IP/09/334

Brussels, 27 February 2009

State aid: Commission authorises temporary scheme of flat-rate aid of up to €500 000 for businesses in Luxembourg

The European Commission has, under the state aid rules of the EC Treaty, authorised the first in a series of aid measures for businesses adopted by Luxembourg to deal with the current economic crisis. This measure will enable Luxembourg to grant until 31 December 2010 aid of up to €500 000 to businesses likely to have a structural impact on the national or regional economy.

"This measure would give a shot in the arm to businesses affected by the current economic situation without causing undue distortions of competition. The effectiveness of the Luxembourg authorities’ response had enabled the Commission to come to a decision very quickly," said Competition Commissioner Neelie Kroes.

The scheme meets the conditions imposed by the Commission’s temporary framework, which gives Member States greater flexibility in granting state aid and providing businesses with improved access to financing during the economic and financial crisis (see IP/08/1993). The scheme proposed by Luxembourg is compatible with Article 87(3)(b) of the EC Treaty, which permits aid intended to remedy a serious disturbance in the economy of a Member State.

The scheme has been designed on the basis of the provisions of the temporary framework that deal with compatible aid of a limited amount. In particular, the maximum amount of aid does not exceed €500 000 per company and the scheme applies only to businesses which were not in difficulty on 1 July 2008 or which were not in difficulty then but became so subsequently as a result of the economic crisis.

This scheme is the first measure authorised for Luxembourg under the new temporary framework for state aid.

The decision will be made available under case number N 99/2009 in the State Aid Register on the DG Competition website once all the confidentiality issues have been resolved. New publications of state aid decisions on the Internet and in the Official Journal are listed in the State aid Weekly e-News.