Brussels, 21/06/2001 (Agence Europe) - On Wednesday, the European Commission decided to open the formal investigation procedure into part of the aid granted to Klausner Nodric Timber GmbH & Co. KG (KNT) for the creation and extension of a sawmill in Wismar, Germany.
The aid granted by German to KNT covers two projects: the creation of a sawmill in Wismar (Land of Mecklembourg, West Pommerania) in 1997 on the one hand, and its extension, which began in 1998, on the other. In response to an injunction sent by the Commission last August, Germany asserts that the aid in favour of these investments corresponds to the authorised level and was in accordance with the regional aid system approved by the Commission, KTN being an SME and thus capable of receiving the aid granted.
As for the Commission it feels that since 1999 the beneficiary of the aid is no longer an SME and that the total aid granted to the two projects exceeds the authorised intensity ceiling for large companies in the region. To define the size of the beneficiary, it examined the legal and property relationships as well as the economic integration between KNT and another sawmill, Klausner Holzindustries GmbH & Co. KG. At this stage, it feels that the beneficiary of the aid cannot be considered as a single legal entity KTN, but must be defined as an economic unit formed by the two companies.
Thus the Commission concluded that the aid concerned in favour of the two projects in 1999 and 2000 did not come from three aid systems approved and should be considered as ad hoc aid. Given the size of this aid, the Commission doubts that all of it is compatible with the common market, the ceiling for authorised regional aids in this area seeming to be exceeded.