ANNOUNCEMENT 02 Dec 2008In December 2008, the government of Spain announced a change in private-sector financial support.
NUMBER OF INTERVENTIONS
the letter from the EC to Spain - Brussels, 04.05.2009 C(2009) 3459. Available from < http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_N608_2008 >
the letter from the EC to Spain - Brussels, 09.12.2010 C(2010)9020 final. Available from : < http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_N502_2010 >
On 2 December 2008 the Spanish authorities notified an aid scheme destined to the rescue and restructuring of SMEs in the region of Andalucía, Spain.
The objective of the aid scheme is the rescue and restructuring of micro, small and medium sized enterprises (SMEs) in difficulty in the region of Andalusia, Spain.
The financial crisis worldwide has caused a credit crunch affecting the regional productive businesses leading to a reduction of the productive activity and of the employment. Therefore, the present aid scheme has as objective to promote the rescue and return to viability of Andalusian businesses in difficulties due to the cyclical slowdown. Aid under the scheme can only be granted to SMEs in difficulty.
The objective of the rescue aid is to maintain the company afloat during the 6 months necessary to elaborate the restructuring plan. The aid will be limited due to the application of the formula in the annex of the Guidelines in most cases (otherwise a justification will be necessary) and the limited budget (180 million EUR for 100-500 beneficiaries).
Rescue aid can be granted in the form of loans and guarantees. The loan or guarantee will be at the company's disposal during the rescue period, which is restricted to 6 months.
The Commission founds that the notified measure constitutes state aid within the meaning of Article 87 (1) of the EC Treaty and gave the following assessment:
" The Commission considers that the present measures granted by the Junta Andalucía/IDEA are provided by State resources. The terms of the aid (loan, guarantee, grant, interest subsidy) are more favourable than the terms obtainable in the open market. This provides an economic advantage to definite SMEs in difficulties in the region of Andalusia. The aid granted in this manner may strengthen the position of these companies compared to that of their competitors in other Member States. Therefore, they must be regarded as distorting competition and affecting trade between Member States. The measures thus constitute State aid within the meaning of Article 87 (1) EC Treaty." (par. 37 of the letter from the EC to Spain - Brussels, 04.05.2009 C(2009) 3459)
Article 87(3)(b) of the EC Treaty enables the Commission to declare aid compatible with the Common Market if it is "to remedy a serious disturbance in the economy of a Member State." This aid has to be applied restrictively and must tackle a disturbance in the entire economy of the Member State according to the interpretation of the Article 87(3)(b) by the Court of First Instance.
The Commission referred to its Communication on the financial crisis (Temporary Framework) and concluded that the Measure complies with the conditions laid therein. Therefore, despite the measure constituting State aid pursuant to the Article 87(1) EC, it is compatible with the Common Market according to the Article 87(3)(b) EC Treaty. The Commission raises no objections against the measure at issue and authorizes it as emergency intervention in the face of the current financial crisis. (par. 38 - 42 of the letter).
Amendments to State aid scheme N 608/2008 - Rescue and restructuring aid for SMEs in difficulties in Andalucía, Spain - State aid N 502/2010
The Kingdom of Spain notified on 3 November 2010 an extension of the existing aid scheme N 608/2008 (see above).
The present notification concerns the extension of the validity of the Scheme. The Spanish authorities intend to prolong the validity of the Scheme from 1 January 2011 until 9 October 2012, and to provide an additional budget of EUR 60 million for 2011 and EUR 60 million for 2012. All the terms and conditions for granting aid under the Scheme, as approved by the Commission in its above-mentioned decision in case N 608/2008, remain unchanged. Spain estimates that, throughout the prolongation period (2011-2012), the Scheme could benefit between 75 and 150 SMEs. (par. 5 of the letter from the EC to Spain - Brussels, 09.12.2010 C(2010)9020 final)
The Spanish authorities have decided to prolong the Scheme because of the persistence of the financial crisis. Access to credit is restricted and demand has fallen. This has led to great difficulties for business in general, and for SMEs in particular. In Andalucía, which is an assisted region under Article 107(3)(a) TFEU, SMEs are one of the main sources of employment. (par. 6 of the letter)
The Commission decided not to raise objections to the prolongation of scheme.
A state measure in the GTA database is assessed solely in terms of the extent to which its implementation affects the extent of discrimination against foreign commercial interests. On this metric, the state aid proposed here is discriminatory.