ANNOUNCEMENT 18 May 2009In May 2009, the government of Latvia announced a change to private-sector financial support.
NUMBER OF INTERVENTIONS
Initial interest rate subsidy scheme from 2009
Prolongation from 2013
On 18 May 2009, Latvia notified the European Commission about its intention to support agricultural producers through a partial interest rate subsidy scheme.
The scheme is designed to cover part of the annual interest paid on the loans of firms active in the 'primary production of agricultural products' (para. 9, letter from the EC to Latvia, Brussels 21.8.2009).
The aid will not exceed 10 per cent of the annual credit payments and amounts for a total of EUR 85.4 million. The scheme enters into force on 1 January 2010 and will expire on 31 December 2013.
The EC finds that: The measure confers advantage on recipients. The partial subsidy of credit interest constitutes an investment aid providing economic benefit to an undertaking which it would not have received in its normal course of business and creating wider opportunities for the beneficiaries to obtain credit. There is an important cross-border trade in agricultural products. The advantage is granted through State resources and it favours certain agricultural undertakings active in the Republic of Latvia. It is therefore liable to distort competition and to affect trade between Member States
Prolongation of the Scheme: SA.37694
On 11 November 2013, Latvia informed the EC about its intention to prolong the scheme until 31 December 2019.
Latvia confirmed that: 'with the exception of prolonging the duration of the N301/2009 aid scheme, all other elements of the original approval decision of the European Commission remain unchanged' (para. 8, letter from the EC to Latvia, Brussels, 4.12.2013)
The potential trade distortions mentioned above therefore remain unchanged until 2019.
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.