Competition weekly news summary
Friday, November 20, 2009

Conferences and Speeches

  • Commission outlines conditions for state aid to KBC, ING and Lloyds
    Opening remarks at press conference, Brussels, Neelie Kroes
    18 November 2009
    "If it is not already clear, I want to spell out today that, in banking as in all markets, excessively risky behaviour has consequences. There is no such thing as a free lunch and today's restructuring announcements reflect that. Our policy is to encourage vibrant but responsible competition in the banking sector."
  • Why we need competitive markets
    Conference on "Competition, Public Policy and Common Man" Delhi, Neelie Kroes
    16 November 2009
    "A competition regime's long-term survival depends on the common man – and common woman! – understanding why we need competitive markets. Communicating the benefits of competition and the need for enforcement policy to make sure it can flourish are vital."

Antitrust

  • Commission confirms sending of Statement of Objections to Standard & Poor's
    19 November 2009
    The Commission can confirm that on 16 November 2009 it sent a Statement of Objections to Standard & Poor's (S&P), a division of McGraw-Hill Companies, Inc. of the United States. The Commission takes the preliminary view that S&P is abusing its dominant position as sole-appointed National Numbering Agency for US securities, by requiring clients to pay licensing fees for the use of International Securities Identification Numbers (ISINs) in their own databases.

Mergers

  • Commission approves proposed acquisition of Nortel's Enterprise Solutions business by Avaya
    19 November 2009
    The Commission found that the planned transaction would not raise any competition concerns because the markets for PBXs and contact centres are very dynamic and are moving to internet protocol (IP)-based technologies. Post-merger, the combined entity would continue to face a number of strong and effective competitors giving customers the choice from a range of alternative providers for PBXs and contact centres.

