2008/848/EC: Commission Decision of 16 July 2008 on State aid C 14/07 (ex NN 15/07) implemented by Italy for NGP/SIMPE (notified under document number C(2008) 3528) (Text with EEA relevance)
Date: 2008-07-16
Institutions: European Commission
Subjects: Italy, State aid, control of State aid, exchange of information, financial aid, man-made fibre

L 301/14

EN

Official Journal of the European Union

12.11.2008

COMMISSION

COMMISSION DECISION

of 16 July 2008

on State aid C 14/07 (ex NN 15/07) implemented by Italy for NGP/SIMPE

(notified under document number C(2008) 3528)

(Only the Italian text is authentic)

(Text with EEA relevance)

(2008/848/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 regard to the Agreement on the European Economic
Area, and in particular Article 62(1)(a) thereof,

Having called on interested parties to submit their comments
pursuant to the provisions cited above (1) and having regard to
their comments,

Whereas:

(1)

(2)

1. PROCEDURE

On 14 July 2006 Italy notified its intention to grant
restructuring aid to NGP SpA (NGP). Missing annexes
were submitted by letter dated 28 July 2006. The
Commission had previously received three complaints
claiming that Italy intended to grant aid to NGP which
would affect the synthetic fibre market.

the Commission
By letter dated 22 August 2006,
requested additional
information which Italy submitted
by letter dated 14 December 2006. On 12 February
2007 it
information which Italy
submitted by letter dated 7 March 2007, registered as
received on 8 March.

requested further

(3)

(4)

(5)

(6)

(7)

By letter dated 10 May 2007, the Commission informed
Italy that it had decided to initiate the procedure laid
down in Article 88(2) of the EC Treaty in respect of
the aid.

in the context of

Italy presented its
By letter dated 16 July 2007,
the above mentioned
comments
infor­
procedure. The Commission requested further
mation by letter dated 25 October 2007,
to which
Italy replied by letter of 23 November 2007. A
meeting
the
Commission departments took place on 13 December
2007. The Commission requested additional clarification
by letter dated 8 February 2008, to which Italy replied by
letter dated 25 February 2008. Italy submitted additional
final comments by e-mail of 22 May 2008.

Italian authorities

between the

and

The Commission decision to initiate the procedure was
published in the Official Journal of the European Union (2).
The Commission called on interested parties to submit
their comments.

The Commission received comments from interested
parties. It forwarded them to Italy, which was given the
opportunity to react;
its comments were received by
letter dated 21 September 2007.

2. DESCRIPTION

2.1. The beneficiary

According to the notification, the beneficiary of the aid is
NGP, a firm located in Acerra, Campania (Italy). NGP was
created in February 2003 through the divestment of the
production of polyester polymer (polymerisation) from
Montefibre, a producer of polyester fibre also located in
Acerra. Polyester polymer is an intermediate product
used,
in the production of
polyester fibre.

among other

things,

(1) OJ C 131, 13.6.2007, p. 22.

(2) See footnote 1.

12.11.2008

EN

Official Journal of the European Union

L 301/15

(8)

(9)

The assets of NGP comprised two production plants as
well as a thermoelectric power station, some ancillary
facilities and a research centre. The first production
plant produced the
intermediate product dimethyl­
terephthalate (DMT). DMT was the raw material for the
second production plant, the polymerisation plant. The
second plant produced polymer either in molten state to
supply the production plant of Montefibre or in the solid
state in the form of chips for the external market.

was to change the raw material used for the polymeri­
sation plant,
replacing own-production DMT with
another raw material, purified terephthalic acid (PTA),
in order to create a more flexible cost structure. It was
estimated that a further EUR 22 million would be needed
for the raw material changeover. Because of insufficient
financial means, NGP would not have been able to
complete these investments.

(CP1, CP2 and CP3). Of

The polymerisation plant operated with three production
lines,
these, CP3 had been
created in 2003. Italy had granted regional aid of EUR
13,7 million for the investments in CP3. The aid had
been provided under a regional aid scheme approved
by the Commission (3).

(14)

In May 2004 a protocol of understanding (protocollo di
intesa) was concluded between several public authorities,
Montefibre, NGP and other companies in which all
parties agreed to the need to safeguard the investments
already carried out for CP3 and to finalise them.

