CELEX: 31975D0546
Language: en
Date: 1975-07-10 00:00:00
Title: 75/546/ECSC: Commission Decision of 10 July 1975 authorizing the Federal Republic of Germany to grant aids to coal mining undertakings in 1974

10 . 9 . 75                               Official Journal of the European Communities                               No L 238 / 27
                                                     COMMISSION DECISION
                                                              of 10 July 1975
                 authorizing the Federal Republic of Germany to grant aids to coal mining under­
                                                              takings in 1974
                                                  (Only the German text is authentic)
                                                               (75/ 546/ ECSC)
THE COMMISSION OF THE EUROPEAN                                                 Coal-mining premiums for
COMMUNITIES,                                                                   shift workers and piece­
                                                                               workers for every shift worked
                                                                               underground                                94-0
 Having regard to the Treaty establishing the European
                                                                               Investment aids    to  individual
 Coal and Steel Community, and in particular Articles
 2, 3 , 4 and 5 thereof ;                                                      projects under an overall invest­
                                                                               ment programme                            1601
                                                                               Payment of the instalments
 Having regard to Commission Decision No 3/71 /                                owed by RAG in respect of
 ECSC (') of 22 December 1970 on Community rules                               state-guaranteed compensation
 for interventions by Member States for the benefit of                         to the former mine-owning
the coal industry ;                                                            companies                                  50-0
                                                                          (b) New measures proposed for
 Having regard to Decision No 73/287/ ECSC (2) of 25                           1974 :
July 1973 concerning coking coal and coke for the
 iron and steel industry in the Community, and in                              Subsidies    towards   the   coal
 particular Article 9 (1 ) thereof ;                                           industry's contraction costs               990
                                                                               Subsidies towards repayment of
                                                                               the coal industry's old debts              690
 Having consulted the Council ;
                                                                               Aid for development and trials
                                                                               (testing of newly developed
Whereas the Government of the Federal Republic of                              machinery) in the coal industry            10.0
Germany has informed the Commission under Article                              Payment of instalments owed
 2 of Decision No 3/71 / ECSC of financial measures,                           by Ruhrkohle AG in respect of
both direct and indirect, which it intends to take in                          the special item to offset depre­
 1974 for the benefit of the coal industry ; whereas of                        ciation in connection with pit
 those measures the aids listed below require authoriza­                       closures                                   48-0
 tion under the abovementioned Decisions ;
                                                                               Measures to assist Preussag AG             60-0
(a) Measures already in force in previous years which
      are to be continued in 1 974 :
                                                  in DM million
      For the Aktionsgemeinschaft                                         Whereas the abovementioned aids meet the criteria
      Deutsche       Steinkohlenreviere                                    laid down in Articles 6 to 9 of Decision No 3 / 71 /
      GmbH       in    respect      of    pit                              ECSC in respect of the admissibility of such State
      closures :
                                                                           assistance ;
      — aids in respect of equaliza­
          tion of burdens payments                     21-8
      — closure premiums                              180-0
                                                                          Whereas the aids to be paid through the Aktions­
                                        Total         20 1 -8             gemeinschaft Deutsche Steinkohlenreviere are to be
                                                                          granted only on condition that they are used in
      Aid to water supply undertak­                                       connection with 'a total or partial closure of pits'
      ings in respect of expenditure                                      (Article 6 (1 ) of Decision No 3 / 71 / ECSC);
      incurred in removing under­
      ground water from closed pits                    39-0
(') O ) No L 3 , 5 . 1 . 1971 , p . 7 .                                   Whereas the amounts of such aids do not exceed the
