EU gives green light to shipyard rescue plan

1st June 2005, Comments 0 comments

1 June 2005, BRUSSELS — The European Union gave the green light to a Spanish rescue of military shipyards on the grounds the move protects national security interests.

1 June 2005

BRUSSELS — The European Union gave the green light to a Spanish rescue of military shipyards on the grounds the move protects national security interests.

Madrid is salvaging the military shipyards of bankrupt, Spanish state-owned shipbuilder Izar through a takeover by a new state company called Navantia.

EU regulators approved the rescue on condition that the shipyards be operated under strict conditions to ensure that government aid for its military business was not used to subsidize commercial shipbuilding activities.

"Combined with the foreseen sale of Izar's civil shipyards and general social measures, this reorganisation will safeguard Spain's military shipbuilding needs, and eliminate distortions of competition in the civil shipbuilding," EU competition commissioner Neelie Kroes said.

EU regulators police state aid to make sure it is in accordance with competition law and does not give one company an unfair advantage over another.

After discussions with the commission, Spain agreed to a number of measures and commitments to ensure that competition remained healthy in the market.

The future of the shipyards was thrown in doubt last year after Brussels demanded that Izar repay millions of euros of government aid that was found to be illegal under EU competition rules.

But Madrid then invoked EU rules on protecting the national security interests.

Izar was put into liquidation at the beginning of April.

[Copyright EFE with Expatica]

Subject: Spanish news

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