Brussels, 29 th January 2010
State aid: Commission opens in-depth inquiry into €55 million investment into French car component supplier Trèves
The European Commission has launched an in-depth investigation to establish whether an investment worth €55 million that the FMEA (Fonds de Modernisation des Equipementiers Automobiles) granted to automotive supplier Trèves is in line with EU rules on state aid. The opening of an in-depth investigation allows interested parties to comment on the proposed measures. It does not prejudge the outcome of the procedure.
Competition Commissioner Neelie Kroes said: “We must make sure that the FMEA investment in an ailing company like Trèves will not adversely affect competition in the car industry and respects EU state aid rules".
Trèves is a car component supplier specialising in car interiors and noise insulations.
From 2005 to 2008, Trèves made increasing losses. The company's financial difficulties therefore began long before the economic crisis and became more problematic from the second semester of 2008, when the automotive sector faced difficulties.
In response to the crisis affecting the car sector, the French authorities created at the beginning of 2009 the FMEA ('Fonds de Modernisation des Equipementiers Automobiles'), endowed with €600 million, coming respectively from the 'Fonds Stratégique d'Investissement' (FSI – a French public fund) and the two French car manufacturers, Renault and Peugeot. The FMEA was set up to make risk capital investments in companies belonging to the French car parts sector. The FMEA is managed by CDC Entreprises, which belongs to the French public group Caisse des Dépôts.
The FMEA invested €55 million in Trèves, partly as equity, partly as convertible bonds. The French authorities did not notify the investment as they consider that the FMEA is primarily under the influence of the two car manufacturers, who are private investors.
In its preliminary assessment, the Commission considers that the investment by the FMEA must be considered as involving French State resources. Under EU state aid rules, investments of state resources in companies carrying out economic activities can be considered free of aid only if they are made on terms that a private player operating under market conditions would have accepted (the market economy investor principle). During the formal investigation procedure, the Commission will therefore assess whether the investment in Trèves respected the market economy investor principle or whether it brought an economic advantage to the company and could therefore constitute state aid.
If the inquiry were to result in the finding that the investment by the FMEA could be qualified as a state aid, the Commission would then need to assess if such aid could be declared compatible with EU rules, for instance on the basis of the rules applicable to aid for restructuring companies in difficulties. The limited information the Commission has on the investment in Trèves seems to indicate that it was taken in the context of a restructuring plan of the company which included significant own contributions.
The non-confidential version of the decision will be made available under the case number NN64/2009 in the State Aid Register on the DG Competition website once any 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 .