DECISION

of 20 May 2008

concerning aid granted by France to the Fund for the prevention of risks to fishing and fisheries
undertakings (State aid C 9/06)

(notified under document number C(2007) 5636)

(Only the French text is authentic)

(Text with EEA relevance)

(2008/936/EC)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty
Community,
and in particular
Article 88(2) thereof,

establishing the European
subparagraph of
the

first

Having called on the parties concerned to submit
comments under that Article,

their

Whereas:

(1)

(2)

1. PROCEDURE

The Commission was aware of information relating to
the existence of a fund intended to compensate for the
rise in the price of fuel affecting French fisheries under­
takings since 2004. According to that information, the
declared objective of the fund, called the Fund for the
prevention of risks to fishing (FPAP), was to even out
short-term variations in the price of fuel for the fishing
industry, but in practice it enabled the undertakings to
benefit from a fuel price much lower than the market
price.

Apparently it was planned, at the beginning, for the Fund
to operate solely on the basis of contributions from the
trade. The operating principle would have been simple:
the Fund would have borne that part of the cost of fuel
higher than a specified reference price per litre and, in
return, the undertakings would have paid contributions
to the FPAP when the price of fuel fell back to below the

(3)

(4)

(5)

reference price. In this way, a balance for financing the
system would have been struck without there being any
contribution from public funds.

the

above

considerably

However, since the market price for fuel always stayed
very
the
Commission took the view that operation of the FPAP
was only possible as a result of the financial contribution
from the State and that
financial contribution
constituted State aid within the meaning of Article 87
of the EC Treaty.

reference price,

that

On 25 August 2005 the Commission requested France to
inform it, by 5 September 2005, whether
specific
measures had been adopted or were envisaged by the
State
costs. The
Commission also pointed out
if such measures
involved State aid it had to be notified of them under
Article 88(3) of the Treaty.

to counter

increase

in fuel

that

the

In the absence of a reply, and in accordance with
Article 10 of Council Regulation (EC) No 659/1999 of
22 March 1999 laying down detailed rules for the appli­
cation of Article 93 (now Article 88) of the EC Treaty (1),
on 21 September 2005 the Commission requested
France to provide it, within three weeks, with infor­
to be able to
mation on the Fund in order for it
examine whether it actually involved State aid and,
if
so, whether or not that State aid was compatible with
the common market.

(1) OJ L 83, 27.3.1999, p. 1.

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(6)

On 7 October 2005 France replied to the Commission’s
request of 25 August 2005, stating that ‘no measure
under the State aid scheme has been implemented in
the difficulties due to the recent
France to counter
fuel’. However,
considerable increase in the price of
France pointed out that it had encouraged ‘an initiative
taken by the trade’ consisting of the creation of a fund
for the prevention of risks to fishing. No mentioned was
made in that correspondence of the advance payments
it was implicit
granted by the State. On the contrary,
from the French authorities’ reply that the financing of
the Fund, managed by the trade, was based exclusively on
the pooling of the members’ financial capacity.

(11)

The Commission decision to initiate the formal investi­
gation procedure was published in the Official Journal of
the European Union of 19 April 2006 (2). The Commission
called on interested parties to submit their comments on
the measures in question within one month.

(7)

On 21 October 2005 the Commission reminded the
French authorities of its formal request for information
on the FPAP of 21 September 2005, granting them a
new two-week deadline.

(12)

France submitted its comments on 21 April 2006 in the
form of a note from its authorities. That note is accom­
panied by a list of defensive points which seems to have
been originally intended for internal use; the list explains
the position to be taken vis-à-vis the Commission’s
arguments.

(8)

(9)

In the absence of a reply from France within the time
in accordance with
limit set, the Commission decided,
paragraph 3 of Article 10 as referred to above, to issue
France with an injunction to provide the information
necessary for the examination. That
injunction, dated
5 December 2005, was sent on 6 December 2005
with a three-week deadline for reply.

France replied by letter dated 21 December 2005 and
received by the Commission on 27 December 2005.
That letter referred back to a previous reply, dated 6
December and received on 8 December, sent in reply
to the Commission’s letter of 21 September 2005 (see
recital 5 of this Decision). In those two letters France
forwarded the Commission the FPAP’s articles of associ­
ation and the three agreements on the introduction of a
repayable State advance to the FPAP.

(10) After

replies

examining these

and the documents
enclosed, on 8 March 2006 the Commission informed
France of its decision to initiate the formal investigation
procedure provided for in Article 88(2) of the EC Treaty
and Article 6 of Regulation (EC) No 659/1999.

and received by

also dated 17 May

(13) On 17 May 2006 Ménard, Quimbert et associés, a law
firm in Nantes (‘MQA’ in the following) sent a fax indi­
cating their intention to make comments on behalf of
the FPAP at a later date, and accordingly requested that
they be granted time to do so. The Commission accepted
an extension of two weeks. MQA then forwarded, by
ordinary post dated 17 May received by the Commission
on 23 May, a statement under the letterhead of Coopé-
ration Maritime signed by Mr de Feuardent, the Secretary-
General of the FPAP, dated 18 May. A third letter from
MQA,
the
Commission on 14 June, was ‘a new version of [its]
comments following correction of a number of clerical
errors’. In reality these were documents not previously
forwarded to the Commission comprising additional
statement by Mr de
comments
Feuardent
to the
accompanied by a number of
referred to above,
the FPAP
documents
relating to the operation of
information
(articles of association, rules of procedure,
notes,
tax treatment of contributions, and a letter
relating to a joint audit by the Inspectorate-General for
Finance and the Inspectorate-General for Agriculture and
Fisheries). Finally,
from MQA, dated
12 June 2006 and sent to the Commission the same
day by fax,
following on from its letter of 19 May
‘dated 17 May by mistake, sending [you] the comments
made by Mr de Feuardent, Secretary-General of
the
Confédération de la Coopération, de la Mutualité et du
Crédit Maritime, dated 18 May 2006’ contained the same
additional comments as those sent by the third letter of
17 May, but without the accompanying documents.

the last

letter

(2) OJ C 91, 19.4.2006, p. 30.

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(14) On 14 June 2006 the Commission sent France the third
letter
from MQA of 17 May 2006 (the version
announced as correcting the clerical errors) and MQA’s
last letter of 12 June 2006, requesting France to send its
comments to reach it within one month. On 12 July
2006 France requested an extension of the deadline to
1 September. On 18 July 2006 the Commission accepted
an additional period of one month. On 26 September
2006 France replied that it had no particular comments
the MQA letter of
to make, but pointed out
17/19 May 2006 did not tally with Mr de Feuardent’s
comments. On 9 October 2006 the Commission gave
France details of the correspondence received from MQA
and requested it to confirm within ten days that the
French authorities had indeed been aware of Mr de
Feuardent’s statement. France replied on 23 October
2006 that it did not have the statement, which it had
in fact only mentioned previously because the letter
(from MQA) dated 12 June mentioned it. Since France
stated that it had not received that letter, the Commission
officially sent it a copy on 27 October 2006, requesting
any comments that France had to be sent to it by 15
November.

that

(15) On

27 November

France
Commission that
it did not have
comments to make on the document.

2006

the
informed
any particular

2. DESCRIPTION

2.1. Presentation of the FPAP and its activities

(16)

In accordance with the French act of 21 March 1884, as
amended by the act of 12 March 1920, the FPAP is
constituted in the form of a trade association. The draft
articles of association were approved by the constituent
assembly held on 10 February 2004 and the articles of
association themselves are dated 9 April 2004.

(17) According to the articles of association (Article 4), the
association has been set up for a period of 99 years. Its
seat
the same
address as the Confédération de la Coopération, de la
Mutualité et du Crédit Maritime (‘Coopération Maritime’
in the following).

is in Paris at: 24, rue du Rocher,

i.e.

the

the

constituent

Small-Scale

industry. At

and operating material

equipment
undertakings,

for
to supply
fisheries
Fishery
Management Centre, and two persons active in the
fishing
assembly on
10 February 2004 these five founding members were
appointed administrators of the FPAP until the ordinary
general meeting to be held in 2007. Thus the FPAP
appears to have been set up by the fisheries sector and
organisations commercially involved in it
(maritime
cooperatives, central contracting agency and fisheries
undertaking management centres).

(19) Applicants for membership must provide proof that they
are active in the fishing industry. However, the associa­
tion may take in ‘any other person willing to give their
moral support
the
number of employees of this category of member does
the association’s
not exceed 5 % of
In its letter of 6 December 2005 France
members.
the FPAP has 2 013 members and
points out
2 385 vessels, accounting for 30 % of the French fleet.

to the association’, provided that

the number of

that

(20) Article 2 of the articles of association states that:

‘The
purpose of the association is to develop products so as to
enable fisheries undertakings to cover the following risks:
fluctuations in the price of diesel, maritime pollution or
health risks linked to pollution, the closure of quotas or a
significant reduction in fishing opportunities, and market
risks. Its title shall be the Fund for the prevention of risks
to fishing’. The FPAP is thus designed to be a mutual
insurance company providing a number of benefits for
its members in exchange for their contributions.

(21)

repayable advances

France forwarded copies of three agreements concluded
between the State and the FPAP relating to the intro­
duction of
to the Fund by the
State. The advances are paid via the Office national inter­
professionnel des produits de la mer et de l’aquaculture
(Ofimer). The first agreement, dated 12 November 2004,
covers an amount of EUR 15 million; the second, dated
27 May 2005, an amount of EUR 10 million; and the
third, dated 11 October 2005, an amount of EUR 40
million. According to these three agreements, an amount
of EUR 65 million was therefore advanced to the FPAP.

(18) Under Article 7, the founding members are the Coopé-
ration Maritime, the central contracting and development
agency Cecomer, the retail traders’ cooperative society,
which is in fact the central contracting agency of the
in particular,
maritime cooperatives whose function is,

(22) According to the list of defensive points enclosed with
the note from France of 21 April 2006 (see recital 12 of
this Decision), it is also possible that another advance of
EUR 12 million was paid to the FPAP (see recital 40 of
this Decision).

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(23) According to Article 1 of these agreements,

‘the FPAP
shall operate on the basis of contributions paid by its
members in order to cover the setting up of financial
cover against the risks resulting from fluctuations in the
price of oil and the associated administrative costs’. The
agreements show that, although under its articles of asso­
ciation it is formally conceived as having quite a wide
range of objectives as regards the benefits that it may
provide (see recital 20 of this Decision),
in reality the
FPAP restricted its activity to providing financial cover
for fisheries undertakings against the rise in the price of
fuel.

(24) Under Article 2 of the agreement of 12 November 2004,
‘the purpose of the advance shall be the setting up of a
cover mechanism against fluctuations in international oil
prices from 1 November 2004; the advance will enable
financial options to be acquired on futures markets. The
compensation paid to members of
the Fund shall
correspond to the difference in price between the
maximum price covered and the average monthly price
in the reference index for the month under consider­
ation’. Article 2 of the agreement of 27 May 2005 is
drafted almost identically: instead of the ‘setting up’ of a
it provides for the ‘continuation’ of
cover mechanism,
this mechanism and it gives 1 March 2005 as the date
from which cover will be provided for advances paid
under
to the
agreement of 11 October 2005; Article 2 provides
that,
the Fund is to continue
‘… from 1 July 2005 and until
providing cover
31 December 2005 at
least, by buying financial
options on the futures markets, up to 17 euro cent/l’.
It states that ‘the compensation paid to members of the
Fund shall be equivalent, at most, to the difference in
price between a price of 30 euro cent/l and the
average monthly reference price for the month under
consideration, where the latter is higher than 30 euro
cent/l’.

for the advance paid,

agreement. The

applies

same

this

insured. The method of calculating the allowance is
detailed in the rules of procedure.

(26) Article 3 of the agreements referred to in recital 21 states
that advances may be paid by Ofimer only after certain
supporting documents have been provided. These must
the FPAP’s governing body
include the minutes of
authorising management of the State advance and,
in
the case of the first two agreements, detailing the use
to which the advance is to be put, and a forecast
budget.
In its note dated 6 December 2005 France
confirmed that the amounts indicated, covering a total
of EUR 65 million, were actually granted to the FPAP.
That note specifies that these advances are granted ‘to
ensure the operation of the FPAP, as soon as possible,
for the period November 2004 to the end of December
2005’.