(') O) No L 259, 15. 9 . 1973, p. 41 .                                     permissible level ;
 ---pagebreak--- No L 238 / 28                      Official Journal of the European Communities                             10 . 9 . 75
Whereas, as regards the aid in respect of equalization       incurred in respect Of an investment project may be
of burdens payments, account is taken of the fact that       covered by the aid ;
the closure of a pit leads to the destruction of the orig­
inal fixed assets to a considerable degree ; whereas the
aid , which consists in the remission of two thirds of       Whereas it is not yet possible to indicate how the aid
the property levy and the levy on profits from credits       for 1974 will be apportioned among the individual
payable to the Equalization of Burdens Fund in               projects ; whereas this will not be possible before the
                                                             end of 1 974 ;
respect of the closed pits, is in any case considerably
lower than the capital loss resulting from the closures
and is therefore within the limits laid down in Article
                                                             Whereas the purpose and amount of the proposed
6 of Decision No 3 / 71 / ECSC ;                             aids show that the measure is in accordance with the
                                                              provisions of Article 7 (2) of Decision No 3/71 / ECSC ;
                                                             whereas the Federal Government is required to notify
Whereas the closure premiums paid to coal mining             the Commission at least once a year in respect of each
undertakings by the Aktionsgemeinschaft Deutsche             project of the objective pursued, the amounts invested
Steinkohlenreviere in respect of closures are paid at a      and the amounts of aid granted ;
flat rate of DM 20 per metric ton produced ; whereas
this amount is far below that required to cover actual
closure costs ; whereas following closure the undertak­      Whereas provision has been made for 1974 for the
ings' continuing obligations in respect of damage            public authorities to pay (in lieu of RAG) an instal­
caused by mining and social charges alone may be esti­        ment of DM 50 million to the former pit owners, who
mated at between DM 30 and 35 per metric ton for              have a state-guaranteed claim to compensation from
 1 974 ;                                                     RAG ;
Whereas the aid paid at a flat rate thus does not            Whereas      RAG     suffered  losses in  1973 ; whereas
exceed the expenditure incurred as a result of pit            payment of the instalments by the public authorities
closures and is therefore in accordance with the provi­       is to be regarded as a measure aimed at preventing
sions of Article 6(2) of Decision No 3 /71 / ECSC ;           financial difficulties for RAG and avoiding temporary
                                                             supply difficulties on the coal market ;
Whereas the payment of aid amounting to DM 39
million for the removal of underground water from            Whereas payment by the Federal Government of the
closed pits likewise meets the criteria laid down in          instalments in respect of state-guaranteed compensa­
Article 6(1 ) of Decision No 3/71 / ECSC ;                   tion is therefore in accordance with the provisions of
                                                             Article 9(1)(1 ) of Decision No 3/71 / ECSC ;
Whereas the aid towards payment of the coal-mining           Whereas, as regards determining the amount of the
premium helps the coal industry to retain skilled
                                                             aid by reference to the difference between production
workers , which is absolutely essential if its produc­       costs and income , it can be seen that the aid will
tivity is to increase ; whereas, moreover, the undertak­     cover only a fraction of the RAG 's expected operating
ings incur expenditure in respect of the necessary            losses in 1974 ; whereas it is therefore in accordance
recruitment , training, adaptation and retention of staff    with the provisions of Article 9 (2) of Decision No
which is several times greater than the amount of the        3 / 71 / ECSC ;
aid towards payment of the coal-winning ;
                                                             Whereas, in order to provide guidelines for coal and
Whereas the purpose and amount of the coal-winning           energy policy, the Federal Government adopted the
premium show that the measure is in accordance with           Law of 15 May 1969 on the adaptation and recovery
Article 7(3) of Decision No 3 / 71 / ECSC ;                  of the German coal industry (Coal Law : Bundesgesetz­
                                                             hlatt 1 , p. 365) and introduced in the Bundestag a
                                                              Programme for the Federal Government's Energy
Whereas the purpose of the investment aid is to               Policy ( Energy Programme : Bundestag paper No
increase the economic viability of the German coal           7 / 1057 , ? October 197 5 );
industry ; whereas such aids are to be granted only to
undertakings which are of optimum size within the
meaning of Section 18 of the Law of 15 May 1968 on            Whereas in the light of the situation on the world
the adaptation and recovery of the German coal               energy market , which has changed fundamentally