2.2. The financial difficulties of NGP

(10) NGP quickly ran into difficulties after its creation for
In 2003 a breakdown of the cooling
several reasons.
broken
production. Although
system halted
equipment was provisionally replaced,
the production
plant did not return to full operation. The situation
was aggravated by strong pressure on prices due to the
weakening of the US dollar exchange rate, which made
producers outside the euro area more competitive.

the

(15)

(16)

(11) Moreover, the costs of production of DMT were to a
large extent fixed costs, which are independent of the
volumes produced. The reduced volume of chips and
molten polymer
sold led to reduced production of
DMT, which, however, resulted in only a small decrease
in total production costs because of the large share of
fixed costs.
In turn, unit production costs of DMT
therefore increased considerably.

(12) NGP recorded losses of EUR 29,68 million in 2003, its
last year of full production, and losses of EUR 17,87
million in 2004.
recorded
profits of EUR 5,27 million, which were largely due to
extraordinary revenues.

In 2005 it nevertheless

and regional

In July 2005 an agreement (accordo di programma) was
authorities, NGP,
signed by national
Montefibre and Edison (another firm located in Acerra)
concerning the NGP site as well as other activities at the
Acerra site. The main elements of
this agreement
concerning NGP were as follows:

creation of a new firm, SIMPE SpA, in July 2005, with
NGP as the majority shareholder and with Montefibre
(19,1 % of the share capital) and a public development
agency, Sviluppo Italia (9,8 % of the share capital) as
minority shareholders. SIMPE would take over the poly­
merisation activities of NGP (i.e. production assets plus
related liabilities) and part of the workforce. NGP would
remain in activity only as a utilities provider (4);

(17)

closure of the DMT production plant and realisation by
the new firm, SIMPE, of the planned investments in line
CP3 with a view to replacing the original own-
production DMT with a new raw material, purified
terephthalic acid (PTA),
to be acquired from outside
sources (5);

2.3. The restructuring plan

(13)

In January 2004 the board of the firm took the decision
to suspend production and to draw up a project
to
facilities. The objective
convert

the existing industrial

(3) N 715/1999 (OJ C 278, 30.9.2000, p. 26).

(18)

granting by Italy of financial support measures totalling
EUR 20,87 million to support the investments in the raw
material changeover. These measures are described below.

(4) NGP would become a provider of technological, environmental and
energy services and would continue to run the research centre.

(5) The raw material

initially produced and used by NGP (DMT) had
high fixed costs which, at times of low demand, generated high unit
costs. According to Italy,
the new raw material, PTA, makes
production costs more flexible and allows for a wider range of
industrial applications.

L 301/16

EN

Official Journal of the European Union

12.11.2008

2.4. Financial support

(19)

The first measure consists of a grant of EUR 10,75
million, of which EUR 5 million to be provided by the
Region of Campania and the remainder by the Ministry
of Industry. The measure was granted on 18 May 2006.

(20)

The second measure consists of a soft loan of EUR 6,523
million provided by the Ministry of Industry at a reduced
interest rate (36 % of the reference rate). The loan was
granted on 18 May 2006.

(26)

(21)

The third measure consists of a temporary participation
of EUR 3,6 million in the risk capital of SIMPE by
Sviluppo Italia (9,8 % of
the company capital). The
injection was made on 5 May 2006. The two other
shareholders
in SIMPE, NGP and Montefibre, were
required to buy the shares from Sviluppo Italia within
a period of three to five years at a price equal to the
interest on the basis of the
nominal value plus annual
official
to long-term
reference
operations plus two percentage points.

for medium-

rate

(22) All three measures were granted to SIMPE.

(23)

(24)

2.5. New developments

In February 2007 the Spanish multinational chemical
company, La Seda de Barcelona, acquired the Montefibre
shares in SIMPE and invested additional capital of EUR
20,7 million in the firm, thus becoming its major share­
holder with 50,1 % of shares. The other shareholders
were NGP with 43,6 % and Sviluppo Italia with 6,3 %.

changes

to the original

The acquisition of SIMPE by La Seda de Barcelona also
meant
restructuring plan.
Whereas, according to the plan agreed in July 2005
(see above), SIMPE would continue in the same line of
i.e. producing mainly polymer for
business as NGP,
textile applications, SIMPE now planned to concentrate
production mostly on polymer for the market in PET
(polyethylene terephthalate), a plastic material of which
La Seda de Barcelona is one of the EU’s largest producers.

