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There are currently no known outstanding effects for the Commission Decision of 30 March 2004 on the State aid scheme put into effect by Italy providing for urgent measures to assist employment (notified under document number C(2004) 930) (Only the Italian version is authentic) (Text with EEA relevance) (2004/800/EC).
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THE COMMISSION OF THE EUROPEAN COMMUNITIES,
Having regard to the Treaty establishing the European Community, and in particular the first subparagraph of Article 88(2) thereof,
Having regard to the Agreement on the European Economic Area, and in particular Article 62(1)(a) thereof,
Having called on interested parties to submit their comments pursuant to the provisions cited above(1),
Whereas:
1. PROCEDURE
2. DESCRIPTION OF THE AID
a monthly grant equal to 50 % of the special indemnity to which the worker would be entitled if laid off under the laid-off workers’ mobility scheme (collocamento in mobilità),
a reduction in employer’s social security contributions for the first 18 months, the rate of contribution charged being that for trainees.
These are the benefits granted under another Act, Act No 223/1991, to employers who take on workers registered under the laid-off workers’ mobility scheme, i.e. workers whose employment has ended by reason of a structural crisis and who satisfy stated requirements.
Under the aid scheme notified, the same benefits are granted, up to a ceiling of 550 employees, to purchasers who agree to employ staff of the existing firm; these would not qualify for the laid off workers’ mobility scheme.
The benefits are granted in respect of a maximum of 550 employees transferred provided two conditions are met: (i) the transfer of employees must be provided for in a collective agreement concluded with the Ministry of Labour by 30 April 2003, and (ii) the purchaser and the firm purchased cannot have the same ownership, and there must be no relationship of control or association between them.
3. GROUNDS FOR INITIATING THE PROCEDURE
4. COMMENTS SUBMITTED BY ITALY
that the measure under examination was not one that applied in specific areas or to specific recipients,
that if the Commission did not consider it a general measure, it should conclude that it did not affect competition, as it was aimed at restoring the productive activity of firms in difficulty and safeguarding the jobs involved,
that the scheme complied with the rescue and restructuring guidelines, as it did not increase production capacity but aimed to restore viability and safeguard jobs.
5. ASSESSMENT OF THE AID
The scheme under examination provides for grants and social security reductions to purchasers of firms in financial difficulty that are in special administration and have at least 1 000 employees. It therefore confers an economic advantage on the purchaser, who receives a non-repayable grant for every employee transferred, and is relieved of part of the social security contributions ordinarily payable by the employer for 18 months.
The Commission takes the view that the measure may comprise an economic advantage to the firm in special administration as well. Who is the effective recipient of the aid will depend on a number of factors which have not been clarified by the Italian authorities: whether the firm in financial difficulty is a going concern, whether the sale is an asset or a share deal, whether the purchaser is clearly separate from the firm in financial difficulty, how the selling price is determined, etc.
The Commission considers that the scheme confers an economic advantage on a specific category of recipients, namely:
the purchaser of a firm, where the firm is in financial difficulty, is in special administration, and has at least 1 000 employees, and the purchaser concluded a collective agreement approving the transfer of employees with the Ministry of Labour by 30 April 2003, and/or
the firm sold, where the firm is in financial difficulty, is in special administration, and has at least 1 000 employees.
The Commission therefore takes the view that the measure is not a general measure, but instead confers an economic advantage on certain undertakings, reducing the costs they would otherwise have to bear and strengthening their financial position as compared with competitors who do not benefit under the same measures. This finding is confirmed by the fact that the measure has been applied in only one case.
rescue and restructuring aid notified individually to the Commission, for all firms irrespective of size,
rescue and restructuring aid schemes confined to small and medium-sized enterprises.
The Italian authorities notified an aid scheme that applies to all firms irrespective of size. Indeed, as the scheme concerns the sale of firms having more than 1 000 employees, the firms concerned will for the most part be large(7). In its current form, therefore, the scheme cannot be considered compatible with the common market on the basis of the rescue and restructuring guidelines.
the notified measure should be considered as a ‘general measure to promote employment which does not distort or threaten to distort competition by favouring certain undertakings or the production of certain goods’ (recital 6 to the abovementioned Regulation), as it is general and abstract, and applies to all firms with more than 1 000 employees which are in special administration and which are sold,
the benefits granted are the same as those available under the laid-off workers’ mobility scheme, which has never been considered State aid,
if the measure is considered to constitute State aid, it should be regarded as a scheme for the creation of employment: Article 4(4)(c) of the Employment Aid Regulation explicitly provides that ‘the new workers employed as a result of the creation of employment must have never had a job or have lost or be losing their previous job’. The measure under examination concerns the last of these cases.
6. CONCLUSION
HAS ADOPTED THIS DECISION:
The State aid measure providing for urgent measures to assist employment which Italy has put into effect under Decree-law No 23 of 14 February 2003, converted into statute by Act No 81 of 17 April 2003, is incompatible with the common market.
Italy shall withdraw the scheme referred to in Article 1 in so far as it continues to have effect.
1.Italy shall take all necessary measures to recover from the recipients the aid granted under the scheme referred to in Article 1 which has been unlawfully made available to the recipients.
2.Italy shall cancel all outstanding payments of aid with effect from the date of this Decision.
3.Recovery shall be effectuated without delay in accordance with the procedures of national law provided that they allow the immediate and effective execution of the Decision.
4.The aid to be recovered shall include interest from the date on which it was made available to the recipient until the date of its recovery.
5.Interest shall be calculated on the basis of the reference rate used for calculating the grant equivalent of regional aid on the date on which the aid was made available to the recipient.
6.The interest rate referred to in paragraph 5 shall apply on a compound basis over the entire period referred to in paragraph 4.
Italy shall inform the Commission, within two months of notification of this Decision, of the measures taken to comply with it, using the questionnaire attached to the Decision.
This Decision is addressed to the Italian Republic.
Done at Brussels, 30 March 2004.
For the Commission
Mario Monti
Member of the Commission
principal,
interest.
On the table overleaf, please provide details of each of the recipients from whom aid granted unlawfully under the scheme is to be recovered.
See footnote 1.
Judgment of the Court of Justice in Case 102/87 France v Commission [1988] ECR 4067.
As far as the sale of Ocean SpA to Brandt Italia is concerned, the Italian authorities did not supply any information regarding the size of the acquiring company, Brandt Italia. The company acquired, Ocean SpA, had more than 1 000 employees.
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