The European Commission has opened formal investigation of
Poland's proposal to grant €40.9 million in investment
aid to Fiat Powertrain Technologies Poland.
The aid, which was notified by the Polish authorities early last
year, is designed to support a production of next-generation petrol
engines in the Silesia region of Poland.
The aid is in the form of a tax allowance, a grant under the
Innovative Economy Operational Programme, a direct investment grant
and a direct grant for employment costs. Silesia qualifies for
regional aid of up to 40% under Article 107 (3) (a) of the EU
Treaty because of its abnormally low standard of life and high
unemployment rate.
The Commission decided to investigate the case further because the
initial assessment has shown that Fiat's market share in one of
the passenger car markets exceeds 25%.
The Commission will check whether the planned aid is required to
encourage Fiat to carry out the investment in Silesia and whether
the benefits associated with the aid exceed the potential
distortion of competition. It will also assess the Polish
government's argument that passenger cars and light commercial
vehicles form part of the same product market.
This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to www.law-now.com/law-now/mondaq
Law-Now information is for general purposes and guidance only. The information and opinions expressed in all Law-Now articles are not necessarily comprehensive and do not purport to give professional or legal advice. All Law-Now information relates to circumstances prevailing at the date of its original publication and may not have been updated to reflect subsequent developments.
The original publication date for this article was 15/02/2011.