3. GROUNDS FOR INITIATING THE FORMAL

INVESTIGATION PROCEDURE

3.1. Restructuring aid

in

the

Community
(hereafter
difficulty
firms
guidelines) (6). The Commission,
in its decision to
initiate
under
formal
Article 88(2) of the Treaty, stated that it had doubts as
to whether the conditions of the Community guidelines
were fulfilled.

investigation

procedure

the

The Commission expressed doubts as to the actual ben­
eficiary of the aid and its eligibility. Italy had notified
NGP as the beneficiary of the aid. However, all three
measures were granted to the new firm SIMPE, which,
as a newly created firm, was not eligible for restructuring
aid (point 12 of
the Community guidelines). The
Commission,
therefore, questioned whether NGP and
SIMPE, as a group, could qualify for the aid: SIMPE
had been created by NGP in the context of the restruc­
turing of the polymerisation assets, for which the aid
measures in question were granted. On the other hand,
NGP was not a newly created firm within the meaning of
the Community guidelines and, what is more, appeared
to be a firm in difficulty and therefore eligible for
restructuring aid

(27) However, even if NGP and SIMPE could be considered to
form a single group eligible for aid, the Commission had
doubts concerning the remaining criteria laid down in
the Community guidelines. In particular, Italy had not
submitted restructuring plans complying with all
the
requirements of Section 3.2.2 of
the Community
guidelines for either SIMPE or NGP. As regards SIMPE,
the business plan submitted by Italy did not contain a
detailed market survey or an analysis of the firm’s specific
weaknesses and strengths. Nevertheless, the Commission
noted that SIMPE had in the meantime been sold to
the
another
Commission could not assess at that stage. Regarding
NGP, Italy had not provided any indication of the costs
of the restructuring measures to be implemented and
their precise financing. On the basis of the information
available,
the
conditions relating to the restoration of viability were
fulfilled.

doubted whether

the Commission

consequences

of which

firm,

the

(28)

Italy had also not indicated any compensatory measures
to SIMPE or NGP. The Commission
with respect
therefore doubted whether the condition of avoidance
of undue distortions of competition was
respected.
Similarly, it had no information concerning total restruc­
turing costs or the beneficiary’s contribution, and this
would be necessary to determine whether the aid was
limited to the minimum in compliance with the
Community guidelines.

(25)

Italy notified the aid on the basis of the Community
guidelines on State aid for rescuing and restructuring

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

12.11.2008

EN

Official Journal of the European Union

L 301/17

(29)

Finally, Italy had at the outset notified the capital contri­
bution by Sviluppo Italia as aid but later claimed that it
was granted on market terms and was not aid. However,
the Commission had doubts about this argument.

(33)

The new restructuring plan

Italy argued that, if the Commission could not agree that
the aid falls within scheme N 214/2003, it should, in the
alternative,
the aid is compatible as
restructuring aid.

consider

that

3.2. Guidelines on national regional aid

(34)

Italy claimed that the beneficiary of the aid is NGP, which
qualifies as a firm in difficulty.

(30)

(31)

equivalent) of

The Commission also assessed whether the aid could be
considered compatible on the basis of the guidelines on
national regional aid (7). SIMPE is located in an area
eligible for regional aid pursuant to Article 87(3)(a) of
the Treaty, where the regional aid ceiling is 35 % nge (net
grant
investments. The
measures were intended to enable SIMPE to carry out
the investment projects on line CP3. However,
the
Commission had no information that would allow it to
assess whether the costs concerning the investments in
line CP3 could be considered eligible for
regional
investment aid or whether the regional aid ceiling of
35 % had been respected.

eligible

the

4. COMMENTS FROM ITALY

Regarding the aid measures, Italy again stated that the
temporary participation by Sviluppo Italia in the capital
of SIMPE does not qualify as State aid because it is in line
with the market economy investor principle.
It main­
tained that the other two shareholders in SIMPE (NGP
and La Seda de Barcelona) are required to buy the shares
of Sviluppo Italia within a period of three to five years at
a price equal to the nominal value plus annual interest
on the basis of the official reference rate for medium- to
In
long-term operations plus two percentage points.
addition,
is backed by guarantees
provided by NGP in respect of its assets. According to
Italy, any private investor would have invested with such
guarantees of a return on capital.

this commitment

(32)

Italy also stated that
two measures were
the other
granted to SIMPE under a national scheme — Italian
Law 181/89 — approved by the Commission (N
214/2003) (8) and that both the eligible costs and the
aid intensity complied with the conditions of
that
scheme,
i.e. maximum regional aid intensity of 35 %
nge. Italy argued that, even if it had notified the aid as
restructuring aid to NGP, the aid could therefore, in its
view, be considered as regional aid to SIMPE under this
scheme.