industry and the German coal mining regions ;                since Autumn 1973 , the Energy Programme was
whereas the undertakings may use the aids only for           brought up to date in Autumn 1974 ; whereas the
investment in pits and their auxiliary installations ami      Federal    Government     has  based  some  of  the    new
in processing plant ; whereas a maximum of 30 % of           measures proposed for 1974 either on the Coal Law or
the procurement costs and /or manufacturing costs            on the Energy Programme ;
 ---pagebreak--- 10 . 9 . 75                           Official Journal of the European Communities                         No L 238 / 29
Whereas undertakings in the German coal industry                Whereas in 1969 it was assumed that the results of the
which, under their programmes for the adaptation of             undertaking in subsequent years would be so good
production to market conditions, carry out pit closures         that such depreciation by instalments could in fact be
which after 1 January 1973 lead to a lasting reduction          included in the calculation of production costs or
in coal production are to receive aids towards the costs        income as appropriate ;
arising from reduced production (contracting costs) ;
whereas over a period of 5 years aid at the rate of DM          Whereas in view of the unfavourable trends which
30 per metric ton of reduction in annual production
capacity is to be paid, provided this does not exceed            have actually developed in subsequent years RAG is
the contraction costs actually incurred by the under­            now no longer able to bear the additional burden of
                                                                these amounts of depreciation from previous years ;
taking ;
                                                                Whereas in RAG 's balance sheet as on 31 December
Whereas the purpose and amount of the proposed aid
show that the measure is in accordance with the provi­           1973 the special item for offsetting depreciation in
sions of Article 6 ( 1 ) ( 1 ) of Decision No 3/71 /ECSC ;       respect of pit closures amounted to some DM 700
                                                                 million ;
Whereas the subsidies towards payment of . the coal
industry s old debts are intended to supplement the             Whereas in order to enable RAG to cancel part of this
closure premiums ; whereas these old debts include              special item, the public authorities arc to pay aid of
costs incurred in respect of damage caused by mining,            DM 48 million annually to it over a ten-year period ;
pensions and concessionary coal as a result of pit
closures effected before 1 January 1972 ; whereas aid           Whereas special depreciation in the event of pit
is granted towards such costs, which were actually               closures constitutes closure costs ; whereas the aid is
incurred by the undertakings ;                                   designed to reduce these costs and is therefore, having
                                                                 regard to its purpose and amount, compatible with
Whereas the purpose and amount of the proposed aid               Article 6(1 ) of Decision No 3/71 / ECSC ;
show that the measure is in accordance with the provi­
sions of Article 6 (1 ) (1 ) of Decision No 3/71 / ECSC ;       Whereas, in order to avoid temporary supply diffi­
                                                                 culties and because of the regional and social impor­
Whereas it is necessary for the speedy and lasting               tance for the Ibbenbiiren area of the       Ibbenbiiren
recovery of the coal industry that the results of                mines of Preussag AG , the Federal Government has
research should pass as rapidly as possible through the          decided to grant aid to this mining company, which
development and trial stages and be put to practical             has been operating at a loss for years ; whereas the
use in the production process ; whereas aid is granted           undertaking is unable to finance the necessary invest­
for individual projects which promise to produce tang­           ment itself and is therefore to be granted a condition­
ible economic results for the coal industry in the               ally repayable subsidy to cover part of its losses ;
medium term ;
                                                                 Whereas the purpose of the aid and its amount ( DM
Whereas the aid, amounting to DM 10 million ,                    60 million ) show that the measure is in accordance
proposed for 1974 represents a subsidy towards the               with the provisions of Article 9(1 ) and (2);
costs actually incurred ;
                                                                 Whereas any examination of the compatibility of the
Whereas the purpose and amount of the aid show that              German aids with the proper functioning of the
the measure is compatible with Article 7(1 ) of Deci­            common market must include all direct and indirect
sion No 3/ 71 / ECSC ;                                           measures to be taken for the benefit of the coal
                                                                 industry in 1974 (Article 3(2) of Decision No 3/71 /
                                                                 ECSC) ;
Whereas payment on behalf of Ruhrkohle AG of
instalments in respect of the special item to offset
depreciation in connection with pit closures is a                Whereas on that basis of calculation the total cost of