(27)

In addition, the FPAP undertakes to keep accounts so
information on how the advances
that, on request,
have been used and resources and expenditure have
been allocated
accounting
documents must be kept
for ten years and must be
made available to the various State bodies on request.

can be obtained. The

(28) Article 4 sets the interest rate at which the FPAP is to
repay the advances to Ofimer at 4,45 %. The amount of
EUR 15 million covered
of
12 November 2004 has to be repaid by 1 November
2006, the EUR 10 million covered by the agreement of
27 May 2005 by 1 May 2007, and the EUR 40 million
covered by the agreement of 11 October 2005 by 1 July
2007.

agreement

the

by

(25)

The detailed rules of procedure of the FPAP show that
this cover mechanism operates by means of guarantee
agreements between the FPAP and its member under­
takings. Members pay a registration fee of EUR 150
plus a guarantee contribution based on an estimated
quantity of fuel expressed in litres at a rate of 0,035
cent per litre of fuel. In return, the fisheries undertakings
receive an allowance determined on the basis of
the
volume consumed, up to a maximum of the volume

(29)

In view of the three (possibly four) agreements signed
between the French State and the Fund, FPAP’s activity
within the framework of the first of the objectives set out
in Article 2 of
the articles of association (to enable
fisheries undertakings to cover the risks relating to the
fluctuation in the price of diesel) is therefore two-fold:

(a)

fluctuations

to counter
in the price of oil by
acquiring options on the futures markets in the
petroleum products sector; and

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(b) to partially compensate for

cost
induced by high oil prices for the vessels of Fund
members where the fuel price exceeds a certain
threshold.

the additional

(30) As regards State aid, the Fund must be considered under
these two aspects, on the one hand where it acts as an
economic operator on futures markets, and on the other
where it compensates fisheries undertakings for part of
the costs incurred in fuel purchases with the aim of
reducing their running costs.

2.2. Reasons for initiating the formal investigation
procedure

(31)

The reasons for initiating the formal investigation were as
follows.

2.2.1. Regarding the acquisition of options on futures markets

(32)

The advance paid to the FPAP can be regarded as a short-
term loan at a rate of 4,45 %. However, the Commission
notes that the Fund has no real estate and that its current
assets are extremely small because they only come from
its members’ contributions. This is why a bank would
never have granted such a loan.

(33) As a result, the Fund is at a financial advantage compared
to other undertakings active on the same futures markets.
That advantage constitutes State aid for the Fund. None
of the provisions of Article 87 of the EC Treaty or the
guidelines which the Commission has adopted for
assessing State aid schemes allows it to be regarded as
compatible with the common market.

(34)

In addition, as a result of this activity, the FPAP’s member
fisheries undertakings can buy fuel at reduced prices. This
constitutes aid which results in a reduction of running
costs for the undertakings covered by the Fund. However,
in accordance with paragraph 3.7 of the Guidelines for
the examination of State aid to fisheries and aqua­
culture (3),
this type of operating aid, which is not
accompanied by any obligation, must normally be
regarded as being incompatible with the
common
market.

2.2.2. Regarding compensation for fisheries undertakings of
part of the costs incurred in the purchase of fuel

(35) Here also, the aid results in a reduction of running costs
for the FPAP’s member undertakings. In the same way,
none of the provisions of Article 87 of the EC Treaty or

(3) OJ C 229, 14.9.2004, p. 5.

the guidelines which the Commission has adopted for
assessing State aid schemes allows it to be regarded as
compatible with the common market. Likewise,
in
accordance with paragraph 3.7 of the guidelines for the
fisheries sector, this type of operating aid, which is not
accompanied by any obligation, must be regarded as
being incompatible with the common market.

2.2.3. Conclusion

the information in its possession,

In view of all
Commission took the view that
the
doubts
market of
FPAP itself and its member fisheries undertakings.

the
there were serious
common
compatibility with the
this aid scheme, which benefits both the

about

3. COMMENTS MADE BY FRANCE AND THE PARTIES
CONCERNED

3.1. Comments made by France

The comments made by France are set out in the reply of
21 April 2006. After that date no additional remark was
made on the arguments developed by the FPAP and
MQA.

France points out that the Commission’s analysis should
concentrate on the nature of and the conditions for
granting the advance authorised by the State and not
on FPAP’s activities.

(36)

(37)

(38)

(39)

In this respect it observes that:

— the applicable rates are higher than the reference rates
laid down by the Commission to establish the
existence of State aid in soft loans,

— the scheme cannot be regarded as State aid as long as
In this
the repayment deadlines have not passed.
respect France points out that these deadlines were
set at 1 November 2006, 1 May 2007 and 1 July
2007 respectively,

no

has

— the Commission’s argument, according to which no
bank would have granted such an advance to the
guarantee
FPAP,
mechanisms could have been introduced. France
also points out that the FPAP is the only French
trade organisation made up of fisheries undertakings
with the objective of acting on the oil futures market
and that membership of the Fund is free.

foundation,

because

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(40)

(41)

that

The Commission also notes that, in the list of defensive
points enclosed with its reply (see recital 12 of
this
‘it does not appear
Decision), France indicates
necessary to point out that it was decided to pay an
the
advance of EUR 12 million,
agreement has not been signed. Nevertheless, we
should not box ourselves into a corner. It is proposed
that
is being
it
considered’.

should be pointed out

to date

since

that

this

3.2. Comments made by the FPAP

The Commission received several letters from MQA with
various contents and sent in a disordered fashion (see
details at recital 13 of this Decision), which may be
summarised as follows: a statement under the Coopé-
ration Maritime letterhead dated 18 May 2006 signed
by the Secretary-General of
the FPAP, and additional
comments by MQA on behalf of the FPAP, accompanied
by a number of documents relating to the operation of
the FPAP (articles of association, rules of procedure,
information notes, tax treatment of contributions, and
a letter relating to a joint audit by the Inspectorate-
General
for
Agriculture and Fisheries).

for Finance and the Inspectorate-General

The FPAP also points to the total transparency of its
management: in this respect, since it does not carry
it
out any economic activity for its own account,
cannot have any impact on the relevant
futures
market. The FPAP also points out that a joint audit
is carried out by the Inspectorate-General for Finance
and the Inspectorate-General
for Agriculture and
Fisheries,

is

— the FPAP does not act on a relevant market, because
the market
exposed to
in fishery products
numerous other distortions of competition resulting
from the various national policies for implementing
the common fisheries policy. The market must
therefore be seen as a ‘mosaic of regional micro-
markets’. This intervention therefore does not affect
trade conditions. The FPAP also points out that the
assessment of competition must be seen in context
because a major part of the increase in and distortion
of the costs affecting the fishing industry is due to
‘tolls’ or
from
Community measures, which is far from the image
of a large, open market.

resulting in particular

‘penalties’

(44)

(42) An analysis of the documents received from MQA shows
that the FPAP endorses the arguments made by France,
pointing out that one cannot prejudge ‘the pure and
simple cancellation of the debt on its expiry date’ as
long as no repayment default has been established. On
the other issues, unlike France, the FPAP concentrates its
arguments not on the nature of and the conditions for
granting the aid, but on the Fund’s articles of association
and its activities.

In fact, the FPAP’s intervention is aimed at facilitating the
maintenance of fishing within a regional framework and
preventing deep-sea vessels from falling back on closer
grounds or trawlers from targeting more specific and less
energy-consuming
to protect
resources, maintain balance and safeguard the diversity
of the system by means of a phase of adaptation. In this
way, the FPAP anticipated the recovery and restructuring
plans and the planned raising of the ceiling for de minimis
aid. For
forward the
following arguments:

the FPAP puts

these reasons,

fisheries.

aim is

Its

(43)

The main arguments put forward by the FPAP to dispute
the claim that the advances granted by France constitute
State aid and are incompatible with the common market
may be summarised as follows:

— it is not accurate to say that the advances granted by
the State were without any conditions attaching. On
the contrary, they ‘were subject to the condition that
there was immediate transparent management [and]
above all that a sustainable policy was laid down
which was subject to general inspection’,

— the FPAP is not an ordinary economic operator,
because it is a trade association acting exclusively in
the interest of its members with no profit motive and
set up as a ‘prevention group’. Thus, when it
organises the pooling of risks with a compensation
system based on a reference price, it is not acting as
an ordinary commercial operator, ‘but as a union of
consumers of petroleum products seeking more to
protect
to
operate on it’.
Initially it was designed to be self-
sufficient in theory since it was envisaged that contri­
butions paid in but not used could be reimbursed.

the market

themselves

against

that

— just above one third of

its intervention (EUR 25
million out of EUR 65 million) related directly to
advances
to employees and can be regarded as
direct social assistance,

— the aid is the result of an extraordinary situation since
the sector’s

the Commission itself acknowledges
exceptional economic and social difficulties,

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— the FPAP points out that it bears civil liability under
French law and that its liability is unlimited. For this
reason, given the lack of default on repayment, the
criterion applied by the Commission to regard this
assistance as State aid is insufficient.

monthly reference price is laid down by the FPAP.
The compensation paid by the FPAP to the fisheries
undertakings for the purchase of fuel is analysed later
on in Section 4.2 of this Decision.

(45)

(46)

together with its comments MQA forwarded
Lastly,
copies of two letters from the minister responsible for
the budget to the FPAP showing that the FPAP and all its
members benefit from tax schemes. In the case of the
FPAP these consist of exemption from corporation tax
and, probably, business tax and, in the case of fishermen-
owners,
the possibility of deducting the contributions
paid to the trade association from their taxable income.

4. ASSESSMENT

them at

This Decision does not relate to the tax advantages
referred to in recital 45, since the Commission was not
the time it decided to initiate the
aware of
formal
investigation procedure. Those tax advantages
are the subject of a special assessment, under case
number NN 38/07, to determine whether they constitute
State aid and, if so, whether that aid is compatible with
the common market.

(47)

In relation to State aid, the objective of the FPAP has to
be considered in two ways:

(48)

(49)

— firstly,

it is aimed at acquiring financial options on
the futures markets. Although this is not explicitly
stated,
those futures markets are obviously the
markets for oil or oil by-products. Thus the FPAP,
association,
while being constituted as
operates on these futures markets by acquiring
options, as any ordinary private company active on
this kind of market and operating according to the
rules of the market economy would do. The aid for
the acquisition of options on the futures markets is
assessed later on in Section 4.1 of this Decision;

trade

a

— secondly, the FPAP is aimed at paying to its member
fisheries undertakings
the difference between the
average monthly reference price and, according to
the agreements of 12 November 2004 and 27 May
2005, the ‘maximum price covered’ or, according to
the agreement of 11 October 2005, a price of 30
euro cent per litre if the average monthly price in the
reference index is higher than that price. The average

4.1. Aid for the FPAP: aid for the acquisition of
options on the futures markets

4.1.1. Existence of State aid

4.1.1.1. T h e F P A P i s a n u n d e r t a k i n g w i t h i n
t h e

t h e m e a n i n g o f A r t i c l e 8 7 o f
E C T r e a t y

It is essential in the first place to establish whether the
FPAP can be regarded as an undertaking. If that is not the
case, Article 87(1) does not apply to the FPAP. On this
question, the Commission points out that, as has been
consistently held in case law, in the context of compe­
tition law the concept of an ‘undertaking’ covers any
entity engaged in an economic activity, regardless of
the legal status of the entity or the way in which it is
financed (4). Any activity consisting in offering goods and
services on a given market is an economic activity (5).

companies

futures markets

Companies active on the futures markets for raw material
functioning
products are usually private
according to the rules of the market economy. The aim
of operations carried out on these futures markets is, for
the operator, to bet on the expectation that the purchase
price of the product, if it is acquired in the future at the
normal market price, will be different from the price at
which the option is subscribed. Thus, an operator active
on such a market takes a risk because of the uncertainty
of price changes. In the case in point, the FPAP actually
for
acted as an operator on the
also an
petroleum products. By doing this,
economic operator
since it
in the fisheries
provides the Cecomer company, a founding member
and administrator of
central
the
contracting agency for maritime cooperatives, with fuel
at a price different from that which that company would
buy at
the operation to
acquire options, which is an operation of a speculative
nature, is successful, the price of the fuel resold to the
cooperatives is lower than the market rate. The FPAP
thus takes a risk, hoping that it will be able to draw
financial advantage from it. The maritime cooperatives,
for their part, then sell on their fuel to the fisheries
undertakings at a price depending on the price at
which they were able to acquire it from Cecomer. The

the normal market price.

is
it
sector,

and the

FPAP

If

(4) Judgment of the Court of Justice in Joined Cases C-159/91 and C-

160/91 AGF-Cancava [1993] ECR I-637.

(5) Judgment of the Court of Justice in Case C-222/04 Cassa di Risparmio

[2006] ECR I-289.