(35)

Italy also submitted an amended restructuring plan for
both NGP and SIMPE taking into account
the new
strategy of La Seda de Barcelona.

(36) As explained above, according to this plan, SIMPE will
produce mainly polyester polymer from line CP3 for the
PET market. Italy submitted a market study showing that
the plastic packaging material market
steadily
expanding, with an increase in demand of about 7 % a
year (9).
In addition, SIMPE will continue to produce
polyester polymer from lines CP1 and CP2 for Fidion,
a company to which Montefibre has transferred its
polyester fibre production.

is

(37) NGP will remain in activity as a supplier of utilities and
other services, such as research and laboratory services
and treatment of waste water for the industrial businesses
in Acerra, but will abandon all
industrial production
activities. Of the original 270 NGP employees, the firm
will keep 54, with 76 of
them being transferred to
SIMPE.

(38)

The new restructuring plan includes investments of EUR
8,5 million by NGP for modernising the utilities infra­
structure. As regards SIMPE,
the firm will undertake
investments totalling EUR 40,4 million, of which EUR
22 million will be for changing over to the new raw
material (PTA) in line CP3, as proposed in the original
plan, and the remainder for developing a new ‘post-poly­
merisation’ process necessary to complete the PET
production cycle and for adapting lines CP1 and CP2
also to the use of PTA.

(39)

Italy supplied a table with details of the restructuring
costs and sources of
financing for both NGP and
SIMPE. According to this table, the total restructuring
costs amount to EUR 103,5 million.

(7) OJ C 74, 10.3.1998, p. 9.
(8) OJ C 284, 27.11.2003, p. 2.

(9) 2004 figures.

L 301/18

EN

Official Journal of the European Union

12.11.2008

(40)

The new plan presents a range of scenarios — best case,
intermediate and worst case — for NGP and SIMPE re­
spectively. NGP will become profitable — even under the
worst case scenario — as early as 2009. As regards
the results would not be positive until 2011
SIMPE,
under a worst case scenario, by 2010 under the inter­
mediate scenario; and as early as 2009 under the best
case scenario.

5. COMMENTS BY THIRD PARTIES

(41) NGP supported the comments made by Italy. The Inter­
national Rayon and Synthetic Fibres Committee (CIRFS),
one of the original complainants, noted that, if the aid is
intended mainly for the PET market, it is of no relevance
to synthetic fibre production.

6. ASSESSMENT

6.1. State aid within the meaning of Article 87(1) of
the EC Treaty

by

(42) Under Article 87(1) of the EC Treaty, any aid granted by
a Member State or through state resources in any form
whatsoever which distorts or threatens to distort compe­
tition
the
certain
favouring
production of certain goods is,
insofar as it affects
trade between Member States,
incompatible with the
the
common market. Under the settled case law of
Court, the criterion of trade being affected is met if the
beneficiary
activity
involving trade between Member States.

firm carries out

an economic

undertakings

or

(43)

The grant and the loan were provided to SIMPE by the
Ministry of Industry and the Region of Campania, two
public authorities. The measures are
financed
through state resources and imputable to the State. The
grant confers an advantage on the beneficiary. The loan
also confers an advantage as it was granted at an interest
rate below the reference rate for healthy businesses and
no market
economy investor would have granted
assistance under these conditions.

thus

(44) As regards the capital contribution provided to SIMPE by
Sviluppo Italia, Italy first notified the measure as State aid
but then later claimed that it was not aid as it was in line
with the market economy investor principle and did not
confer an advantage on the firm.

Sviluppo Italia is a public development agency and
therefore capital injections by this agency are imputable
to the State and constitute state aid, unless it can be
established that Sviluppo Italia behaved like a private
investor operating under market economy conditions.

