ANNOUNCEMENT 03 Mar 2011

In March 2011, the government of France announced a change in private-sector financial support.

NUMBER OF INTERVENTIONS

1

  • 1 harmful
  • 0 neutral
  • 0 liberalising
Inception date: 09 May 2011 | Removal date: open ended
Still in force

Financial grant

On 3 march 2011, France notified the EC about its restructuring scheme for the industrial sweet water fishery and pisciculture.
 
The scheme involves two different instruments. On the one hand, direct grants for the relevant firms in difficulty to give them the chance for restructuring. On the other hand, a scheme that is targeted to firms in the process of winding up or conversion in order to clear the market.
 
The amount of state aid is limited to EUR 4.039.000 and will be distributed over 6 years (para. 2 , Letter from the EC to France, Brussels 07.03.2012 c(2012) 1362 fin). The eligibility of the firms will be measured by a 'pre-diagnostic' system that tracks the difficulties in their operations and their current solvency level. The criteria for 'firms in difficulty' are: minimum 75% debt with respect to the equity of the firm and a maximum profitability of 20% over the last 3 years.
 
The scheme foresees a "non-growth condition" meaning that the quantity of fish extracted is not allowed to increase and the strategy is to aim for financial stabilisation of the commercial entities involved instead of a quantitative expansion.
 
The EC argues that a grant or a subsidized loan for a specific sector/enterprise constitutes state aid and is therefore incompatible with the internal market 107(1), if it cannot be justified as an exception with respect to article 107(3).
 
«D'aprčsunejurisprudenceconstante,leséchangescommerciauxsontconsidérés comme affectés lorsque l'entreprise bénéficiaire exerce une activité économique et se trouve en concurrence avec des produits de provenance d'autres Etats membres. Le simplefaitquelacompétitivitéd'uneentreprisesoitrenforcéeparrapportŕdes entreprises concurrentes en obtenant un avantage économique qu'elle n'aurait pas reçu autrement dans l'exercice normal de son activité, indique qu'il y a risque de distorsion de concurrence.
En l'espčce, les poissons et autres organismes aquatiques élevés dans ou pęchés par les entreprises bénéficiaires sont mis en vente sur le territoire de l'Union européenne oů ils sont en concurrence avec d'autres produits similaires provenant d'entreprises de France et d'autres Etats membres. Les entreprises concernées par l'aide sont les acteurs d'un marché européen compétitif sur lequel de nombreux échanges entre Etats membres ont lieu.» (par 50-51, Letter from the EC to France, Brussels 07.03.2012 c(2012) 1362 fin)
 
Hence, the EC confirms the existence of a European market for these fishery products and that the state aid will distort competition on the local level as well as trade between member states.
 
The EC finally concludes that the measure is in line with article 107(1) TFEU, because it can be considered an exception with respect to section 3 of the LDSR (les aides d'Etat au
sauvetage et ŕ la restructuration des entreprises en difficulté) meeting the objectives of the PCP (Réforme de la Pęche Européenne).
 
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.