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for

the

of
the

the
fuel

operations
acquired by the

transferring
characteristics
ownership of
FPAP to
Cecomer, the retail traders’ cooperative society, are not
known. However, and although Cecomer is a founding
member of the FPAP, this involves operations carried out
between two independent entities. These fuel ownership
transfer operations are of a contractual nature. This is
because, although they probably display specific charac­
teristics, the agreements under which these operations are
carried out are nonetheless private-law agreements and
consequently private-law contracts. The FPAP’s activity,
thus consisting of intervention on the futures markets
for petroleum products in order to buy those products
with a view to selling them on to Cecomer, a commercial
company, is evidently an activity of an economic nature.
Also,
the
in its Decision to initiate the procedure,
Commission observed that: ‘The purpose of the FPAP is
to enable the acquisition of
financial options on the
futures markets. Although this is not explicitly stated,
those futures markets are obviously the markets for oil
or oil by-products. Thus
FPAP, while being
constituted as a trade association, operates on these
futures markets by buying and selling options, as any
ordinary private company active on this kind of market
and operating according to the rules of
the market
economy would do’.
In their replies, France and the
FPAP did not dispute the fact that the FPAP undertook
such operations of buying and selling options. France
does not make any comments on this. As regards the
FPAP, it merely points out that ‘the FPAP operated on the
world commodities market with specialised brokers or
financial
It is difficult to imagine a more
competitive, more extensive or more volatile market.
enjoy any tariff
Fund did not
Consequently,
advantage, nor any special conditions vis-à-vis all the
on the market…. The
other operators
question
the funds
therefore comes down to the source of
advanced…’.
question the
therefore
Commission’s claim that it acts as an ordinary operator
on these futures markets. It should also be noted that the
function of the FPAP is by no means that of a public
fund administrator acting in the public interest. Neither
can it be regarded as an instance of the exercise of public
power prerogatives by the State or by a body under its
responsibility.

institutions.

does not

the

It

(50)

Therefore the FPAP must clearly be regarded as an under­
taking within the meaning of Community competition
law. There is no need to study its characteristics or
articles of association. In particular, the fact that it may
be non-profit-making is of no relevance. Also, even if
to use the FPAP’s own terms, as a
were regarded,
‘union of consumers of petroleum products seeking
more to protect themselves against the market that to
operate on it’, these ‘consumers’ are in fact economic
operators (maritime cooperatives and fisheries under­
costs.
reduce
takings)
However, this reaction, which is perfectly logical on the
part of economic operators, means that the operators
cannot be regarded as individual consumers within the
meaning of Article 87(2)(a) of
the Treaty, which
authorises aid of a social character granted to them.

running

seeking

their

to

Therefore, the arguments put forward by France or the
FPAP itself relating to its articles of association, its rules
of procedure, its objectives or its specific situation on the
petroleum products market cannot be accepted.

4.1.1.2. T h e p r i v a t e c r e d i t o r p r i n c i p l e (6)

(51)

The Commission takes the view that, in this case, it is
justified to assess the existence of State aid by applying
the private creditor principle.

(52)

The funds coming from the three advances, for which the
grant conditions are known, had to be repaid at an
interest rate of 4,45 %. As regards the possible fourth
advance, of an amount of EUR 12 million,
it may be
it was granted under identical or very
assumed that
similar conditions. This State contribution therefore
corresponds in practice to a loan granted at that rate.
Admittedly, that rate is higher than the reference rate
used by the Commission to determine the element of
loan, which was 4,43 % in
aid existing in a soft
2004 (7) and has been 4,08 % since 1 January 2005 (8).
Consequently, in theory, it is possible that there was no
State aid in the advances granted if it was granted on
normal market-economy terms.

(53) However,

the view that

the Commission takes

the
advances were not granted on normal market-economy
terms insofar as no private creditor would have agreed to
grant
the amounts in question in the absence of a
guarantee of the viability of the FPAP’s activity and the
probability of recovery by the expiry date.

(54)

The FPAP’s start-up capital is made up of its members’
contributions (see recitals 23 and 25). Neither France nor
the FPAP have provided figures of the resources obtained
from these contributions. Also, according to the list of
defensive points enclosed with the reply of 21 April
2006, after stating that ‘when the reply of 6 December
2005 was being drafted, this information was proposed
in the draft but was deleted during the interministerial
check’, the French authorities take the view that ‘it is not
necessary to give a reply now’.

(6) Judgment of

the Court of

Justice in Case C-342/96 Spain v
judgment of the Court of Justice
Commission [1999] ECR I-2459;
in Case C-256/97 DMTransports [1999] ECR I-3913;
judgment of
the Court of First Instance in Case T-152/99 Andrès Molina [2002]
ECR II-3049.

(7) OJ C 307, 17.12.2003, p. 11.
(8) OJ C 220, 8.9.2005, p. 2.

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Official Journal of the European Union

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(55) Nevertheless the Commission supposes that

the

the FPAP,

the expenditure, since, on the basis of

these are
relatively modest amounts compared to the probable
extent of
the
information given in the statement
signed by the
the ‘Detailed Rules of
Secretary-General of
the FPAP’ of November 2004 and the
Procedure of
‘information note from the FPAP’ of January 2006, a
rough estimate can be made: approximately 2 500
members
FPAP
(the number of members of
according to the French authorities) pay a membership
fee of EUR 150 each, i.e. EUR 375 000, to which the
contributions covering the guarantee risk proper (see
recital 25) must be added. Assuming that
the entire
volume of diesel consumed is covered, and based on
the indicative consumption of a 24-metre trawler as
reported by the FPAP (approximately 10 tonnes of fuel
per week), and assuming activity for a maximum of 48
weeks a year, i.e. a consumption of 480 tonnes (although
the number of weeks of activity is probably closer to 38
to 40 than 48), and the unit value of the contribution to
the FPAP, i.e. EUR 0,0035 per litre, the figure arrived at
for 2 500 vessels is a total of EUR 4 200 000 per year.
The third source of contributions comes from the possi­
bility, as provided for in the articles of association, for
the association to take in ‘any person willing to provide
the trade association’, up to a
moral
maximum of 5 % of the number of members. This is
probably a marginal amount. In the absence of any indi­
cation of the number of such members willing to provide
moral support and the amount that they contribute, we
will assume, as a very generous estimate, additional
revenue of about EUR 125 000 (125 members whose
activities do not relate to fishing,
the maximum
permitted by the FPAP’s articles of association (5 % of
2 500 members) × EUR 1 000).

support

for

i.e.

(56)

Thus the total revenue from the various contributions
would amount to EUR 4 200 000 + EUR 375 000 +
EUR 125 000, i.e. EUR 4 700 000 per year. This is an
extremely optimistic assumption, calculated on the basis
of an indicative consumption of a 24-metre trawler
operating for 48 weeks a year, and on the assumption
that all the fuel consumed is covered. The Commission is
only taking it to find out what the theoretical maximum
amount of revenue for the FPAP could be. However, if
we consider that France indicates that the number of
including a considerable
member vessels
less than 12 metres,
proportion of coastal vessels of
whose annual
to 200
tonnes that the 480 tonnes used in the above calculation,
it is probable that the actual amount is significantly less.
This is because, since the French fleet comprises approxi­
mately 1 500 vessels of more than 12 metres and 95,3 %
of the vessels of that size are covered by the FPAP (9), i.e.
it can be deduced that
approximately 1 400 vessels,

consumption is

is 2 385,

closer

fuel

(57)

(58)

approximately 1 000 vessels of less than 12 metres are
also covered by the FPAP. It is therefore highly certain
that the total annual revenue is below this amount of
EUR 4,7 million.

a bank,

Following calculation of this hypothetical revenue, the
Commission observes that the FPAP, on the one hand,
in addition,
apparently has no real estate and that,
its
its members’ contri­
current assets, made up only of
butions, are very small. For this reason, the Commission
the view that, under normal market-economy
takes
conditions,
for
example, which describes itself in its own terms as ‘the
natural partner of the fishing industry’, would never have
lent (or ‘advanced’ to use the terms of the agreements
concluded between the State and the FPAP) the amounts
in question (or even only part of the amounts) to the
FPAP to operate on a futures market, without having
its
assurance
obtained
probable solvency on expiry of the loan.

such as Crédit Maritime,

beforehand

reasonable

of

France objects, claiming that this conclusion is ‘an alle­
gation not based on any precise survey of banking organ­
isations, and that a system of securities could have been
set up’. However, a survey carried out by the Chambre
nationale des conseils et experts financiers (National
chamber of financial advisers and experts) (10) at thirty-
the
five banks provides a fairly accurate picture of
standards applied in French financial
institutions when
granting loans to their customers. To limit their credit
risk vis-à-vis
the management of
customers,
institutions requires compliance with standard
financial
ceilings based on a number of
ratios allowing the
the undertaking and its ability to
financial health of
serve its debt
to be assessed, according to various
criteria such as its own funds, balance sheet, the level
of long-term indebtedness, turnover and financial costs.
It follows from this analysis in particular that a ratio of
‘total banking debt
to own funds’ higher than 2,50
triggers a risk indicator which, although it does not
loan
totally

compromise

granting

their

the

of

a

(9) Contrary to what appeared in the Decision initiating the formal
investigation procedure, vessels in this category (more than 12
metres) do not account for 95,3 % of FPAP member vessels.
In
fact they account for 95,3 % of the vessels in this category which
are covered by the FPAP.

(10) N. Coulon: The new business bank debt ratios, BANQUE No 511,
December 1990, quoted by Alain Galesnes in ‘Le diagnostic bancaire
de l’entreprise (Business banking diagnostics)’
in Editions du Centre
d’Etudes et de Recherches Financières appliquées (CEREFIA), Rennes,
1994/2004.

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Official Journal of the European Union

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leads the establishment to take increased securities. In the
case of the FPAP, if the EUR 65 million in advances are
set against the optimistic estimate of its own funds set
out above (EUR 4,7 million, see recital 56), the ratio is
13,82, i.e. almost six times the maximum risk. Of course,
if the actual amount of the advances were higher (EUR
77 million, taking into account the possible additional
advance of EUR 12 million referred to in recital 22), or if
the actual amount of own funds were appreciably
smaller, this hypothetical ratio would increase further.
With such a risk level, a bank would never have
considered granting a loan, even though the use of real
securities (such as pledging the purchase options or the
fuel stocks acquired by the FPAP as collateral) or personal
(taking out a mortgage on the members’
securities
personal assets and pledging their vessels as collateral)
is
to
in fact one of
minimise the risk of
it will be
observed that, if the personal securities of the members
were liable to be claimed,
the fisheries undertakings
would probably have been more reluctant to become
members of the FPAP. There are also other client risk
transfer or sharing methods, such as part-financing the
loan by several banks, the use of guarantee companies or
subscribing to regional or departmental guarantee funds
(as a rule themselves counter-guaranteed by guarantee
companies) but,
in all cases, a guarantee is generally
extended only to basically healthy and potentially profi­
table undertakings, and only ever up to an amount not
exceeding 50 % of the debt (i.e. in the case of the FPAP,
an amount of slightly more than EUR 30 million, leaving
a residual risk of almost three times the maximum risk).

the methods used by banks

insolvency. However,

(61)

(62)

(59) When France comments on these methods, saying that
security systems ‘could have been’ set up,
it implicitly
admits that they were not set up in this case and that
the State
securities
comparable to those in use by banks being sought.
Under these circumstances, the Commission concludes
that France did not behave like a private creditor and
that it did not have any security that the FPAP was in
a position to repay the funds placed at its disposal.

granted without

advance was

for which it

losses.
undeniable risks and may involve significant
That being so, there is nothing to say that the FPAP’s
liability in the event of significant losses will be covered
by its members. None of
the documents provided
(articles of association, rules of procedure or information
note) refers to such a mechanism. The only financial
consideration appearing in these documents relates to
the contribution,
is
forfeited to the trade association when a member steps
down (Article 10). The Commission also observes that
the act of 21 March 1884, under which the FPAP was set
up,
is the act which has allowed the creation of trade
associations in France. It is certainly not in the spirit of
such an act
the commercial, and therefore
financial, liability of the members of the trade association
concerned. As a result,
in the event of major financial
losses, the Commission does not see how the losses can
be compensated by its members.

is indicated that

to entail

it

Taking all of
the above factors
Commission takes the view that
principle has not been complied with.

into account,

the
the private creditor

4.1.1.3. E x i s t e n c e o f a f i n a n c i a l a d v a n t a g e
S t a t e

m e a n s

b y

o f

g r a n t e d
r e s o u r c e s

The Commission takes the view that, even in the case of
the higher assumption, the estimated amount of revenue
from the various member contributions would never
have enabled the FPAP to operate on a futures market
without the assistance of external funding. This external
funding was provided by the State, via Ofimer,
in the
form of at
three advances spread out between
November 2004 and October 2005, covering a total
amount, according to the information forwarded by
France, of EUR 65 million. A fourth advance of EUR
12 million was probably also paid, since the list of
defensive points quoted in recital 22 implies that the
agreement was in the course of being signed at that date.

least

(60)

In addition, the FPAP, through its Board, points out that
liability under French law and that this
it bears civil
liability is unlimited, noting that
association
action may entail responsibility for large amounts. The
Commission admits that very large amounts may be at
stake, with an organisation like the FPAP where the
operations undertaken on the futures markets present

trade

(63)