(46)

(47)

(48)

the

restructuring of NGP,

In this respect the Commission notes that the partici­
pation by Sviluppo Italia in the capital of SIMPE was
part of the restructuring plan of NGP. As NGP was a
firm in difficulty and as SIMPE was created only for the
can be
purposes of
considered that Sviluppo Italia decided to acquire shares
in a firm in difficulty. Moreover, Sviluppo Italia’s capital
injection was combined, as part of the same operation,
with two other measures which qualify as State aid under
Article 87(1), namely a direct grant from the Region of
Campania and the Ministry of Industry and a soft loan
from the Ministry of Industry.

it

a healthy firm. The market

In previous decisions (10) the Commission has found that
the market economy investor principle is respected in the
injections where the firm in
case of public capital
question is
economy
investor principle can also be fulfilled even if the firm
is in difficulty. In this case, however, the State has to
provide capital on the same terms as a private investor
would do for such a high-risk firm: namely at a much
higher interest rate than for healthy firms and with a
clear prospect of a return to viability.

The Italian authorities have not provided evidence that a
private investor would be prepared to acquire shares in
the same circumstances. In fact, there is no evidence that
the return on capital on the terms contracted by
Sviluppo Italia (i.e.
two percentage points above the
reference rate) would be sufficient to trigger the interest
of a private investor, bearing in mind that NGP had
ceased activity and that there was no certainty (other
than the fact that the investment was being supported
by state aid) of a return to viability. In this respect,
it
should also be noted that La Seda de Barcelona acquired
the participation in SIMPE only nine months after the
capital
injection by Sviluppo Italia and after the other
forms of aid had been granted.

(45) However, contrary to the view of the Italian authorities,
the Commission considers that the temporary partici­
pation by Sviluppo Italia in the capital of SIMPE
constitutes aid within the meaning of Article 87(1).

(49)

the capital
The Commission therefore concludes that
contribution by Sviluppo Italia conferred an advantage
on the firm.

(10) N 132/1999 Parco Navi, N 191/1998 Pomella and N 652/1999

Granarolo.

12.11.2008

EN

Official Journal of the European Union

L 301/19

(50) NGP and its successor SIMPE produce polyester polymer.
As this product is widely traded across the European
the measures threaten to distort competition
Union,
trade between Member States. The
and to affect
the loan
Commission thus concludes that
and the capital
injection by Sviluppo Italia constitute
State aid within the meaning of Article 87(1) of the EC
Treaty and that
to be
assessed accordingly.

their compatibility has

the grant,

thus

6.2. Legal basis

the formal

In its decision to initiate
investigation
procedure, the Commission questioned whether the aid
could be considered compatible under the Community
guidelines on state aid for rescuing and restructuring
firms in difficulty and under the guidelines on national
regional aid.

the

the

Italy,

comments

submitted by
that all

the
Following
Commission notes, however,
elements
concerning a restructuring process seem to be present
in this case. At the time the aid was granted, NGP was
a firm in difficulty. The aid was granted with the aim of
the firm on the basis of a
restoring the viability of
restructuring plan that
Italian authorities were
the
committed to implement (see the terms of the accordo
di programma in point 15 above). Further, even if,
according to the Italian authorities, the aid was granted
to SIMPE (and not NGP), SIMPE was created only for the
purposes of the restructuring of NGP and is thus part of
this restructuring plan. Finally, both NGP and SIMPE
benefit from the aid.

6.3. Eligibility of the firm

(55) According to Section 2.1 of the Community guidelines,
the Commission considers a firm to be in difficulty
where it is unable, whether through its own resources
or with the funds it is able to obtain from its owner/
shareholder or creditor, to stem losses which, without
outside
intervention by the public authorities, will
almost certainly condemn it to go out of business in
the short or medium term. The usual signs of a firm
in difficulty are increasing losses, diminishing turnover,
growing stock inventories, excess capacity, declining cash
flow, mounting debt, rising interest charges and falling or
nil asset value. In acute cases the firm may already have
become insolvent or may be the subject of collective
insolvency proceedings.

(56) A newly created firm is not eligible for rescue and
restructuring aid even if
financial position is
insecure. A firm will normally be considered as newly
created for the first three years following the start of
operations in the relevant field of activity.

its

(57) On the other hand, point 13 of

the Community
guidelines states that ‘where a firm in difficulty creates
a subsidiary, the subsidiary, together with the firm in
difficulty controlling it, will be regarded as a group and
may receive aid under the conditions laid down in this
point.’

