Brussels, 17 November 2010
State aid: Commission approves €19.7 million public funding for innovative Dutch regional jet
The European Commission has authorised The Netherlands to grant a repayable advance of €19.7 million to Rekkof Aircraft N.V, for the development of a new generation of Fokker regional aircraft. The Commission found the aid to be compatible with the EU Framework for State aid for research, development and innovation (see IP/06/1600 and MEMO/06/441). The aid, which is limited to the minimum necessary, will allow Rekkof to launch the critical development phase of the programme and will act as an incentive for private investors to join the venture.
Commission Vice-President in charge of competition policy Joaquín Almunia said: "If Rekkof's ambitious project is a success, there will again be a manufacturer of regional jet aircraft in Europe, and an industrial gap will have been closed. There would also be a positive spill-over of technical knowledge to the benefit of the aeronautics sector and other industries in the EU. The project contributes to the EU-2020 goal of Smart Growth, by strengthening knowledge and innovation".
Under the notification, the Netherlands will grant Rekkof Aircraft €19.7 million in the form of a repayable advance to fund the experimental development of several aircraft components such as winglets and avionics. The repayable advance will also finance the adaptation of a jet engine and the integration of a demonstrator aircraft for final concept validation. The aircraft will be marketed as the 'Fokker Next Generation'.
The project requires substantial up-front investment before the new aircraft is ready to be delivered, which is expected for late 2015 or early 2016. The Commission found that Rekkof has done its utmost to attract external private funding for its jet programme. Nevertheless, a public risk-sharing element was necessary to tackle the challenges of the project's first phase, where critical design and development are carried out. A large amount of private capital is expected to be injected into the project subsequently.
The emergence of a new European integrator of regional jets and the subsequent establishment of a new supply network will trigger new relationships with companies within the aerospace business but also outside, and with research institutes. A large number of future suppliers will be SME's, allowing them to boost their system-integration capabilities. Rekkof will share its knowledge with research institutes and will also disseminate its design, development, production and marketing capabilities to other industries.
The entry of Rekkof will stimulate the growth dynamics of the regional-jet market, where currently there are only a few producers, all of which are outside Europe. Given the market's growth prospects, the aid will not crowd out Rekkof's competitors, who are also busy developing new jets.
The Commission therefore concluded that the positive effects of the aid outweigh any potential distortion of competition.
The non-confidential version of that decision will be made available under the case number N 144/2010 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.