France has not submitted any evidence contradicting this
‘As
assessment. The list of defensive points also states:
the FPAP is considered [by the
regards its funding,
the
Commission] not
repayable State advance. No argument can be put
forward against this’. In addition, for the Commission,
the advances were granted under conditions which are
not normal market conditions (see recitals 51 to 61 of
this Decision).

to be able to operate without

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Official Journal of the European Union

12.12.2008

(64) Also, the Commission observes that neither France nor
the FPAP have given it any indication of the amount of
funds invested by the FPAP on the futures markets, or of
the result of the transactions carried out on them. Again,
according to the list of defensive points, the French auth­
orities deliberately chose not to submit this information,
since it states that ‘… this information could be provided
to the Commission. However,
advisability of
providing such information now must be gauged’. The
Commission notes that it did not receive such infor­
mation, neither in that letter nor at a later date.

the

(65)

‘None of

Lastly, France and the FPAP and its Board take the view
that the Commission cannot prejudge the existence of
State aid as long as no repayment default has been estab­
lished (France: ‘the repayable advance cannot be regarded
as State aid as long as the repayment deadline has not
fallen’; FPAP: ‘Can this amount be repaid or not? That is
the main question being asked by the Commission’;
MQA:
the loans to the FPAP granted by
France has expired. At this stage there is no repayment
default nor any indication by the French government
suggesting that
the debt will be purely and simply
cancelled on expiry’). The Commission would point out
in this respect that regarding the aid to the FPAP as State
aid is first and foremost the result of the French Decision
to grant a loan to the FPAP that it would not otherwise
have obtained, even if the repayment deadlines had been
met. The Commission questions the solvency of the FPAP
on expiry of the loan because this question is at the core
of
its situation in relation to the
normal conditions for granting a loan by a private
bank and not because it suspects that a loan has been
transferred into straightforward financial assistance.

the assessment of

(66)

From this point of view, if it turned out that advances
were not repaid within the time limits, or not repaid at
all, this would confirm both that the FPAP was not in a
position to perform the tasks provided for in its articles
of association without external loans, and that it would
never have been granted such assistance by a bank under
normal market conditions. However, in this connection
the Commission observes that France has not informed it
of any repayment of advances granted to the FPAP. They
had to be repaid on 1 November 2006 in the case of the
advance of EUR 15 million covered by the agreement of
12 November 2004, 1 May 2007 in the case of the
advance of EUR 10 million covered by the agreement
of 27 May 2005 and on 1 July 2007 in the case of
advance of EUR 40 million covered by the
the

(67)

(68)

(69)

recital 21).
agreement of 11 October 2005 (see
Regarding the fourth advance which the FPAP may
have received (see recital 22), neither the date of the
agreement nor the final repayment date are known.

The three known expiry dates have now passed. The first
had even already passed when France sent its last letter to
the Commission on 27 November 2006, after
the
investigation procedure.
Decision to initiate the formal
if
The Commission takes the view that,
this advance
had actually been repaid, France or
the FPAP itself
would have informed the Commission without delay
since one of the arguments put forward to counter the
Commission’s assessment was that these advances could
not be regarded as State aid as long as the repayment
deadline had not fallen. There is no doubt that, if the first
advance had been repaid, France would have informed
the Commission of this in its letter of 27 November
2006 and would then have done the same for the
second and third advances, which had to be repaid by
1 May and 1 July 2007, and for the possible fourth
advance. What
the reports published in the
trade press suggest that there has been no repayment
up to now. Thus, the Commission takes the view that
the aid initially granted in the form of an advance was
transformed into aid in the form of a direct subsidy.

is more,

for all

the reasons set out above,

Consequently,
the
Commission considers that the State advances represent
a financial advantage granted by means of State financial
resources.

4.1.1.4. E x i s t e n c e o f a f i n a n c i a l a d v a n t a g e

i m p u t a b l e t o t h e S t a t e

The Commission observes that
the three agreements
concluded between the State and the FPAP expressly
stipulate that the purpose of the public funds paid is
the creation of a cover mechanism against fluctuations
in international oil prices and that the mechanism will
enable financial options to be acquired on the futures
it is obvious that the FPAP’s initial
markets. However,
liquid assets, which were supplied only by its members’
contributions, could not have enabled it to undertake
such operations, at
least not on the scale to which
they were. This is because the first agreement, dated
indicates that the purpose of the
12 November 2004,
the
advance of EUR 15 million was

to ‘enable

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Official Journal of the European Union

L 334/73

mechanism to be started’. Therefore it was indeed thanks
to these advances that the FPAP was in a position to
undertake
acquisition operations on the
futures markets.

significant

(70)

(71)

that

that

it appears

normal. Also,

the State actively
In other words,
supported the creation of
the FPAP, constituted as a
trade association, and its involvement on the futures
markets
for petroleum products, although such an
activity does not reflect the normal activity of a trade
association, and that
that activity was conducted in
competition with private operators under competition
France
not
are
conditions which
‘the
recognised, as early as 7 October 2005,
government has encouraged an initiative by the trade,
i.e. the creation of a fund for the prevention of risks to
fishing. This
fund, managed by the trade, enables
fishermen (…) to pool their financial capacity to buy
financial options on the futures market to cover them­
selves against the risk of fluctuations in the price of fuel’,
the fishermen’s ‘financial
while omitting to state that
capacity’ referred to was based on State resources, since
two advances had already been paid by that date.
However, there is no doubt that the FPAP had to take
account of the requirements of the public authorities in
deciding how to use the funds placed at its disposal.
From this point of view, the introduction of an intermi­
nisterial inspection with the remit of ‘auditing the FPAP
mechanism in its current operation and checking that the
conditions for expenditure are satisfactory as regards
public-expenditure law and rules, while complying with
the commitments entered into by the managers of the
funding’ demonstrates the State’s concern to ensure that
the FPAP’s funds were in fact used for the purpose laid
down in the agreements.

taking all of
the Commission takes

into
Consequently,
account,
the
financial advantage represented by the advances granted
to the FPAP for the acquisition of financial options on
the oil futures markets is imputable to the State (11).

the above factors
the view that

(11) Judgment of

Justice in Case C-482/99 France v
Commission [2002] ECR I-4397, in particular paragraphs 53 to 56.

the Court of

4.1.1.5. E x i s t e n c e o f a f i n a n c i a l a d v a n t a g e
t o

t h r e a t e n s

w h i c h
o r
d i s t o r t c o m p e t i t i o n

d i s t o r t s

(72)

The FPAP enjoys a financial advantage compared to the
other companies operating on the futures markets,
whether they are companies customarily active on these
markets or companies which are or may be set up in the
same way as the FPAP, in the form of a trade association
in the other Member States or even in France itself.

(73)

‘the FPAP cannot be regarded as
France argues that
receiving preferential treatment over other private organ­
isations which could have played the same role because it
is the only French professional organisation aimed at
bringing together fisheries undertakings to buy options
on the futures market’.
the Commission
observes that the FPAP’s position as regards competition
rules should not be assessed solely vis-à-vis other French
organisations made up of
fisheries undertakings and
playing the same role as it, but vis-à-vis all French and
European operators that may be active on the futures
market for petroleum products.

In reply,

(74)

financial

advantage

arose
the FPAP by the other actors of

In addition, the FPAP disputes the claim that it enjoyed
its activity as
preferential conditions for carrying out
investor on the futures market — in its own words:
‘the FPAP operated on the world commodities market
with specialised brokers or financial institutions (…) [It]
did not enjoy any tariff advantage, nor any special
the other operators on the
conditions vis-à-vis all
market’. The Commission does not claim that
the
FPAP’s
from preferential
treatment of
the
market, but that the Fund could only operate on this
intervention margin
market because it had a financial
granted by the State going beyond the FPAP’s own
financial capacity, while the State did not grant
it
to other companies which
under conditions
the FPAP in
may have had the same interest as
operating on this market (undertakings in other sectors
affected by the rise in the cost of oil, for example) or
which operate on this market for reasons linked to their
economic or commercial strategies (oil companies, for
example).

similar

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Official Journal of the European Union

12.12.2008

(75) Also, the FPAP recognises the existence of this advantage.
In a document from the Confédération de la Coopération
Maritime, not
forwarded to the Commission but
published on the website of the ‘Assises de la pêche et
de l’aquaculture de la Région Bretagne’ (12), Mr de
Feuardent, summarising the main points discussed at a
meeting with the Region of Brittany on 24 May 2006,
‘The State has granted assistance of EUR 65
writes:
million to date. Also, the FPAP has made a profit of
several million euro on options on the commodities
market, which is an undeniable value added’. The
Commission concludes from this that
the FPAP was
only able to acquire financial options on the petroleum
products market thanks to the public funds at its disposal
but not at the disposal of other organisations or under­
takings, and that it drew direct benefit from that. Conse­
quently,
the advantage which it enjoyed distorts or
threatens to distort competition.

4.1.1.6. E x i s t e n c e o f a f i n a n c i a l a d v a n t a g e
t r a d e b e t w e e n M e m b e r

a f f e c t i n g
S t a t e s

(76)

In having operated on the commodities market, as Mr de
Feuardent indicates, the FPAP operated on the world oil
market.

(77)

Its activity therefore went beyond a strictly French
framework, so that the advances granted must indeed
be considered as affecting trade between Member States.

4.1.2. Compatibility with the common market

(79) As the agreements concluded between the State and the
FPAP indicate, this State aid in the form of advances was
aimed at enabling the FPAP to begin operating on the
futures markets for oil and oil by-products and continue
doing so. It is therefore operating aid for the FPAP. In its
letter of 6 December 2005, France also recognises that
the amounts indicated were advanced ‘in order to ensure
the operation of the FPAP’.

(80) Under Article 87(2) and (3) of the Treaty, certain cate­
gories of aid are or may be considered compatible with
the common market. It should be examined whether the
operating aid for the FPAP falls under one of these cate­
gories.

(81)

The Commission observes that this aid does not match
any of the cases provided for in Article 87(2).

(82)

This is because it is not intended to make good damage
caused by natural disasters or other exceptional occur­
rences. The Commission would point out
in this
connection that fluctuations in oil prices are inherent
in economic activity. Fluctuations also affect other
sectors of activity which consume petroleum products
in all the Member States of the European Union and
cannot be regarded as a natural disaster or an exceptional
occurrence within the meaning of Article 87 of
the
Treaty. The aid is therefore not compatible with the
common market under Article 87(2)(b) of the Treaty.

4.1.1.7. C o n c l u s i o n

(83) Nor can the aid be considered compatible with the
common market on the basis of direct application of
the Treaty, with the various cases
Article 87(3) of
provided for.

(78)

Thus, the four requirements for establishing the existence
of State aid are met: the advances paid to the FPAP come
from State resources, they are imputable to the State,
threaten to distort competition, and
they distort or
they affect
trade between Member States. The aid
enjoyed by the FPAP therefore does constitute State aid
within the meaning of Article 87 of the EC Treaty as
regards
funding coming from State
resources used for the acquisition of options on the
petroleum product futures market.

the part of

its

(12) http://pecheaquaculture.region-bretagne.fr

(a)

It is obviously not aid to promote the economic
development of areas where the standard of living
is abnormally low or where there is serious under­
for
employment
in
case
Article 87(3)(a)). The aid is in fact
intended to
enable the FPAP to operate on the relevant futures
markets. It is therefore not related to the aid referred
to in Article 87(3)(a).

provided

(the

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(85)

(86)

(87)

(b) The FPAP cannot be regarded as an important project
of European interest or aid to remedy a serious
disturbance in the economy of a Member State (the
cases provided for in Article 87(3)(b)). This is because
the FPAP is specifically French and the other Member
States did not express their intention to set up funds
of the same kind. Therefore there is no European
dimension to the Fund. As regards the consideration
as to whether the aid is intended to remedy a serious
disturbance in the economy of a Member State, the
Commission observes
there is no evidence
that
making it possible to say that providing money for
a fund of this kind could bring about such a remedy.
As regards the aid for the FPAP itself, the aid benefits
only one economic entity and, even if it is linked to
aid granted to fisheries undertakings, does not benefit
the economy of a Member State as a whole.
In
addition, the Commission would point out that it
has always taken the view that the public authorities
should not intervene financially against the rise in the
price of oil. On the contrary their role should be, in
particular, pursuing incentive policies
for under­
to the new economic
takings so that
is
conditions created by the price increase. That
why aid aimed at making it possible
an
economic entity to operate on the relevant futures
markets does not match the desired objective.

they adapt

for

compatible with the

(c) The existence of the FPAP cannot, in itself, meet the
requirements of Article 87(3)(c), which stipulates that
aid intended to facilitate the development of certain
economic activities or of certain economic regions
common market
may be
where it does not adversely affect trading conditions
to an extent that is contrary to the common interest.
There is no evidence that
the development of or
increase in operating on the oil futures markets is
desirable. Moreover, that activity is not linked to an
economic region. That
is why the aid cannot be
considered compatible with the common market
under Article 87(3)(c).

