Brussels, 11 March 2014
State aid: Commission approves aid for construction of cruise terminal in Liverpool
The European Commission has found that public funding worth £17.8 million (ca. €22 million) granted for the construction of the Liverpool cruise terminal is in line with EU state aid rules. The new infrastructure furthers EU transport policy objectives without unduly distorting competition in the Single Market.
Following a complaint, the Commission started to examine the financing of a new cruise terminal in Liverpool in 2011. The project was conducted by the Liverpool City Council and received funding from the UK (£9.2 million) and from EU Structural Funds (£8.6 million).
The UK carried out an in-depth financial analysis showing that the terminal operator's income from the use of the infrastructure would be insufficient to cover the investment costs over a period of 20 years. Therefore, the project would not be carried out without public funding.
The investment will allow for a better exploitation of sea transport services, particularly in the cruise industry. The Commission found that the public funding was limited to the minimum necessary to make the investment possible. The Commission also found that the potential distortions of competition triggered by the public funding will be limited because the terminal will have a small market share, both in the EU and UK markets. The positive effects of the project will outweigh any potential distortions of competition brought about by the aid.
The Commission therefore concluded that the project is in line with Article 107(3)(c) of the Treaty on the Functioning of the European Union (TFEU), which allows state aid for the development of certain economic activities, provided that it does not unduly affect trade and competition in the Single Market.
The investment was completed in 2007 but was not notified by the UK authorities under the assumption that the funding did not constitute state aid. The Commission has examined the project following a complaint from a competitor.
The public funding of infrastructure investment projects is subject to EU state aid rules when the infrastructure is destined to be commercially exploited (see judgment of the EU General Court of March 2011 in joined cases T-443/08 and T-455/08). Therefore, such projects must be notified to the Commission for prior approval.
The non-confidential version of the decision will be made available under the case number SA.35720 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.