The Commission also notes that, given the potential for
distortion of competition that aid for the restructuring of
firms in difficulty entails, the Community guidelines on
State aid for rescuing and restructuring firms in difficulty
the
contain specific criteria designed to ensure that
granting of aid is limited to the minimum required to
restore a firm’s viability, while limiting distortions of
competition by the obligation imposed on the beneficiary
to adopt compensatory measures. These criteria could be
instead,
sidestepped should the measures be assessed,
under the guidelines on national regional aid, which in
any event cannot apply to firms in difficulty (11).

(58)

(59)

reasons

explained above,
the compatibility of

the Commission
For
the
concludes that
the aid is to be
assessed under the Community guidelines on state aid
for rescuing and restructuring firms in difficulty (the
Community guidelines).

(11) See point 4.4 of the guidelines on national regional aid (footnote 7

above).

investigation
In the decision to initiate the formal
procedure,
the Commission doubted whether NGP
could be the beneficiary of the aid because it had been
granted to SIMPE. In addition, SIMPE, as a newly created
firm, was not eligible for restructuring aid pursuant to
Section 2.1 referred to above. The Commission, however,
looked into whether both firms could be considered
together as a group and, as such, be eligible for the aid.

SIMPE was created by NGP in the context of the restruc­
turing of the polymerisation assets for which the aid
measures in question were granted and is therefore an
emanation of the former. On the other hand, NGP was
created in February 2003 and started operations in
i.e. more than three years before the
March 2003,
granting of
is
therefore not a new firm within the meaning of the
the
Community guidelines. Moreover, NGP displays
characteristics of a firm in difficulty. It recorded losses
of EUR 29,68 million in 2003,
full
production, and losses of EUR 17,87 million in 2004.
In 2005 it nevertheless recorded profits of EUR 5.27,
largely due to extraordinary revenues.

the aid measures

its last year of

in May 2006.

It

(51)

(52)

(53)

(54)

L 301/20

EN

Official Journal of the European Union

12.11.2008

(60)

time

Further, NGP was the majority shareholder of SIMPE at
the
firm. The
the aid was granted to this
Commission therefore concludes that both NGP and
SIMPE can be considered as a group eligible for aid
under the Community guidelines.

6.4. Restoration of viability

The granting of aid is conditional on the implementation
of a restructuring plan the duration of which must be as
short as possible. The plan must restore the long-term
viability of the firm within a reasonable time scale and
on the basis of realistic assumptions as to the future
operating conditions. Among other things, the restruc­
include a market survey and the
turing plan must
in viability must derive mainly from
improvement
the
internal measures contained in it
Community guidelines).

(point 35 of

to

the

overcome

restructuring

The Commission considers that
the amended restruc­
turing plan reflecting the changes imposed by La Seda
de Barcelona complies with the requirements of
the
Community guidelines. Italy provided a market analysis
which shows that the market of polymer for PET is in
full expansion. Adequate internal measures are taken
within
problems
inherited from the past (i.e. changeover to a new raw
material), combined with significant new investments
by the new owner La Seda de Barcelona that allow
SIMPE to operate in the market of polymer for PET
while continuing to supply molten polymer for textile
purposes to Fidion. Moreover, Italy presented best case,
worst case and intermediate scenarios based on variations
in production volume which show that NGP and SIMPE
can be expected to return to profitability within a
reasonable
the Commission
considers that the condition on restoration of viability
is fulfilled.

period. Consequently,

(61)

(62)

(63)

6.6. Avoidance of undue distortions of competition

(65)

In order to ensure that the adverse effects on trading
conditions are minimised so that
the positive effects
pursued outweigh them, compensatory measures must
be adopted. Otherwise the aid will be regarded as
‘contrary to the common interest’ and therefore incom­
patible with the common market
the
Community guidelines).