(d) Lastly, this kind of aid does not fall under the cate­
gories of aid which may be considered compatible
with the common market by a Decision of
the
Council adopted in accordance with Article 87(3)(e).

In conclusion, therefore, the result is that the aid for the
FPAP for
the acquisition of options on the futures
markets cannot be considered compatible with the
common market
exemptions
permitted by the Treaty.

under

any

the

of

4.2. Aid for fisheries undertakings: reduction of
expenditure on fuel

Before analysing the aid which led to the formal
initiation of the investigation procedure, the Commission
must give an opinion on the FPAP’s argument that the
aid granted to itself and fisheries undertakings should be
considered in the light of a raising of the de minimis
threshold in the fisheries
sector. According to the
FPAP,
the amounts in question (approximately EUR
16 000 per undertaking on average, excluding the aid
which it regards as being direct social assistance for
fishermen) is considerably lower than those which were
in the process of being adopted at the time of payment
the compensation by the FPAP (EUR 30 000 per
of
undertaking) (13).
In their reply the French authorities
also refer to the raising of the de minimis threshold but
do not seek to apply it to this aid scheme.

3

i.e.

sectors (14),

that, under
the Commission points out
First of all,
Article
(EC) No
of Commission Regulation
1860/2004 of 6 October 2004 on the application of
Articles 87 and 88 of the EC Treaty to de minimis aid
in the agriculture and fisheries
the
provision in force at the time the aid was granted to
fisheries undertakings,
the maximum amount of de
minimis aid was EUR 3 000 per undertaking over three
years. The aid under consideration in this Decision con­
siderably exceeds that amount and in its comments
France did not mention any application of this ceiling
to the undertakings which could have benefited from it.
Moreover, even if the amount of EUR 30 000, which
in Regulation (EC) No 875/2007 recently
appears
adopted by the Commission (15),
than the
EUR 16 000 referred to above by the FPAP,
that
amount
In addition, France is
wrong to arrive at this amount of EUR 16 000, since
it excludes the part of the aid which it regards as social
assistance and which has to be taken into account in the
assessment (see recitals 122 and 123). Thus, given the
differences in size of the FPAP’s member fisheries under­
takings, it is certain that the amount of the aid granted to
some undertakings is greater than EUR 30 000. For

is only an average.

is higher

(84)

The Commission also notes that none of the guidelines
that it has adopted for assessing State aid applies to this
operating aid for the FPAP.

(13) This is the threshold ultimately laid down in Commission Regu­

lation (EC) No 875/2007 (see footnote 14).

(14) OJ L 325, 28.10.2004, p. 4.
(15) See footnote 14.

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example, for trawlers from 20 to 25 metres, the annual
amount of the allowance is around EUR 35 000, i.e. EUR
70 000 for the two years 2005 and 2006 (16). In any
event, as indicated above, France did not seek application
of the new de minimis ceiling and did not provide any
evidence that it did so. Consequently, taking all of the
above factors into account, in the context of the constant
review of State aid schemes the Commission is obliged to
verify compliance of
this aid with the provisions of
Article 87 of the Treaty.

4.2.1.1. E x i s t e n c e o f a f i n a n c i a l a d v a n t a g e

g r a n t e d t h r o u g h S t a t e r e s o u r c e s

(90)

The advantage drawn by fisheries undertakings from the
FPAP’s activities is two-fold: on the one hand it consists
of the possibility of obtaining fuel at an advantageous
price, and on the other of receipt of an allowance
partially compensating for their expenditure on fuel.

(88)

(89)

4.2.1. Existence of State aid

France takes the view that the Commission has no valid
reason to extend its assessment of the existence of State
aid to this aspect of the Fund’s activities. According to
‘recognition of aid as State aid must be based
France,
solely on an ad hoc assessment of the repayable State
the FPAP’s
advance and not on an assessment of
activities. Thus the French authorities request that only
the first part (Part 3.1) of the assessment be developed.
Part 3.2 amounts to a condemnation of the activities of
the FPAP, which is a trade association purchasing options
to cover its members against fluctuations in the price of
diesel’ (17).

In reply, the Commission points out that, as has been
consistently held in case law, aid is not characterised by
its causes or objectives, but is defined according to its
effects (18). In addition to acquiring financial options on
the futures markets, the aim of the FPAP, according to
the agreements concluded with the State,
is to pay
compensation to fisheries undertakings corresponding
to the difference in price between the maximum price
covered and the average monthly price in the reference
index for the month under consideration. Consequently,
the Commission takes the view that the fisheries under­
takings enjoyed specific advantages as a result of the
system set up by the FPAP and that it is necessary to
analyse the effects of the advances granted by the State
not only from the point of view of the advantage granted
to the FPAP, but also from the point of view of the
advantages granted to the fisheries undertakings.

contracting

cooperatives’

(91) As regards the first aspect, the acquisition of options on
the futures markets by the FPAP, which then passed on
the forward-bought fuel to the Cecomer company, the
maritime
agency,
central
enabled the FPAP’s member undertakings to buy fuel
acquired by those cooperatives at a price lower than
that on the ordinary market. But, as indicated above
(see recital 75 of this Decision), this was possible only
because ‘The State has granted assistance of EUR 65
million to date. Also, the FPAP has made a profit of
several million euro on options on the commodities
market, which is an undeniable value added’. The
Commission therefore notes that the supply of fuel to
fisheries undertakings at a price lower than that on the
ordinary market was possible due to the advances
granted by the State and the FPAP’s own resources, i.e.
the product of its members’ contributions and the profits
from speculative operations on the futures market for
petroleum products.

(92)

The funds used to finance the compensation paid to
fisheries undertakings also came from two sources
(State resources and resources from the FPAP’s private
activity).

(16) Source: Observatoire

économique

‘Résultats des flottilles artisanales 2005/2006’
observatory of
fisheries
2005/2006’), Summary.

in Brittany,

régional des pêches de Bretagne.
(Regional economic
fleets
craft

‘Results

for

(17) The references to Parts 3.1 and 3.2 refer to the Decision initiating
the formal investigation procedure mentioned in recital 11. Part 3.1
dealt with the aid for the acquisition of options on the futures
markets and the resultant financial advantages for the FPAP and
the fisheries undertakings; Part 3.2 dealt with the compensation for
the purchase of fuel for those undertakings.

(18) In particular: judgments of the Court of Justice in Case 173/73 Italy
in Case C-241/94 France v
v Commission [1974] ECR 709;
Commission (known as ‘Kimberly Clark’) [1996] ECR I-4551;
in
Case C-480/98 Spain v Commission [2000] ECR I-8717; and in
Case C-5/01 Belgium v Commission [2002] ECR I-11991.

(93) As described in recital 24 of this Decision, the FPAP
bears
the
the difference in price that exists, under
agreements of 12 November 2004 and 27 May 2005,
between the ‘maximum price covered’ and the average
monthly price in the reference index and, under the
agreement of 11 October 2005, between 30 euro cent
per litre and the average monthly reference price if the
latter is higher than 30 euro cent.

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(94)

The ‘evening-out’ mechanism provided for was originally
based on the assumption that
the additional costs
exceeding a reference price in times of high prices
could be compensated by means of the contributions
lower prices. Thus
paid by the members in times of
the system would be self-financing. Referring to Mr de
Feuardent’s document already mentioned in recital 75 of
this Decision, ‘technically the FPAP was able to take the
first options from April 2004 onwards; at that time,
Cecomer’s
(approximately 200 million
litres)
i.e.
for 2005 could be met at 0,28 cent/litre,
approximately EUR 4 million’. Thus, at the beginning
of 2004 the FPAP could perhaps have covered the rela­
insurance’ out of its
tively modest needs of the ‘diesel
it was
therefore appears
It
own resources.
originally designed,
the Fund could have been self-
sufficient.

requirements

that, as

(95) However, since oil prices stayed at a very high level and
the FPAP’s membership expanded, it rapidly acquired a
large number of members. The result was that the cost of
insurance’ exploded and could only be
this
supported by using the advances granted to the FPAP
by the State.

‘diesel

(97)

(96)

is because,

the FPAP to cover

if we take the averages

If we attempt to estimate the appropriations necessary
the expenditure on ‘diesel
for
insurance’ for 2005, we can start from the assumption
that the level of fuel consumption for which compen­
sation was claimed by the fisheries undertakings probably
increased from 200 million litres (see recital 94) to a
volume that can be estimated at almost 900 million
litres. This
for
annual consumption which served as the basis for the
calculations in recitals 55 and 56, the consumption of
1 000 vessels of less than 12 metres would be 1 000
vessels × 200 tonnes/vessel, i.e. 200 000 tonnes, and the
consumption of vessels of more than 12 metres would
be 1 400 vessels × 480 tonnes/vessel,
i.e. 672 000
tonnes, which is in total 872 000 tonnes (or 872
if
million litres).
we consider that vessels fish for 38 weeks a year rather
than 48, consumption is probably closer to 700 000
tonnes (1 000 vessels of less than 12 m × 158 tonnes,
i.e. 158 000 tonnes and 1 400 vessels of more than 12
i.e. 532 000 tonnes). Assuming a
m × 380 tonnes,

In reality, as indicated in recital 55,

the annual

insured part of

ceiling on compensation of 12 cent per litre, which was
applied to the third advance (19),
financial
requirements of
the FPAP were thus about EUR 85
million. Considering the fact that the fisheries under­
fuel
takings perhaps only
their
consumption,
required were
probably less, but the order of magnitude remains at
several tens of millions of euro a year, as compared to
the initial estimate of EUR 4 million for 2005.
It is
therefore obvious that the FPAP could not have coped
with the cover guaranteed to its members, in exchange
for
external
funding, in this case the advances granted by the State.

contributions, without

appropriations

receiving

their

the

are

the

thus

liquid assets

composed of

futures markets. The part of

In this context, the FPAP received public funding to meet
the needs of this ‘diesel insurance’, with the proviso that
it managed the funds as efficiently as possible. The
FPAP’s
funds
coming from the members’ contributions,
the State
advances, and the potential profits of its activities on
the oil
funding
coming from the State advances is undeniably State
resources. As regards the profits made on the futures
markets which enabled the fisheries undertakings to be
supplied with less expensive fuel, it was only possible for
them to be made thanks to the existence of the State
resources, which gave the FPAP the means to undertake
financial transactions on the futures markets. In addition,
the agreements
although the exact characteristics of
concluded between the FPAP and Cecomer are not
known and cannot be deduced from any of
the
documents
the Commission
supposes that
the compensation paid to the member
undertakings, consisting of the difference in price, was
lower than if Cecomer and the maritime cooperatives had
supplied fuel to the fishermen which had been bought on
the ordinary market, i.e. without the FPAP’s operations
on the futures markets. Thus, the profit from the FPAP’s
operations on the futures markets was transferred to
Cecomer, the supply cooperative of the maritime coop­
eratives, and ultimately to the fisheries undertakings
which obtain their fuel from them. The practical effect
the FPAP could continue paying
was certainly that
compensation for a longer period than if the FPAP had
only been an intermediate body solely responsible for
distributing the EUR 65 (or 77) million provided by
the State under cover of the ‘diesel insurance’ mechanism.

forwarded by

France,

(19) See paragraph II of the speech by Mr D. Bussereau, the Minister for
Agriculture and Fisheries, delivered on 30 June 2005 at the general
meeting of the Comité national des pêches maritimes et des élevages
marins, which can be found at
the following Internet address:
http://agriculture.gouv.fr/IMG/pdf/discours_300605_ag-cnpm.pdf.

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(98)

The Commission therefore takes the view that it was
indeed by means of State resources,
irrespective of
whether they were fed directly into the FPAP’s liquid
assets or
further
they were used to make profits
the fisheries undertakings
increasing those assets, that
were able to enjoy a financial advantage, on the one
hand by having the possibility of obtaining supplies of
fuel at an advantageous price, and on the other by
receiving a compensatory allowance calculated on the
basis of a reference price.