State aid

  • Commission requests Spain to comply with Court judgment on recovery of incompatible aid under company tax schemes
    20 November 2009
    The Commission requested Spain to implement an ECJ judgment (case C-177/06) finding that Spain had failed to recover incompatible state aid granted by certain Basque Provinces, as it was ordered by Commission decisions of December 2001. The Commission concluded that Spain has still not completed the recovery of the aid granted by the Provinces of Guipúzcoa and Álava. If Spain continues to fail to comply with the ECJ decision, the Commission may refer it to the Court for a second time and request the ECJ to impose fines until the aid has been fully recovered.
  • Commission approves revised Irish guarantee scheme for financial institutions
    20 November 2009
    The Commission authorised an Irish measure aimed at stabilising financial markets by providing guarantees on deposits and debt to eligible banks active on the Irish market. The Commission found the revised scheme to be in line with EU state aid rules because it is limited in time and scope.
  • Commission opens in-depth investigation into €49.6 million state guarantee in favour of Romanian chemical producer Oltchim
    19 November 2009
    The Commission opened a formal investigation into a guarantee worth €49.6 million granted by Romania in favour of Oltchim, one of Romania's largest chemical companies. The Commission has doubts whether the state guarantee is in line with EU state aid rules. In particular, the Commission needs to verify whether Oltchim was already in difficulties before the current financial and economic crisis.
  • Commission authorises aid for revitalisation of degraded areas in Poland for the period 2007-2013
    19 November 2009
    The Commission authorised around €500 million of public funding that the Polish authorities intend to grant for the revitalisation of economically deprived areas of Poland in the period 2007-2013. The Commission has concluded that the planned measures will not affect trading conditions to an extent contrary to the common interest and that the impact on trade between Member States will be very limited.
  • Commission prohibits electricity price subsidies for Alcoa and orders partial recovery of aid already granted
    19 November 2009
    The Commission found that operating aid granted since 2006 by Italy to aluminium producer Alcoa was incompatible with EU state aid rules. The preferential electricity tariffs that Italy offered Alcoa for its aluminium smelters in Sardinia and Veneto from 2006 to 2010 only contribute to reducing Alcoa's operating costs and have no other justification. They give the company an unfair advantage over its competitors, which have to operate without such subsidies. The Commission has therefore ordered Italy to end the illegal subsidies and to recover part of the aid already paid from Alcoa.
  • Commission opens in-depth investigation into Portuguese regional investment aid for Petrogal
    19 November 2009
    The Commission opened a formal investigation into aid worth some €160 million for an investment project of the Portuguese energy company Petrogal in its existing refineries in Sines and Matosinhos. After a preliminary investigation, the Commission has doubts as to the compatibility of the aid measure with EU state aid rules, in particular regarding the incentive effect of the aid and the high market share of the beneficiary on the Portuguese market. Moreover, issues regarding the geographic and product market definition need to be clarified.
  • Commission approves €103 million capital injections for 'Mortgage and Land Bank of Latvia'
    19 November 2009
    The Commission authorised capital injections of LV 72.79 million (€102.48 million) in favour of 'The Mortgage and Land Bank of Latvia' (LHZB). The Commission concluded that the part of the capital injections that benefit LHZB's development bank activities do not constitute state aid, because within the scope of those activities LHZB only operates state-supported lending programmes in accordance with EU state aid rules. Insofar as the measures also benefit the commercial activities of LHZB, the Commission found them in line with the EU's state aid rules because they will be phased out by 31 December 2013.
  • Commission approves restructuring plan of Lloyds Banking Group
    18 November 2009
    The Commission has authorised the restructuring plan of Lloyds Banking Group. The plan was notified on 16 July 2009 and contained a number of support measures to be granted to Lloyd's in addtion to the financial support package already approved by the Commission on 13 October 2008 (see IP/08/1496). Having assessed the past and new aid on the basis of the notified plan, and in view of amendments agreed by the UK authorities, the Commission is satisfied that it is in line with EU state aid rules. In particular, the measures foresee that Lloyds will pay a significant proportion of the restructuring costs, ensure a sustainable future for Lloyds without continued state support and limit distortions of competition.
  • Commission approves ING restructuring plan and illiquid asset back-up facility
    18 November 2009
    The Commission authorised the restructuring plan of Dutch-based financial institution ING. On the basis of the notified restructuring plan, ING will pay a significant proportion of the restructuring costs, ING's long term commercial viability will be restored, and the aid will not lead to undue distortions of competition. The restructuring plan foresees that ING will reduce the risk profile and complexity of its operations and will sell its insurance activities over time. ING will also carve out a business unit, to step up competition in the Dutch retail banking market.(
  • Commission approves asset relief and restructuring package for KBC
    18 November 2009
    The Commission authorised an asset relief and restructuring package for the Belgian KBC Group. The Commission is satisfied that the package ensures that KBC will pay a significant proportion of the restructuring costs, will restore the long-term commercial viability of KBC, and tackles the distortions of competition that result from the state aid. Furthermore, following an in-depth investigation, the Commission has concluded that the asset relief measure launched on 30 June 2009 (see IP/09/1063), is in line with EU state aid rules and no doubts remain concerning the valuation and remuneration of the measure.
  • Commission decisions on KBC, ING and Lloyds – frequently asked questions
    18 November 2009
  • Commission approves amendment to Lithuanian crisis measure allowing small amounts of aid
    16 November 2009
    The Commission authorised an amendment to a Lithuanian scheme allowing to grant aid of up to €500 000 per company, initially approved on 8 June 2009 (see IP/09/890). The Commission is satisfied that the amendment is in line with EU state aid rules, because it is limited in time and only applies to companies that were not in difficulties on 1 July 2008.

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Published by the Competition Directorate General of the European Commission. The content of this publication does not necessarily reflect the official position of the European Commission. Neither the Commission nor any person acting on its behalf is responsible for the use which might be made of the above information.

© European Union, 2009. Reproduction is authorised provided the source is acknowledged.

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