Brussels, 12/06/2006 (Agence Europe) - On Thursday the European Commission decided that a write-off of tax debt of SKK 416. 5 million (€11 million) to Slovak spirits producer, Frucona Košice, constituted illegal state aid. In a press release Neelie Kroes commented: “We have taken into account the size of the company and the fact that it is in an underdeveloped region. Nevertheless, the measure was pure operating aid, without any genuine restructuring to restore Frucona's sustainable commercial viability”. In 2004, the tax office agreed to write off 65% of its debt (€ 16.9 million). The Commission said that this behaviour was not that expected of a normal commercial creditor in a market economy. The Commission concluded that the tax office would have obtained a higher repayment of its claims through a bankruptcy procedure. The debt write-off therefore constituted state aid and was not compatible with the Commission's guidelines on restructuring aid and should be recovered by the Slovak authorities.