(99)

4.2.1.2. E x i s t e n c e o f a f i n a n c i a l a d v a n t a g e

i m p u t a b l e t o t h e S t a t e

concluded
three, or possibly four, agreements
The
between the State and the FPAP provide that
the
ultimate purpose of the public funds paid in the form
of advances is to partially compensate fisheries under­
takings for the cost of fuel. The compensation paid to
the fishermen in the form of an allowance equivalent to
the difference between a reference price and a price at the
pump comes in addition to a reduction in the price of
diesel at the pump of the supplier, who is, as a rule, the
maritime cooperative.

the granting of

there is no doubt

Fund’s resources and expenditure have been allocated can
be obtained’, the State did not have any part in the
Decision on the strategy to be followed by the FPAP
for acquiring these financial options or on the level of
the financial compensation to be paid to the under­
takings. Consequently, although, as was demonstrated
in paragraph 4.1.1.4,
the aid
that
consisting of
the three, or possibly
four, advances is imputable to the State, that is not the
the additional advantages enjoyed by the
case for
fisheries undertakings resulting, on the one hand, from
their contributions and, on the other, from the prudent
management of the FPAP’s liquid assets as a whole. This
is because, although the aid ultimately paid to the
fishermen was higher than the public funds originally
received by
to the operations
undertaken on the futures markets, the part of the aid
exceeding the amount of the public funding advanced did
not result from a State Decision. Thus, even if it is not
possible, from an accounting point of view, to identify
precisely what came from State resources and what came
from the Fund’s own resources, since it was the liquid
assets as a whole which were used to operate on the oil
futures markets and pay the compensatory allowance, in
the Commission’s view the advantage resulting from the
difference between the total amount of aid paid to the
fisheries undertakings and the total amount of the State
advances transferred to the fisheries undertakings is not
imputable to the State.

thanks

FPAP

the

(100) The FPAP’s

to enable it

liquid assets, originally made up of

its
members’ contributions then supplemented by an initial
advance by the State, enabled it to operate on the futures
markets and make profits, although those profits were
not sufficient
to simultaneously pay the
compensatory allowance guaranteed to the fisheries
undertakings in return for their contributions. However,
two, or possibly three, additional advances enabled it to
continue its activities before it gradually had to reduce its
holdings in order to have the liquidity required to pay
the allowances. The Commission observes
the
Decisions on the operations on the futures markets
were taken by the President of the FPAP. They were
actually implemented by commissioning brokers and
specialised financial institutions (see recital 74), and the
amount of remuneration paid to them by the FPAP is not
known to the Commission. However, although the
FPAP’s articles of association provide that the President
‘to decide on
must consult
the Board of Directors
proposed cover plans’, the State is not represented on
that Board. Thus, although the FPAP was generally
required ‘to keep accounts so that, on request,
infor­
mation on how the advances have been used and the

that

4.2.1.3. E x i s t e n c e o f a f i n a n c i a l a d v a n t a g e
t o

t h r e a t e n s

w h i c h
o r
d i s t o r t c o m p e t i t i o n

d i s t o r t s

(101) The Commission considers that

the reduction in fuel
expenditure enjoyed by the FPAP’s member
fisheries
undertakings favours those undertakings because they
are the only ones able to benefit from the reduction.
Their position is strengthened in relation to other under­
takings competing with them on the Community market,
irrespective of whether they are other fisheries under­
takings or undertakings in other sectors of economic
activity with an interest in reducing their running costs
as regards fuel expenditure. Moreover, since the cover
fisheries undertakings,
mechanism is targeted only at
the advantage thus granted to those undertakings must
be regarded as a sectoral advantage not accessible to
other sectors. But, by favouring a particular sector, any
form of aid distorts or threatens to distort competition
(see Commission Decision 2006/269/EC of 8 February
2006 on tax deductions
fishermen
(Sweden) (20), recitals 31 and 35).

for professional

(20) OJ L 99, 7.4.2006, p. 21.

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(102) France objects that this aid did not favour the FPAP’s
member undertakings insofar as ‘membership of
the
FPAP is free and open to all
fisheries undertakings
provided that they pay their contribution’. MQA adds
that membership is open ‘without consideration of the
structure or nationality of the recipient’. Lastly, the FPAP
points out that ‘the FPAP’s member undertakings are held
by French capital, but also by Spanish and Dutch capital’.

(106)

is,

and that

and mechanisms

In this connection the Commission observes that these
costs, whether or not they are higher or lower in France
than in the other Member States, are the result of the
constraints of the regulatory framework in which fishing
is carried out today. In its communication of 26 February
2007 on rights-based management tools in fisheries (21),
the Commission points out that the Community fisheries
sector is characterised by a multiplicity of management
instruments
comparable
situations are treated in sometimes very different ways,
depending on the Member State. The result
in
particular, that selling and buying are current practice
in some Member States,
either within established
markets or indirectly. The costs mentioned by the FPAP
are the costs with which the fleets of the various Member
States are confronted and correspond to the level of
economic development of
sector. They
result from the implementation at national level of the
management measures which the common fisheries
policy lays down or makes necessary. This implemen­
tation does not justify the introduction of specific aid
For
in an individual Member State.
reason,
contrary to what
the distortion of
the FPAP argues,
competition must not be assessed within the confines
of a ‘relevant market’, for example a ‘regional micro-
market’, a concept
to which it
is
provided for under
the Treaty, within the common
market as a whole. Thus, if the effect of the FPAP’s aid
fishing within a
is to facilitate the maintenance of
regional framework and protect resources by preventing
deep-sea vessels from falling back on closer grounds or
trawlers from targeting more specific fisheries, as is
it perfectly matches aid which
argued by the FPAP,
competition and
threatens
distorts or
therefore, in this respect, State aid.

refers, but, as

the fisheries

to distort

that

(107) Also, for all the reasons set out above, the Commission
considers that
the funds advanced by the State and
enjoyed by the fisheries undertakings, via the FPAP,
distort or threaten to distort competition.

4.2.1.4. E x i s t e n c e o f a f i n a n c i a l a d v a n t a g e
b e t w e e n

a f f e c t s

t r a d e

w h i c h
M e m b e r S t a t e s

(108) The FPAP disputes the fact that the aid granted to the
association’s member fisheries undertakings affects trade
between the Member States. Thus, according to the FPAP,
these undertakings carry out their activities in ‘a market
which is by no means unique, but which is based more
on a “mosaic” of regional micro-markets’.

(21) COM(2007) 73 final.

(103)

In reply, the Commission observes that the only fisheries
undertakings which may join the FPAP are those which
have vessels registered in metropolitan France or the
overseas
departments. Therefore undertakings with
Dutch or Spanish capital holding French vessels may
indeed become members of
is certainly
those vessels to which France and the FPAP allude in
their replies. But other Community vessels may not
become members.

the FPAP.

It

(104) All the undertakings enjoying the compensation paid by
the FPAP compete on the Community market with
undertakings whose vessels fly the flag of
the other
in
Member States and which also have an interest
reducing their running costs as regards fuel expenditure,
but which do not have at their disposal any compen­
sation system of the kind set up by the FPAP. For that
reason, the advantage enjoyed by the member fisheries
undertakings or fisheries undertakings which have not
yet become members but which are able to do so, i.e.
all
the undertakings having fishing vessels flying the
French flag, is clearly a distortion of competition.

(105) The FPAP also takes the view that the factors distorting
competition must be sought elsewhere. Referring to the
existence of major additional costs which, according to it,
are not economically justified, such as costs resulting
from the management of
the multiannual guidance
plans for the fishing fleet, i.e. management of the fleet’s
overall capacity, or costs relating to management of
‘production rights’,
in particular
“policies”
“rights”
‘The
that
represent (…) the real factor distorting European compe­
tition [and] they result mainly from the economic field’.

the FPAP points out

to national

attaching

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(109)

(110)

imports of

In reply, the Commission notes that the total value of
French exports of fishery and aquaculture products to the
rest of the world was EUR 1 290 million in 2005, 80 %
of which went to the Member States of the European
this
the total value of
Union. Similarly,
category of products
to France in 2005 was EUR
3 693 million, 40 to 60 % of which, according to
sources, came from the Member States of the European
Union (22). By comparison,
the total value of French
production was EUR 1 868 million. Consequently,
without going into a detailed quantified economic
analysis (23),
the price
that,
variations for each species recorded each day in French
or European ports, the volume of trade in the supply
fishery and aquaculture products between
balance of
France and the rest of Europe is considerable. Measures
aimed at
favouring a significant number of French
fisheries undertakings (more than 30 % of the fleet) by
reducing their running costs necessarily have an impact
on trade between Member States in the fisheries sector.

regardless of

is clear

it

is

therefore clear

the advantage enjoyed by
It
fisheries undertakings by bearing part of their running
costs affects trade between Member States.

that

4.2.1.5. C o n c l u s i o n

(111) The four requirements for establishing the existence of
State aid are only partially met. The advantage enjoyed
by fisheries undertakings does result from the use of
State resources, it distorts or threatens to distort compe­
tition and it affects trade between Member States. On the
other hand, it is imputable to the State only up to the
amount of the advances, since those advances constitute
only a part of the FPAP’s liquid assets and the State did
not intervene in the choices made by the FPAP to make
profitable use of the funds placed at its disposal. Thus,
the Commission concludes that State aid within the
meaning of Article 87 of the EC Treaty exists only to
the extent of the public funding provided, i.e. EUR 65 or
77 million.

(112) Finally, the Commission observes that the French auth­
orities, notwithstanding their replies of 7 October 2005
and 21 April 2006, do not actually dispute
the
Commission’s conclusions on the existence of State aid.
the draft
This is because, during the examination of
finance act
the
Minister for Agriculture and Fisheries, questioned on
the future of the FPAP, replied: ‘the FPAP has been oper­
the European
ational
it
Commission is monitoring
involves State aid’ (24).

for 2007 by the national parliament,

since 1 November 2004, but

closely, because

it

(22) Source: Ofimer, Les chiffres-clés de la filière pêche et aquaculture en France
(Key figures for fishing and aquaculture in France), 2006 edition.
Also, Eurostat and Global Trade Information Service.

(23) Judgment of the Court of First Instance in Case T-241/95 Het
Vlaamse Gewest v Commission [1998] ECR II-717, paragraph 67.
(24) National parliament — Minutes of the session of 25 October 2006,
hearing of Mr Dominique Bussereau, Minister for Agriculture and
Fisheries.

4.2.2. Compatibility with the common market

(113) Under Article 87(2)(3) of the Treaty, certain categories of
aid are or may be considered compatible with the
common market.

(114) The Commission observes that this aid does not match
any of the cases provided for in Article 87(2) of the
Treaty.

(a)

the FPAP acted as ‘a consumer
In arguing that
defence organisation’ or as a ‘union of consumers
of petroleum products’, MQA seems to suggest that
aid for fisheries undertakings could be treated as ‘aid
having a social character, granted to individual
consumers’ as provided for in Article 87(2). In this
the Commission would only observe that
respect,
to ‘individual
specifically
that paragraph refers
consumers’ and not undertakings, and that, conse­
it cannot apply to the present case (see
quently,
also recital 50 of
aid is
therefore not compatible with the common market
under Article 87(2)(a) of the Treaty.

this Decision). This

consume

activity which

since fluctuations

of
in all Member States of

(b) The aid is not aid intended to make good damage
caused by natural disasters or other exceptional
in oil prices are
occurrences,
inherent in economic activity. They also affect other
petroleum
sectors
products
the European
Union and cannot be regarded as a natural disaster
or an exceptional occurrence within the meaning of
Article 87(2)(b). However, MQA objects
to this
analysis, arguing that the aid does result from an
exceptional situation ‘since the Commission itself
admits the sector’s exceptional economic and social
difficulties’. It is certainly true that the fisheries sector
has to cope with particular difficulties which the
Commission analysed in detail in its communication
of 9 March 2006 entitled ‘improving the economic
situation in the fishing industry’ (25). In this commu­
nication, the Commission showed that the sources of
the sector’s economic and social difficulties lie in its
inadequate structural adjustment to the constraints to
which its activity is subject. It also set out various
sector’s
proposals
economic difficulties. Examining the compatibility
it points out very clearly:
of certain operating aid,

for overcoming the

fisheries

(25) COM(2006) 103 final.

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in costs.

Such aid would

‘The current difficulties in the fishing industry have
been aggravated by the recent increase in fuel prices.
This has led to calls from the fishing industry for
public intervention to compensate for this sudden
constitute
increase
operating aid which is
incompatible with the
Treaty. The Commission would not approve any
this purpose’. Referring to a
aid notified for
guarantee
initially
comparable
thought of when the FPAP was set up, it adds ‘The
Commission could approve such a scheme only if it
were to provide guarantees of reimbursement of all
public aid under commercial conditions, which,
in
seems very
the current economic circumstances,
unlikely’.
inputs,
including fuel, are inherent
in economic activity
and cannot in themselves constitute an exceptional
occurrence.

Fluctuations

cost of

to that

in the

scheme

In view of the foregoing, the Commission considers that
the State aid in question enjoyed by the fisheries under­
takings is not compatible with the common market
under Article 87(2)(b) of the Treaty.

(115) Nor can the aid be considered compatible with the
common market on the basis of Article 87(3) of the
Treaty and the various cases which it provides for.

