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European Commission - Press release

State aid: Commission orders recovery of incompatible state aid in favour of Bulgaria's Ruse Industry

Brussels, 13 July 2011 – After an in-depth investigation, the European Commission has concluded that the Bulgarian metal manufacturer Ruse Industry, now in bankruptcy proceedings, has received subsidies in the form of unpaid debts to the State of around €3.7 million.

The company has been in difficulties for several years. In June 2009, the Bulgarian authorities notified the Commission of plans to restructure Ruse Industry AD and its debt. In April 2010, the Commission opened an in-depth investigation (see IP/10/427). The notified restructuring was withdrawn by Bulgaria in November 2010, but the Commission has continued its investigation into the aid involved in view of the State's failure to enforce its debt in previous years. On 11 November 2010, the Bulgarian authorities filed for bankruptcy proceedings against Ruse Industry.

The Commission believes that Ruse Industry benefitted from state aid as any other creditor would have sought the repayment of the debt sooner and more effectively. This creates distortions of competition vis à vis other companies, who had to operate their businesses without such support and were subject to the discipline of credit markets. In order to remedy this distortion, the aid to Ruse Industry should be recovered.

This is the first time the Commission orders Bulgaria to recover illegal and incompatible aid from a beneficiary. The purpose of recovery is to re-establish the situation that existed on the market prior to the granting of the aid, thereby cancelling or at least alleviating the distortion of competition brought about by the aid. This is necessary to ensure a level-playing field in the internal market. The Commission's recovery policy is set out in its 2007 Recovery Notice. The Commission can only order the recovery of the aid as from the time when Bulgaria became a member of the EU, on 1 January 2007.

Background

The non-confidential version of the decision will be made available under the case number C 12/2010 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

Contacts :

Amelia Torres (+32 2 295 46 29)

Maria Madrid Pina (+32 2 295 45 30)


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