ON MEDIUM-TERM LOANS OF UP TO LFRS 6 800 MILLION ,
- CONTRIBUTION OF INCREASES OF CAPITAL OF LFRS 2 700 MILLION ,
- INTEREST SUBSIDIES OF LFRS 3 330 MILLION .
TO JUSTIFY THE AIDS , THE LUXEMBOURG GOVERNMENT PROPOSES A FURTHER NET REDUCTION OF 60 000 TONNES OF CAPACITY FOR HOT-ROLLED PRODUCTS .
IV
THE SECOND INDENT OF ARTICLE 2 ( 1 ) OF DECISION NO 2320/81/ECSC PROVIDES THAT THE RESTRUCTURING PROGRAMMES OF AIDED UNDERTAKINGS SHOULD NOT MAKE PROVISION FOR AN INCREASE IN PRODUCTION CAPACITY FOR CATEGORIES OF PRODUCTS FOR WHICH THERE IS NOT A GROWTH MARKET . THE LUXEMBOURG PLAN PROVIDES FOR THE REMOVAL OF A BOTTLENECK IN THE ESCH-SCHIFFLANGE ROD MILL , WHICH WOULD LEAD TO AN INCREASE IN THE CAPACITY OF THIS MILL IN 1983 OF 78 000 TONNES OVER THE 1980 LEVEL . THE WIRE-ROD MARKET DOES NOT APPEAR TO BE ONE THAT HAS GROWTH POTENTIAL .
THE PROVISIONS OF ARTICLE 2 ( 3 ) OF THE DECISION ARE NOT APPLICABLE TO LUXEMBOURG SINCE ITS INDUSTRY HAS MUCH MORE THAN A MINIMAL EFFECT ON THE COMMUNITY MARKET .
THE SECOND INDENT OF ARTICLE 3 ( 1 ) AND THE THIRD INDENT OF ARTICLE 5 ( 1 ) OF DECISION NO 2320/81/ECSC PROVIDE THAT THE AMOUNT AND INTENSITY OF INVESTMENT AID AND AID FOR CONTINUED OPERATION MUST BE JUSTIFIED BY THE EXTENT OF THE RESTRUCTURING ASSOCIATED WITH THEM . IN LINE WITH THE GENERAL OBJECTIVES FOR STEEL AN OVERALL REDUCTION COMMUNITY-WIDE OF 30 TO 35 MILLION TONNES OF CAPACITY FOR HOT-ROLLED PRODUCTS IS NECESSARY TO RESTORE A LEVEL OF CAPACITY UTILIZATION WHICH IS CONSIDERED THE MINIMUM REQUIRED TO SECURE THE VIABILITY OF THE COMMUNITY STEEL INDUSTRY UNDER NORMAL MARKET CONDITIONS . IT IS NECESSARY TO ENSURE THAT THIS OVERALL CAPACITY REDUCTION IS DISTRIBUTED FAIRLY . ON THIS BASIS , AFTER TAKING INTO CONSIDERATION THE RESTRUCTURING EFFORT TO DATE AND THE AID GRANTED PRIOR TO 1980 , AN EXTRA RESTRUCTURING EFFORT MUST BE ACCEPTED BY THE LUXEMBOURG STEEL INDUSTRY . ACCORDINGLY , THE LUXEMBOURG STEEL INDUSTRY MUST REDUCE ITS CAPACITY FOR HOT-ROLLED PRODUCTS BY 410 000 TONNES IN ADDITION TO THE REDUCTION OF 60 000 TONNES PROPOSED . IT IS NECESSARY TO SET A DEADLINE BY WHICH THE ADDITIONAL CLOSURES REQUIRED MUST BE IDENTIFIED .
V
THE COMMISSION MUST SUPERVISE THE GRANT OF AIDS AUTHORIZED AND COMPLIANCE WITH THE CONDITIONS IMPOSED BY IT .
THE CAPACITY REDUCTIONS MUST BE OBTAINED BY THE COMPLETE CLOSURE OF PLANT PRODUCING HOT-ROLLED PRODUCTS AND THE COMMISSION MUST BE ABLE TO VERIFY THAT SUCH CLOSURE IS DEFINITIVE . THE NET CAPACITY REDUCTIONS TAKE INTO ACCOUNT ANY CAPACITY INCREASES THAT MAY RESULT FROM APPROVED INVESTMENT PROGRAMMES . TO ACHIEVE THE OBJECTIVE OF BRINGING CAPACITY INTO LINE WITH DEMAND , THE CREATION OF NEW CAPACITY MUST BE COMPENSATED BY ADDITIONAL CLOSURES .
THE FIRST INDENT OF ARTICLE 2 ( 1 ) OF DECISION NO 2320/81/ECSC PROVIDES THAT AIDED UNDERTAKING MUST BE ENGAGED IN THE IMPLEMENTATION OF A RESTRUCTURING PROGRAMME WHICH IS CAPABLE OF