(a)

It is not aid to promote the economic development
of areas where the standard of living is abnormally
low or where there is serious underemployment (the
case provided for in Article 87(3)(a) of the Treaty).
This aid is intended to reduce the running costs of
fisheries undertakings. Admittedly, the FPAP points
out that the aid is intended to facilitate the main­
framework.
fishing within a regional
tenance of
However,
the aid is
the Commission notes that
granted to fisheries undertakings regardless of their
registered place of business or the home port of the
vessels
therefore bears no
relation to the aid referred to in Article 87(3)(a).

they operate.

that

It

in the French economy as a
not undertakings
whole. The sectoral nature of this aid is undeniable
since the rise in the cost of oil not only affected
undertakings in the fisheries sector but all under­
in this
takings across all sectors of activity. And,
respect, the Commission has always taken the view
that the public authorities should not intervene finan­
cially to compensate for the rise, but on the contrary
provide incentives for undertakings to adapt to the
resultant new economic conditions. Thus, in view of
all these factors, the Commission considers that the
FPAP for fisheries undertakings cannot be considered
compatible under Article 87(3)(b).

(c) As regards Article 87(3)(c),

the

the reduction of

the development of

fuel
expenditure cannot, in itself, meet the requirements
it lays down, according to which aid intended to
facilitate
certain economic
activities or of certain economic regions may be
compatible with the common market where it does
not adversely affect trading conditions to an extent
is contrary to the common interest. This is
that
because
aimed at
aid in question is not
fishing activities
encouraging the development of
in accordance with the
towards sustainable fishing,
objectives of the common fisheries policy. On the
contrary it maintains
fishing effort
without providing fisheries undertakings with any
incentive to reduce their fuel expenditure. Conse­
quently, their effect is to slow down the necessary
adaptation of fisheries undertakings to the constraints
resulting from the rise in the price of oil. Moreover,
this activity is not linked to a particular economic
is why the aid cannot be considered
area. That
under
compatible with
Article 87(3)(c).

common market

the level of

the

(d) Lastly, this type of aid obviously does not fall under
aid to promote culture and heritage conservation or
aid considered compatible with the common market
by Decision of the Council adopted in accordance
with Article 87(3)(e).

the

(b) Nor can the aid be regarded as aid intended to
an important
implementation of
promote
project of common European interest or as aid to
remedy a serious disturbance in the economy of a
Member State. It bears no relation to an important
project of common European interest. Nor can it be
described as aid intended to remedy a serious
disturbance in the economy of a Member State.
This is because the aid granted to fisheries under­
takings is aimed at
remedying the difficulties of
undertakings in an individual economic sector and

(116) The result of all these factors is that the State aid granted
to fisheries undertakings to reduce their fuel expenditure
is not covered by any of the derogations provided for in
Article 87 of the Treaty.

(117) Since this is aid for fisheries undertakings, it must also be
assessed in the light of the Guidelines for the examina­
tion of State aid to fisheries and aquaculture (‘Guidelines’
in the following).

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(118) The effect of the aid is to reduce the running costs of
It displays the characteristics of

fisheries undertakings.
operating aid.

the Guidelines,

(119) First of all the Commission would point out that, under
‘State aid may not be
point 3.5 of
it must serve to promote the
protective in its effect:
rationalisation and efficiency of
the production and
marketing of fishery products. Any such aid must yield
lasting improvements so that the industry can develop
solely on the basis of market earnings’.

difficulty. Moreover, rescue aid may not exceed a period
of six months and must take the form of a repayable
loan or a guarantee. As regards restructuring aid, it must
be granted under specific conditions and for a limited
duration. However, the aid granted by France via the
FPAP does not meet any of the conditions laid down:
fisheries undertakings have been receiving this aid since
is not granted in the form of a loan or
2004,
guarantee, and no provision has been made for
its
repayment under a restructuring plan.

it

towards

activities

sustainable

(120) However, as set out in recital 115(c) of this Decision, the
reduction in fuel expenditure is not aimed at developing
fisheries
in
accordance with the objectives of the common fisheries
policy, but the continuation of the fisheries undertakings’
activity unchanged. This is why the Commission takes
the view that this aid is indeed protective in its effect,
as referred to in point 3.5 of
the Guidelines, and
therefore cannot be considered compatible with the
principle laid down by the Guidelines.

fishing,

(121)

It is true that, in its replies to the initiation of the formal
investigation procedure, France indicated that ‘the actions
the FPAP anticipated useful measures which the
of
recovery and restructuring plans, once ratified, will only
illustrate and confirm’. However, it was only much later,
in January 2008, that France informed the Commission
of the implementation of measures presented as being
aid schemes for the rescue and restructuring of fisheries
undertakings,
registered by the Commission under
number NN 09/08 and currently in the process of
being assessed. Nevertheless, even if France’s argument,
i.e. that the action taken by the FPAP anticipates to a
certain degree the aid schemes for rescue and restruc­
turing,
is accepted, that does not affect their compati­
bility with the common market as a result of the funda­
mental differences between the measures implemented by
the FPAP and the requirements which the aid schemes
for the rescue and restructuring of undertakings must
meet, which are described in the Community guidelines
on State aid for rescuing and restructuring firms in
difficulty (26). This
is
required in those guidelines, the aid resulting from the
action taken by the FPAP was granted indiscriminately to
all fisheries undertakings and not only to undertakings in

is because, contrary to what

(26) OJ C 244, 1.10.2004, p. 2.

In this connection,

the French Act….

(122) The FPAP also considers that the aid granted is justified
by the fact that in reality it is aid for employees’ income.
In this connection the FPAP writes: ‘The FPAP is set up as
a “prevention group” constituting a legal safety perimeter
for its 2 500 member undertakings within the meaning
the aid for
of
employees’ income within the restructuring perimeter is
authorised. It does not affect the competition rules in any
way. On the contrary, it is in line with the Community
principles guaranteeing employees
fair minimum
income’. The FPAP goes on to state that the system of
payment for fishermen in France by giving them a share
of the crew’s profit has had the effect of depriving the
employees of
fisheries undertakings of their wages or
even putting them in debt to the shipowners. Lastly, it
points out that 25 million of the 65 million advance
granted by the State ‘directly relate to advances to
employees
social
regarded as direct
‘If the loans are regarded as aid,
assistance’. MQA adds:
for its
not
member fisheries undertakings, it really would be social
assistance, since the financial assistance thus granted
would be directly linked to the sailors’ pay’.

for the FPAP, which is transparent, but

and must be

a

(123) These statements prompt the Commission to make a few

comments:

1. First of all, it is surprised to read that almost 40 % (25
million out of 65 million) of
the cash advances
granted by the State in order, according to the three
this
agreements described above (see recital 21 of
Decision),
financial
to enable the acquisition of
options on the petroleum product futures markets,
‘directly relate to advances to the employees and
must be regarded as direct social assistance’.

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2. The Commission supposes that this is a rhetorical
shortcut on the part of the FPAP, designed to show
the action taken by the FPAP reducing the
that
running costs of
fisheries undertakings, given the
system of payment by giving employees a share of
the profit, ultimately benefits the employees of these
undertakings.
sense the action could be
regarded as ‘direct social assistance’. In fact nothing
in the file indicates that there has been any direct
i.e. aid paid by the FPAP directly
social assistance,
to the employees of
is
the FPAP’s articles of association make no
more,
provision for
this
Decision).

these undertakings. What

(see recital 20 of

this at all

In that

advantages granted by public

3. However, that may be, i.e. whether the aid may have
been paid directly to the employees or the effect of
the action taken by the FPAP was to provide a benefit
for those employees, enabling them to supplement
their income based on the system of a share of
profits, the Commission points out that, according
to settled case-law (27),
the concept of aid encom­
authorities
passes
which, in various forms, mitigate the charges which
are normally included in the budget of an under­
taking. In this sense, wages are indisputably a part
of such charges and an undertaking cannot count
on public funding to bear them. Consequently, the
fact that the advantages enjoyed by fisheries under­
takings in the form of the possibility of buying fuel at
preferential prices and partial compensation for their
fuel expenditure did in reality, according to the FPAP
and MQA, benefit
those under­
takings is of no relevance for assessing the compati­
bility of
is
sufficient to establish that the effect of the advantages
granted to fisheries undertakings out of public funds
was a reduction of the charges which normally have
to be paid out of those undertakings’ budgets.

this aid with the common market.

the employees of

It

it

is

that

to the minimum wage for

sailors would be paid a share of

in line with the
the one hand because
Community principles guaranteeing employees a fair
minimum income and on the other because the
system of payment by means of a share of profits is
particularly unfavourable to French sailors. This is
because, under the principle of subsidiarity, the rules
on minimum wages fall entirely within the juris­
diction of the Member States. In France, as regards
sailors’ wages,
laid down in
this obligation is
the
Articles L.742-2, D.742-1 and D.742-2 of
Labour Code. As recalled by a judgment of
the
Rennes Court of Appeal of 16 June 1998 (28), those
provisions, which apply generally, apply to employees
covered by the Maritime Labour Code, whatever the
method of remuneration adopted. The fact that the
shipowner and his or her employees agreed at the
start
the
(potential) profits does not exempt
the shipowner
from guaranteeing the sailors’ remuneration at least
equal
the period in
which they are on board. In other words, the share
of profits in the fishing industry must be at least
equivalent
in
accordance with the growth-indexed minimum wage.
the Maritime Labour
In this respect Article 34 of
Code (29) refers to ‘a national
trades agreement or
extended branch agreements [for laying down], inde­
pendently of the actual time worked, the period(s) for
calculating the growth-indexed minimum wage for
share-fishermen’. The branch agreement, Article 9(1)
of which guarantees a minimum gross annual re­
muneration for
signed on
28 March 2001 (30). This provision was made
employees
compulsory,
covered by this agreement, by an interministerial
decree of 3 July 2003 (31). The wage cost produced
by this legal obligation is thus part of the running
costs of fisheries undertakings, the same as expen­
diture on fuel. Under
the
Commission therefore cannot accept
the argument
that the French State is justified in intervening finan­
cially because shipowners are failing to meet their
legal obligation to ensure a minimum wage for their
employees, even where they are share-fishermen.

share-fishermen, was

circumstances,

remuneration

employers

calculated

these

and

the

for

all

to

4. Similarly, the Commission cannot accept the claim
that the aid for employees’ income is authorised, on

(27) Judgment of the Court of Justice in Case C-251/97 French Republic v

Commission [1999] ECR I-6639, paragraph 35.

(28) Judgment of the Rennes Court of Appeal of 16 June 1998 Marziou
v Louzaouen, in Le Droit Maritime Français, No 588, December 1998,
p. 1201 et seq. (Editions Lamy).
(29) Available at www.legifrance.gouv.fr/
(30) Official bulletin of the Ministry of Infrastructure No 13 of 25 July
2003, available at www2.equipement.gouv.fr/bulletinofficiel/fiches/
BO200313/Une.htm

(31) Published in the Journal officiel de la République française 203 of

3 September 2003, p. 15051.

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(124) According to MQA, the measures in question may also
be socioeconomic measures: ‘the guidelines (…) state that
socioeconomic measures may be declared compatible. In
this particular case, the FPAP is completely transparent
and the schemes classified as aid by the Commission
have an obvious socioeconomic character’.

the Fund’s activities, despite the requests made during the
procedure. Lastly, it notes that it was never informed of
the audit mentioned by MQA, nor a fortiori of
its
conclusions, which
authorities were
the
requested to provide by mid-November 2005.

French

be

socioeconomic measures may

(125) The Commission notes that MQA has not provided any
evidence enabling the aid in question to be examined
under point 4.5 of the Guidelines, which provide that,
on a case-by-case basis, direct aid for workers equivalent
to
considered
compatible with the common market. This is because
that point specifies that they may only be considered
compatible ‘provided that it forms part of socioeconomic
back-up measures compensating income losses linked to
measures designed to achieve an adjustment of capacity
adopted pursuant to Article 11(1) of Regulation (EC) No
2371/2002’ (Council Regulation (EC) No 2371/2002 of
20 December 2002 on the conservation and sustainable
exploitation of
fisheries resources under the common
fisheries policy (32)). However, the creation of the FPAP
is not part of an overall plan for the adjustment of
fishing capacity adopted under Regulation (EC) No
2371/2002. Therefore in no way does the argument
put
such
forward by MQA justify the grant of
operating aid.

(126) MQA also points out that it is not correct to state that
the aid was granted unconditionally. According to MQA,
‘as a condition for granting these loans the State required
the FPAP to produce various supporting documents so as
to be able to ensure proper management of funds and
establish that the Fund and its members were determined
the new
to implement
for
sector’. MQA
production conditions
points to this transparent accounting requirement and
the State Decision to request
that an interministerial
audit be carried out.

in the fisheries

sustainable

solutions

(128) Consequently,

that

the Commission considers

the
advances granted by the State do in fact fall under the
category of operating aid referred to in point 3.7 of the
‘State aid which is
Guidelines, according to which:
granted without
imposing any obligation serving the
objectives of the Common Fisheries Policy on the part
of recipients and which is intended to improve the
situation of undertakings and increase their business
liquidity (…) is, as operating aid, incompatible with the
common market’. These advances are therefore incom­
patible with the common market.

