Brussels, 27 October 2010
State aid: Commission opens formal investigation into possible infrastructure aid to German paper mill Propapier
The European Commission has opened a formal investigation to establish whether a new wastewater plant and surrounding infrastructure built by the German state constitute state aid in favour of Propapier's paper mill in Eisenhüttenstadt (Brandenburg, Germany). At this stage, the Commission cannot exclude that Propapier derives a predominant benefit from the infrastructure or part of it. The opening of an in-depth investigation gives interested third parties a possibility to comment on the measures and provides legal certainty. It does not prejudge the outcome of the investigation.
The Commission has opened an investigation following a complaint by a competitor of Propapier, alleging in particular that Germany granted illegal state subsidies by constructing a dedicated waste water treatment plant, a new road and a parking lot, as well as enlarging the Oder-Spree-Canal, all to the benefit of Propapier. Furthermore, the fees charged for processing waste water in a sewage plant are allegedly lower than what a private investor would charge for these services.
The waste water treatment plant, which is publicly operated by a municipal association ("Zweckverband"), received funding from the German regional development programme "Gemeinschaftsaufgabe", approved by the Commission in 2003.
As regards the allegation that Propapier benefits from advantageous waste water treatment fees, Germany argued that the fees are the same for all users and that the calculation of the fees is determined by law. At this stage, the Commission has doubts that this would automatically exclude the possibility that Propapier derives a specific and selective advantage from the system. Due to the general accessibility of the new road, the parking lot and the Oder-Spree-Canal the Commission tends to consider that these measures are less likely to confer a selective advantage to Propapier. However, on the basis of the information available, the Commission cannot entirely exclude that Propapier may benefit more from this infrastructure than other companies.
During the formal examination the Commission will investigate whether the measures constitute state aid and if so, whether they are compatible with EU state aid rules, in particular with the Regional Aid Guidelines 2007-2013 (see IP/05/1653).
The non-confidential version of the decision will be made available under the case number C30/2010 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.