Brussels, 10/04/2002 (Agence Europe) - On Tuesday, the European Commission decided that part of the State aid intended to cover operating losses of the French coal industry for the years 1994 to 1997 is not compatible with Community legislation. It thus closes the procedure begun in February 1999 against France, following a complaint filed by five coal traders against the public company, Charbonnages de France.
This decision resulted in Charbonnages de France (CdF) having to pay back the sum of EUR 18 416 018. This is part of the aid notified by France for the years 1994, 1995, 1996, which had been fully authorised by the Commission. The sum of EUR 1 526 274, that is, part of the aid notified for the year 1997, is considered incompatible with Community legislation. Out of the aid notified in 1997, the Commission had reserved its opinion on the sum of EUR 5 335 716. Out of this amount, the Commission therefore today only clears EUR 3 809 442. For aid notified for the years 1998 to 2001, the Commission will enact at a later date with respect to the principles set out in the decision adopted on Tuesday. The Commission has already authorised aid relating to these years subject to certain amounts being retained provisionally. France must take all the measures necessary to recover the aid paid out from CdF. It must inform the Commission what measures it has taken to this effect within two months counting from the date when the decision was notified.
According to the complainants, the CdF group sells coal subsidised on the French industrial consumer market at a price that is generally lower than that practised on the world market. This price would only be possible with the help of State aid to support coal production. Not being able to offer coal at equally favourable coal supply conditions, the complainants consider they have been kept away from a large part of the industrial consumer market. After analysis of the data provided by France, as well as the observations made by third parties, the Commission concluded that part of the aid in favour of the coal industry that France notifies each year to the Commission is in breach of the provisions and objectives of the Decision No 3632/93/ECSC. This decision imposes a minimum price which must be taken into account for calculating aid intended to cover losses linked to coal production, namely the price of coal on international markets. Sizeable discounts have been granted to CdF clients, which have encouraged the group to sell coal at a lower price than prices prevailing on the international markets. Aid that may be granted by the Member States in compliance with the above-mentioned decision are exclusively reserved for Community coal. Aid was paid for sales of national coal and equally for sales of imported coal. The Commission therefore felt that the practices implemented by CdF and financed by State aid have created competition distortion on the Community market.