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Brussels, 28 January 2009

The Commission investigates Portuguese aid for the collection, transportation, treatment and destruction of slaughterhouse waste

The European Commission has today decided to open a formal investigation procedure, under the Treaty rules on State aid, into the aid which Portugal has been granting since 1998 to cover the costs of the collection, transportation, treatment and destruction of mammalian and poultry meat by-products. The aid has been funded by means of parafiscal charges levied inter alia on any overcompensation given to undertakings which provide services and on any benefit granted to slaughtering and cutting centres and to livestock farmers for services rendered to them.

Following a complaint in 2002, the Commission examined the system which the Portuguese authorities have been operating since 1998 to cover the costs of the collection, processing and destruction of mammalian and poultry meat by-products and to mitigate the effects of the measures adopted to combat BSE. The system was introduced inter alia by means of Decree-Law No 197 of 25 September 2002.

As the Portuguese authorities have stated that the collection, transportation and destruction of slaughterhouse waste constitute a public service, the Commission has asked Portugal questions several times about, for example, the compensation paid for this public service, the costs to which the obligations give rise, and the taxes levied to finance the services. Since it has not received answers to all the questions it put, the Commission issued a formal request to Portugal on 21 February 2006 to provide all the information sought. Portugal has failed to reply to the official request for information. The Commission therefore still has doubts about the measure in question and has taken the decision to open the procedure.

The Commission is giving Portugal one month to supply information about the measures in question. It will also publish its decision in the Official Journal to enable third parties to send it their comments on the subject. Once it has received the information requested, the Commission will take a final decision on whether aid has been given and whether that aid is compatible with the Treaty.

Given that Portugal has not complied with its obligation under Article 88(3) of the Treaty to cease applying the measure or with the ban on the payment of aid until the Commission has taken a decision, should the Commission decide that the aid being investigated under the procedure launched today is incompatible with the Treaty, beneficiaries may find themselves forced to pay back the aid granted.

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