ANNOUNCEMENT 01 Jan 2009In January 2009, the government of Germany announced a change in private-sector financial support.
NUMBER OF INTERVENTIONS
the official letter from the European Commission to Germany - Brussels,17.02.2009 K(2009)1155. Available from < http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_N451_2008 >
On8 September 2008 the German authorities notified the Commission, according to Article 88 (3) of the EC Treaty, of the above mentioned aid measure.
The purpose of the aid scheme is to improve R&D&I (Community Framework for State aid for research and development and innovation) in Rheinland-Pfalz through the build-up of young innovative enterprises. The aid is awarded in the form of direct grants, reimbursable grants, silent participations, soft loans and/or through risk capital. The total projected support will amount to EUR 70 million, or about EUR 10 million annually, funded by the budget of Rheinland-Pfalz and cofinanced by the European Regional Development Fund ERDF.
The measure is aiming at young innovative enterprises that have a site or branch in the Land Rheinland-Pfalz. Germany expected 51-100 beneficiaries throughout the duration of the measure (firms in difficulty as well as companies active in shipbuilding, fishery, coal- and steel-industry are excluded).
The Commission concluded that the notified measure constitutes State aid within the meaning of Article 87 (1) of the EC Treaty and gave the following assessment:
" The notified measure allows a limited number of young and innovative enterprises that have a site or branch in the Land Rheinland-Pfalz to receive financial means, by means of State resources. There is no element suggesting that the capital market would provide to those enterprises the same resources at the same conditions as those provided by the public authorities. Consequently, the scheme grants a selective advantage to those enterprises. Products and services of benefiting enterprises are or might be subject to intra-Community trade. The aid strengthens the competitive position of the enterprises in relation to their competitors in the Community and therefore has potentially distorting effects on competition and trade between Member States. " (par. 20 of the letter from the European Commission to Germany - Brussels,17.02.2009 K(2009)1155).
" The Commission finds that the confirmation by Germany concerning the cumulation rules, as stated under point 2.8 above, meets the conditions laid down in the R&D&I Framework; therefore, the conditions related to cumulation are satisfied and the measure complies with point 5.4 and section 8 of the R&D&I Framework." (par.26 of the letter). Therefore, the Commission stated that the aid measure is compatible with the EC Treaty in application of its Article 87 (3) (c).
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.