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PR(98)20: EFTA Surveillance Authority clears State aid for investment in MABO A/S in Surnadal, Norway


The EFTA Surveillance Authority  today decided not to raise objections to State aid which the municipality of Surnadal in Norway has planned to provide in support of investment in MABO A/S.

Mabo A/S produces plastic pipe and pipe parts in polyvinyl chloride (PVC), polypropylene (PP) and polyethylene (PE) for indoor installations, water, sewage, agriculture and cable protection. In addition to production in Norway, the company has production facilities in Sweden, Finland and Poland. At the end of 1996 the company had 472 employees.

The aid project consists of investment in an extension and upgrading of the production in Surnadal. Total investment costs are NOK 21.09 million (ECU 2.4 million). Surnadal municipality has decided to grant state aid to Mabo in Surnadal through the Local Enterprise Fund. The municipality wants to grant the company NOK 2.52 million (ECU 0.3 million) in investment grant.

The investment grant from the Local Enterprise Fund is taxable. Taking into account the corporate tax rate of 28%, the grant of NOK 2.52 million constitutes aid amounting to 8.6% of the eligible investment costs. The aid intensity is therefore below the relevant maximum aid ceiling for regional investment aid of 25% which the Authority has approved for the Norwegian target zone B, covering the municipality of Surnadal.

The EFTA Surveillance Authority has therefore concluded that the aid granted by the municipality of Surnadal to MABO A/S qualifies for exemption under Article 61(3)(c) of the EEA Agreement as aid to facilitate the development of certain economic areas, without adversely affecting trading conditions to an extent contrary to the common interest.

For further information please contact Amund Utne on tel. +32-2-286 18 50 or Rolf Egil Tønnessen on tel. +32-2-286 18 56.

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