Brussels, 28/12/2005 (Agence Europe) - The European Commission has approved the prolongation of the Economic and Fiscal Regime (REF) of the Canary Islands (Spain) until the end of 2006. The measure is intended to promote economic activity in the Canary Islands, enabling companies established in an area qualified as a peripheral region to overcome their natural structural handicaps. The €270.5 mil aid will boost business start-ups with measures including a tax break on income from the sale of goods in the stockbreeding, fisheries, agricultural and industrial sectors, produced in the Canary Islands; a tax reduction for companies on profits generated in their establishments located in the Canary Islands which are assigned to constitute an investment reserve. The amounts assigned to this reserve should be employed for the acquisition of fixed assets located in the Canary Islands or buying shares in enterprises that carry out their activities in the Canary Islands, as long as these enterprises make investments in fixed assets. The Commission took into account that the Canary Islands are fully eligible, under the derogation provided for in Article 87(3)(a) of the EC Treaty, for aid in favour of regions with high unemployment or a low standard of living until 31 December 2006. The Commission's examination of the Economic and Fiscal Regime (REF) of the Canary Islands showed that the aid is proportionate to the additional costs resulting from these handicaps, and is thus in line with the general objective of furthering the development of the outermost regions.