5. CONCLUSION

(129) The Commission holds

in breach of
Article 88(3) of the Treaty, has unlawfully implemented
the various aid schemes which are the subject of this
Decision.

that France,

(130) On the basis of the analysis developed in part 4.1 of this
Decision, the Commission considers that the FPAP’s ad­
ditional business liquidity resulting from the granting of
three, or possibly four, advances
totalling EUR 65
million, or possibly EUR 77 million, constitutes State
aid incompatible with the
common market under
the Treaty. This is because,
Article 87(2) and (3) of
since no bank would have granted advances such as
those granted to the FPAP and, according to the infor­
mation available, the advances have not been repaid, the
advances have become a direct subsidy (see recital 67)
and therefore State aid covering the amount in question.

(127) The Commission notes the transparency and monitoring
requirement, but observes that this would appear to be
is assistance
this
an elementary requirement,
financed out of public funds. However,
it regrets that,
in such a context of transparency, the French authorities
did not send it all the detailed figures and information on

since

(32) OJ L 358, 31.12.2002, p. 59.

(131) On the basis of the analysis developed in part 4.2 of this
Decision, the Commission considers that the aid granted
in the form of advances to the FPAP and which enabled
fisheries undertakings to buy fuel at an advantageous
price and to benefit
from a compensatory allowance
under the diesel insurance, constitutes State aid incom­
patible with the common market under Article 87(2) and
(3) of the Treaty.

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6. RECOVERY

(132) The amount of State aid paid by France is EUR 65
million, or EUR 77 million if a fourth agreement
existed. In accordance with Article 14(1) of Regulation
(EC) No 659/1999, where negative Decisions are taken in
cases of unlawful aid, the Commission must decide that
the Member State concerned must
take all necessary
measures to recover the aid from the beneficiary. The
purpose is achieved once the aid in question, together
where appropriate with default interest, has been repaid
by the recipient or, in other words, by the undertakings
which actually benefited from it (33). The purpose of the
recovery will therefore be achieved when this amount of
EUR 65 or EUR 77 million has been repaid.

(133)

In order to determine what has to be recovered from the
FPAP on the one hand and the fisheries undertakings on
the other, account should be taken of the fact that the
objective of the FPAP, although it acts as an economic
operator on the futures markets, is to grant allowances to
fisheries undertakings under the diesel insurance system
which it set up, and to provide them with fuel at an
advantageous price. The analysis made in this Decision
of the general operation of this particular system shows
that the FPAP fulfilled its mission by gradually trans­
ferring the aid granted by the State. For that reason,
the aid to be recovered from the FPAP is the part of
the EUR 65 or EUR 77 million which was not trans­
ferred to the fisheries undertakings, and the aid to be
recovered from the fisheries undertakings is therefore
the part which was transferred to them.

(134) The Commission is not aware of the amount which was
actually transferred by the FPAP to the fisheries under­
takings.
In this connection the Commission observes
that, despite an injunction addressed to France to
the necessary information on the FPAP’s
provide all
operation, it has not forwarded any details of how the
Fund’s financial resources were used or of its accounts. In
the absence of this information and in order to take
account of the Court’s Decisions (34), the Commission
thinks it useful to provide guidelines on the methodology
to be used for determining the amount of aid to be
recovered.

(135)

In laying down these guidelines, the Commission took
into account the fact that, under the agreements, the
FPAP is required to keep accounts so that information
on how the advances have been used and resources and
expenditure have been allocated can be obtained, and
undertook to keep the accounting documents for a
minimum period of ten years, and make them available

to the various State bodies on request (see recital 27). On
the basis of this information, the authorities or bodies
instructed to apply the recovery Decision will be able to
obtain information on the FPAP’s liquid assets and the
cash situation at the time the Decision has to be im­
undertakings’
plemented. Also,
the
accounts are normally kept by management groups
belonging to the Centre de gestion de la pêche artisanale
(Small-Scale Fishery Management Centre), which is rep­
resented on the FPAP’s Board of Directors,
it is also
possible to identify the allowances paid by the FPAP in
the undertakings’ accounts.

fisheries

since

6.1. Recovery from the FPAP

(136) The amount of incompatible aid to be recovered from
the FPAP is equivalent to that part of the State aid which
was not ultimately transferred to the fisheries under­
i.e. the amount of the advances which funded
takings,
the operating costs of the FPAP and the amount of the
advances that it kept as liquid assets. It will be possible
for the authority instructed to implement recovery to
find out the total amount of the operating costs from
the FPAP’s accounts. Given the fungible nature of money
and the impossibility of knowing what money is used
where,
the
proportion of State advances which financed these
operating costs is the total amount of those expenses
multiplied by the ratio of the advances to the sum of
the advances and the FPAP’s own funds (its members’
contributions).
the
advances kept as liquid assets can be determined by
multiplying the remaining liquid assets by the same ratio.

the Commission takes

In the same way,

the amount of

view that

the

6.2. Recovery from the fisheries undertakings

(137) As indicated above, the aid to be recovered from the
fisheries undertakings as a whole is equivalent to the
EUR 65 or 77 million of advances, less the amount to
be recovered from the FPAP in accordance with the
details given in recital 136. As regards the State aid to
those undertakings,
be recovered from each one of
is not
it
account must be taken of
possible, from an accounting point of view, to make a
distinction between aid which is classified as State aid
and aid which is not
imputable to the State (see
paragraph 4.2.1.2 of this Decision).

the fact

that

(33) Judgment of the Court of

Justice in Case C-277/00 Germany v

Commission [2004] ECR I-3925, paragraph 75.

(34) Judgment of

the Court of

Justice in Case C-480/98 Spain v

Commission [2000] ECR I-8715, paragraph 25.

(138) The Commission takes the view that the State aid to be
recovered from each undertaking can be calculated on
the basis of the allowance received by each undertaking
under the diesel insurance.

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allowances

it obtained,

the purchase of

fuel at a price lower

(139) By taking this allowance as the basis for calculation, the
Commission leaves aside the subsidy-equivalent of the
saving made by each fisheries undertaking as a result
than the
of
is
it
that
market price. The Commission considers
justified to do so because the undertakings which
benefited from preferential prices for their fuel are the
same as those which benefited from the allowances
under the diesel insurance. They did this in completely
comparable respective proportions since the more one
fuel at a preferential price the
undertaking bought
more
versa. By
and vice
choosing this basis, no element of distortion is thus
introduced between the undertakings
concerned in
relation to the repayment obligations which they will
have to meet. Also, the Commission notes that, if these
subsidy-equivalents were to be taken into account in the
basis for calculation,
it would be necessary for this
purpose to calculate, for each purchase of fuel carried
out in the FPAP’s period of activity on the oil futures
markets, the difference between the expenditure which
would have resulted from purchase during the day in
question and the cost actually invoiced by the coop­
erative after having determined what the price on the
day applicable would have been for the type of
fuel
bought at the particular place of supply. This method
would have been more difficult to implement. That is
why
to
recommend a basis for calculation which will facilitate
the task of
the authorities and bodies instructed to
implement the recovery Decision.

Commission

preferable

thinks

the

it

(140) Consequently, the Commission considers that the State
aid to be recovered from each undertaking can be
the allowance received by
calculated on the basis of
each undertaking under the diesel
insurance. The State
aid to be recovered must be calculated by multiplying
that allowance by a percentage corresponding to the ratio
of the overall amount of the State aid to be recovered
from the fisheries undertakings to the overall amount of
the allowances paid to the fisheries undertakings by the
FPAP under the diesel insurance.

(141) The amount to be recovered from each fisheries under­
taking must thus be calculated according to the following
formulas:

R (cid:1) Und ¼ I (cid:2)

ðAdvances – R (cid:1) FPAPÞ
Total I

Where:

R*Und

= amount to be recovered from the fisheries

undertaking

I

= amount of
fisheries
insurance

the allowance received by the
diesel
under

undertaking

the

Advances = EUR 65 or 77 million

R*FPAP = amount to be recovered from the FPAP in
accordance with the details given in recital
136

Total I

= total amount of the allowances paid by the
FPAP to the fisheries undertakings under the
diesel insurance

(142) This formula takes account of the supposition that the
FPAP made profits on the futures markets which were
then passed on completely to the fisheries undertakings.
As described in this Decision, that is the most plausible
case. However, consideration should also be given to the
theoretical case in which the FPAP made losses on the
futures markets, with the result that the fisheries under­
takings would have received an overall amount of
allowances lower than the amount of the advances less
the amount to be recovered from the FPAP. In such a
case, the quotient (Advances – R*FPAP)/Total
I would
generally be greater than 1, in particular if the amount
‘R*FPAP’
the above formula
would therefore mean that the overall amount to be
recovered from the fisheries undertakings would be
higher than that which they received. For that reason,
in this particular case,
to be recovered
from each undertaking should be the amount of the
allowance received by the undertaking under the ‘diesel
insurance’. In this particular case, the balance of the State
advances and the allowances paid to the fisheries under­
takings would have to be recovered from the FPAP,
which would actually have retained that difference.

is small. Application of

the amount

(143) State aid for the fisheries undertakings cannot be made
subject
to recovery if, on the date on which it was
granted, it meets the conditions of Regulation (EC) No
1860/2004 or Regulation (EC) No 875/2007 on de
minimis aid,

HAS ADOPTED THIS DECISION:

Article 1

The aid granted to the Fund for the prevention of risks to
fishing (FPAP) for the acquisition of financial options on the
oil futures market and implemented unlawfully by France in
breach of Article 88(3) of the Treaty is incompatible with the
common market.

Article 2

The aid granted to fisheries undertakings in the form of a
reduction of their fuel expenditure and unlawfully granted by
France in breach of Article 88(3) of the Treaty is incompatible
with the common market.

12.12.2008

EN

Official Journal of the European Union

L 334/87

Article 3

aid granted to a

Individual
fisheries undertaking under
Article 2(1) of Council Regulation (EC) No 994/98 (35) shall
not be subject
it
meets the conditions laid down by the regulation adopted
under Article 2 of Regulation (EC) No 994/98 applicable at
the time the aid was granted.

to recovery if, at

the time it

is granted,

France shall keep the Commission informed of
the national measures taken to implement

the
2.
progress of
this
Decision until recovery of the aid referred to in Article 1 has
been completed. It shall immediately submit, on simple request
by the Commission, information on the measures already taken
and planned to comply with this Decision. It shall also provide
detailed information concerning the amounts of aid and
recovery interest already recovered from the FPAP.

Article 4

Article 7

France shall recover the incompatible aid referred to in

1.
Articles 1 and 2 from the beneficiaries.

2.
The sums to be recovered shall bear interest from the date
on which they were placed at the disposal of the beneficiaries
until their actual recovery.

The interest shall be calculated on a compound basis in
3.
accordance with Chapter V of Commission Regulation (EC) No
794/2004 (36).

1. Within two months of notification of
France
shall
Commission:

following

submit

the

this Decision,
information to the

(a) a list of fisheries undertakings that have received aid as
referred to in Article 2 and the total amount of aid
received by each of them;

(b) the total amount (principal and recovery interests) to be

recovered from each beneficiary;

France shall cancel all outstanding payments of the aid
4.
referred to in Articles 1 and 2 with effect from the date of
adoption of this Decision.

(c) a detailed description of the measures already taken and

planned to comply with this Decision;

Article 5

(d) documents demonstrating that the beneficiaries have been

ordered to repay the aid.

France shall keep the Commission informed of
the national measures taken to implement

the
2.
progress of
this
Decision until recovery of the aid referred to in Article 2 has
been completed. It shall immediately submit, on simple request
by the Commission, information on the measures already taken
and planned to comply with this Decision. It shall also provide
detailed information concerning the amounts of aid and
recovery interest already recovered from the beneficiaries.

Article 8

This Decision is addressed to the French Republic.

Done at Brussels, 20 May 2008.

For the Commission

Joe BORG
Member of the Commission

Recovery of the aid referred to in Articles 1 and 2 shall be

1.
immediate and effective.

France shall ensure that

2.
within four months of the date of its notification.

this Decision is implemented

Article 6

1. Within two months of notification of
France
shall
Commission:

following

submit

the

this Decision,
information to the

(a)

the total amount (principal and recovery interests) to be
recovered from the FPAP;

(b) a detailed description of the measures already taken and

planned to comply with this Decision;

(c) documents demonstrating that the FPAP has been ordered

to repay the aid.

(35) OJ L 142, 14.5.1998, p. 1.
(36) OJ L 140, 30.4.2004, p. 1.