ANNOUNCEMENT 07 Sep 2012

On 7 September 2012, the European Commission approved an increase in the budget by Finland for a measure to finance broadband construction. Further, additional aid instruments have been provided to incentivize the operator.

NUMBER OF INTERVENTIONS

4

  • 4 harmful
  • 0 neutral
  • 0 liberalising

SOURCE

SA.34290. High-speed Broadband Construction Aid in Sparsely Populated Areas of Finland :
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_SA_34290

Original publication:
http://eur-lex.europa.eu/JOHtml.do?uri=OJ:C:2013:043:SOM:EN:HTML

European Commission decision. SA.34290
http://ec.europa.eu/competition/state_aid/cases/243482/243482_1396581_81_2.pdf

Inception date: 07 Sep 2012 | Removal date: 31 Dec 2015

Financial grant

On 7 September 2012, the European Commission approved a EUR 28 (USD 35) million increase in financial grants by Finland to develop broadband infrastructure. The grant was initially approved on 6 May 2010 with a budget of EUR 132 (USD 168) million. The beneficiaries of the grant are "electronic communications operators offering broadband services." The funding will be provided between the period 2010 to 2015.

Apart from the budget increase, Finland has also increased the maximum aid intensity per project from 66% to 90% and allowed additional funding instruments such as loan agreements, loan guarantees, and equity-based funding (see related interventions).

The objective of the measure is to "develop an infrastructure of electronic communication network offering high-speed broadband services in sparsely populated areas in Finland which are currently not served and where there are no plans for such coverage in the near future."

In the decision in May 2010, the European Commission noted that: "the fact that an improved broadband service becomes available has the effect of distorting competition."

Regardless, the Commission has decided not to raise objections to the aid on the grounds noting that the measure is compatible with Article 107(3)(c) TFEU.

The state aid is notified under the following objective: Sectoral development.

A state act in the GTA database is assessed solely in terms of the extent to which its implementation affects foreign commercial interests. On this metric, the financial support granted here is discriminatory.

AFFECTED SECTORS

 

AFFECTED PRODUCTS

 
N/A
Inception date: 07 Sep 2012 | Removal date: 31 Dec 2015

State loan

On 7 September 2012, the European Commission approved an amendment by Finland to provide state loans for the development of broadband infrastructure. The amendment has been made to an existing EUR 132 million (USD 168 million) financial grant measure announced in May 2010 (see related State Act). The aid will be provided between the period 2010 to 2015.

The amendment states that the Finnish authorities will use additional aid instruments such as "subordinated loans, convertible loans, loan facility agreements, equity-based funding, loan at a low interest rate, loan guarantee up to 100% of the loan amount, direct grants other than those included in the original measure" in order to "stimulate the operators’ interests to build subsidized networks in the remote area."

Apart from this amendment, Finland has also increased the maximum aid intensity per project from 66% to 90% and increased the budget from EUR 132 million to EUR 160 million (USD 203 million) (see related interventions).

The objective of the measure is to "develop an infrastructure of electronic communication network offering high-speed broadband services in sparsely populated areas in Finland which are currently not served and where there are no plans for such coverage in the near future."

In the decision from May 2010, the European Commission noted that: "the fact that an improved broadband service becomes available has the effect of distorting competition."

Regardless, the Commission has decided not to raise objections to the aid on the grounds noting that the measure is compatible with Article 107(3)(c) TFEU.

The state aid is notified under the following objective: Sectoral development.

A state act in the GTA database is assessed solely in terms of the extent to which its implementation affects foreign commercial interests. On this metric, the financial support granted here is discriminatory.

 
N/A
Inception date: 07 Sep 2012 | Removal date: 31 Dec 2015

Capital injection and equity stakes (including bailouts)

On 7 September 2012, the European Commission approved an amendment by Finland to provide equity-based funding for the development of broadband infrastructure. The amendment has been made to an existing EUR 132 million (USD 168 million) financial grant measure announced in May 2010 (see related State Act). The aid will be provided between the period 2010 to 2015.

The amendment states that the Finnish authorities will use additional aid instruments such as "subordinated loans, convertible loans, loan facility agreements, equity-based funding, loan at a low interest rate, loan guarantee up to 100% of the loan amount, direct grants other than those included in the original measure" in order to "stimulate the operators’ interests to build subsidized networks in the remote area."

Apart from this amendment, Finland has also increased the maximum aid intensity per project from 66% to 90% and increased the budget from EUR 132 million to EUR 160 million (USD 203 million) (see related interventions).

The objective of the measure is to "develop an infrastructure of electronic communication network offering high-speed broadband services in sparsely populated areas in Finland which are currently not served and where there are no plans for such coverage in the near future."

In the decision from May 2010, the European Commission noted that: "the fact that an improved broadband service becomes available has the effect of distorting competition."

Regardless, the Commission has decided not to raise objections to the aid on the grounds noting that the measure is compatible with Article 107(3)(c) TFEU.

The state aid is notified under the following objective: Sectoral development.

A state act in the GTA database is assessed solely in terms of the extent to which its implementation affects foreign commercial interests. On this metric, the financial support granted here is discriminatory.

 
N/A
Inception date: 07 Sep 2012 | Removal date: 31 Dec 2015

Loan guarantee

On 7 September 2012, the European Commission approved an amendment by Finland to provide loan guarantees for the development of broadband infrastructure. The amendment has been made to an existing EUR 132 million (USD 168 million) financial grant measure announced in May 2010 (see related State Act). The aid will be provided between the period 2010 to 2015.

The amendment states that the Finnish authorities will use additional aid instruments such as "subordinated loans, convertible loans, loan facility agreements, equity-based funding, loan at a low interest rate, loan guarantee up to 100% of the loan amount, direct grants other than those included in the original measure" in order to "stimulate the operators’ interests to build subsidized networks in the remote area."

Apart from this amendment, Finland has also increased the maximum aid intensity per project from 66% to 90% and increased the budget from EUR 132 million to EUR 160 million (USD 203 million) (see related interventions).

The objective of the measure is to "develop an infrastructure of electronic communication network offering high-speed broadband services in sparsely populated areas in Finland which are currently not served and where there are no plans for such coverage in the near future."

In the decision from May 2010, the European Commission noted that: "the fact that an improved broadband service becomes available has the effect of distorting competition."

Regardless, the Commission has decided not to raise objections to the aid on the grounds noting that the measure is compatible with Article 107(3)(c) TFEU.

The state aid is notified under the following objective: Sectoral development.

A state act in the GTA database is assessed solely in terms of the extent to which its implementation affects foreign commercial interests. On this metric, the financial support granted here is discriminatory.

 
N/A