(point 38 of

(66)

Italy proposes the following compensatory measures:

— SIMPE will limit the annual production of polyester
polymer for PET to 110 000 tonnes from the date of
the Commission decision approving the aid until
31 December 2012;

— by the end of February of the following year Italy will
provide the Commission with information on the
quantities of polyester polymer produced and sold
each year by SIMPE, and this until 31 December
2012;

— Italy additionally undertakes to refrain from granting
any type of state aid to SIMPE and NGP or to any
other firm or going concern controlled or otherwise
the
belonging
aid, until
Commission decision authorising the
31 December 2012.

following

to the

group,

same

6.5. Aid limited to the minimum: real contribution
free of aid

the

light of

restructuring

The amount of aid must be limited to the strict
minimum required to enable
to be
existing financial
undertaken in the
resources of the firm and its shareholders. In addition,
beneficiaries are expected to make a significant contri­
bution to the
from their own
restructuring costs
resources or external financing at market conditions. In
the Commission will
the case of
normally consider a contribution of at least 50 % to be
appropriate.

large undertakings,

(67)

Italy explained that, under the restructuring plan, NGP
(or its successor SIMPE) will refrain altogether from
operating in the market
in
granulated form for textiles as well as in special types
of polyester polymer, thereby abandoning 20 % of the
market. In turn, SIMPE expects to achieve a 4 % share of
the EU market in PET.

in polyester polymer

(64) On the basis of the information provided by Italy, about
80 % of the costs of restructuring are financed by the
group’s own resources, thus complying with point 44 of
the Community guidelines.

(68)

‘The
Point 40 of the Community guidelines states that:
measures must be in proportion to the distortive effects
of the aid and in particular (…) the relative importance
of the firm on its market or markets. They should take
place in particular in the market(s) where the firm will
have a significant market position after restructuring.’

12.11.2008

EN

Official Journal of the European Union

L 301/21

(69)

that

the core
The Commission notes in this respect
market
for SIMPE is polyester for PET. Moreover, La
Seda de Barcelona, which is the majority shareholder in
SIMPE, is one of the largest EU producers of polyester
polymer for PET. Therefore the aid is likely to create a
significant distortion of competition in this market. The
production cap of 110 000 tonnes therefore represents a
significant restraint on market presence when compared
with SIMPE’s actual production capacity of polyester for
PET, which is 160 000 tonnes a year. The fact that this
limitation in production will be implemented until 2012
is also of significance considering that PET is a market in
expansion. According to the market analysis provided by
Italy, the increase in demand for this product in 2004
was 6,9 % and this trend is expected to continue.

HAS ADOPTED THIS DECISION:

Article 1

The State aid granted which Italy has implemented for the
restructuring plan of NGP/SIMPE, amounting to EUR 20,87
is compatible with the common market within the
million,
meaning of Article 87(3)(c) of
to the
conditions set out in Article 2.

the Treaty, subject

Article 2

Italy shall ensure that the following conditions are fulfilled:

(70) As

regards

the production of polyester polymer

in
molten state, which will be continued on lines CP1
it is noted that the production volumes of
and CP2,
this product have already been substantially reduced as
part of the restructuring, from 105 000 tonnes a year to
60 000 tonnes a year, and will be intended exclusively
for Fidion (formerly Montefibre). A further reduction in
capacity in this product area would not be realistic and
might jeopardise the firm’s viability.

(71)

to any other

Lastly, the Commission notes that Italy has undertaken to
refrain from granting any additional State aid to SIMPE
and NGP or
firm or going concern
controlled or otherwise belonging to the same group,
following the Commission decision authorising the aid,
until 31 December 2012 in order to ensure that any
distortion created by the present aid will not be
aggravated by future aid.

(72) Accordingly, the Commission considers that the compen­
to

satory measures proposed by Italy are sufficient
mitigate the negative effects of the aid.

(73)

The Commission concludes that the notified State aid for
NGP and SIMPE in connection with the implementation
of
the above restructuring plan can be considered
compatible with the common market,

(a) SIMPE will limit the annual production of polyester polymer
the
until

for PET to 110 000 tonnes
Commission
31 December 2012;

from the date of

approving

decision

the

aid

(b) by the end of February of the following year,

Italy will
provide the Commission with information on the quantities
of polyester polymer produced and sold each year by
SIMPE, and this until 31 December 2012;

(c)

Italy undertakes to refrain from granting any type of State
aid to SIMPE and NGP or to any other firm or going
concern controlled or otherwise belonging to the same
group, following the Commission decision authorising the
aid, until 31 December 2012.

Article 3

This Decision is addressed to the Italian Republic.

Done at Brussels, 16 July 2008.

For the Commission

Neelie KROES
Member of the Commission