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State aid

Legislation archive

Commission letter to Member States SG(88) D/6181 of 26 May 1988

Dear Sir

Council Regulation (EEC) No 4028/86 of 18 December 1986 on fisheries structures establishes a structural objective for the Community fishing sector. This is accompanied by an aid policy which, on the one hand provides for the possibility of cofinancing the construction of new fishing vessels for the Community fleet, complying with certain conditions laid down in a multiannual guidance programme, through support from Community and national resources, the latter normally allowable up to a level of 30% with the possibility of increasing to a level of 65% in the case of insufficient Community funds and, on the other hand, does not envisage any aid support for such vessels which do not comply with the guidance programme.

Council Directive 87/167/EEC of 26 January 1987 on aid to shipbuilding establishes a structural objective for the Community's shipbuilding sector within the prevailing world crisis in this area in which a certain level of shipbuilding activities is maintained inside the Community through a selective aid policy allowing production aid, irrespective of whether it is granted directly to yards or indirectly through shipowners, up to a total accumulated ceiling of 28%. The Directive includes construction and conversion of fishing vessels of not less than 100 grt. For small vessels costing less than ECU 6 million it prescribes a lower level of aid and the Commission has declared in the minutes of the Council that it will not allow aid exceeding 20% for such vessels.

As the structural policies expressed in the two legal acts are not immediately compatible, the Commission finds it necessary to advise Member States on how it intends to apply the acts.

In the specific and exclusive framework for constructing new vessels intended exclusively for the Community fishing fleet, Community legislation provides that vessels built outside the guidance programme should not benefit from any aid support, either from national or Community sources, whilst on the other hand it provides for the promotion of the construction of vessels falling inside this programme with a particularly high level of aid. In such a situation the aidintensity ceilings of the fisheries Regulation should prevail over the more restrictive ceiling laid down in the shipbuilding Directive since the former is to be seen as a lex specialis in relation to the Directive, a lex generalis. In other cases Article 49 of the fisheries Regulation operates to apply Articles 92 to 94 of the EEC Treaty. In its assessment of the common interest under the terms of Article 92(3)(c) of the EEC Treaty, the Commission hereby informs you that it will consider it as incompatible with the common market aid under the rules of the sixth Council Directive for the construction of fishing vessels for the Community fleet.

This implies that the construction of fishing vessels for the Community fleet comes under the aid policy of Council Regulation No 4028/86 on fisheries structures. Thus aid levels permitted under this Regulation for vessels approved under the multiannual guidance programme prevail whilst vessels not complying with this programme cannot receive any aid support.

On the other hand, fishing vessels of not less than 100 grt constructed for third countries are subject to the rules of Council Directive 87/167 on aid to shipbuilding. Such rules will be interpreted in the light of the Commission's international obligations.

Furthermore it is emphasized that the general principle expressed in Article 3(3) of the Directive that the granting of aid must not lead to distortion of competition between national shipyards and shipyards in other Member States in the choice of placing orders continues to prevail in all cases.

The Commission may review aforementioned rules of application of the two legal acts in the light of their established impact on both the fisheries and shipbuilding policy of the Community.

Yours faithfully

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