special measure for the benefit of RAG ;                         the proposed direct and indirect measures amounts to
                                                                 39.5-8 million units of account, i.e. 3-99 units of
                                                                 account per metric ton produced ;
Whereas in previous years RAG has had to write off
separately its assets lost on the occasion of pit
closures ; whereas under Article 8 (2) of the Tax                Whereas this represents a 0-3 % increase in the total
Amendment Law of 1 969 RAG is entitled to include                amount of aid compared with 1973 ; whereas the
in respect of such depreciation on the assets side of            amount of aid per metric ton has risen from 3-82
the balance sheets a special item which may be                   units of account to 3-99 units of account, i.e. by
written off in instalments in subsequent years ;                 4-5 % ;
 ---pagebreak--- No L 238 /30                         Official Journal of the European Communities                           10 . 9 . 75
Whereas the following remarks must be made in                    4. Partial remission of the wages tax due from coal
respect of the compatibility of the total amount of                  mining undertakings, up to a maximum of DM
German aids with the proper functioning of the                       94 million ;
common market ;                                        «         5. Grant of investment aid not exceeding DM 160-1
— there has been no noticeable decline in trade in                   million to coal mining undertakings in order to
      coal between the Federal Republic of Germany                   encourage investment ;
      and the other Community countries in 1974,                 6. Payment of instalments owed by RAG in respect
— the quantities of German coal sold at aligned                      of the payment of state-guaranteed compensation
      prices in 1 973 were negligible ; no price align­              to the former mine-owning companies, up to a
      ment agreements were concluded in 1974,                        maximum of DM 50 million ;
— the prices of coking coal and boiler coal in                   7 . Subsidies towards the coal industry's contraction
      Germany did not lead to indirect aids for indus­               costs, up to a maximum of DM 99 million ;
      trial-users of coal in 1974,
                                                                 8. Subsidies towards payment of the coal industry's
— the closure of unprofitable pits leads to rationaliza­             old debts, up to a maximum of DM 69 million ;
      tion and the concentration of production in pits
      where productivity is highest ;                            9 . Aid for development and trials, up to a maximum
                                                                     of DM 10 million ;
Whereas it can therefore be said that the German aids
                                                                10 . Payment on behalf of Ruhrkohle AG, of instal­
to the coal industry are compatible with the proper
                                                                     ments in respect of th<; special item to offset
functioning of the common market ;                                   depreciation in connection with pit closures, up
Whereas this applies even if account is taken of the                 to a maximum of DM 48 million ;
aids granted to the coal industry under Decision No             11 . Measures for the benefit of the Ibbenbiiren mines
73/287/ ECSC ;                                                       of Preussag AG , up to a maximum of DM 60
                                                                     million .
Whereas under Article 11(1 ) of Decision No 3/71 /
ECSC the Commission must ensure that the aids auth­
orized are used for the purpose set out in Articles 6 to                               Article 2
9 of that Decision ; whereas to this end it must be
informed in particular of the amount and apportion­
ment of such aids,
                                                                The Federal Government shall supply the Commis­
                                                                sion with particulars by 15 November 1975 regarding
                                                                the aids granted pursuant to this Decision , in parti­
HAS ADOPTED THIS DECISION :                                     cular the amounts paid and the manner in which they
                                                                were apportioned .
                           Article 1
The Government of the Federal Republic of Germany                                      A rticle 3
 is hereby authorized to grant to the German coal
industry in the calendar year 1974 the following aids :         This Decision is addressed to the Federal Republic of
                                                                Germany.
   1 . Remission of two thirds of the property levy and
       the levy on profits from credits on pits due to be
       closed ;
   2. Payment through the Aktionsgemeinschaft                   Done at Brussels, 10 July 1975.
       Deutsche Steinkohlenreviere of closure premiums
       amounting to DM 20 per metric ton of disconti­
       nued production ;                                                                  For the Commission
   3 . Reimbursement of the costs of pumping out                                              The President
       underground water from closed pits, up to a
       maximum of DM 39 million ;                                                        Francois-Xavier ORTOLI