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PR(06)26: The EFTA Surveillance Authority opens a formal investigation procedure to examine state aid to the wood sector

17.5.2006

Today the Authority decided to open the formal investigation procedure in respect of a Norwegian aid scheme for purposes of providing grants to support the wood sector on the basis of "Verdiskapningsprogrammet for tre" (the "Wood Scheme"). 

The Wood Scheme was introduced in 2000 for a five-year period onwards. The purpose of the scheme is to award grants to undertakings which could contribute to the broad objectives of improving the processing of woodwork, increasing the use of woodwork and improving relations on different levels of trade between the forest and the market. The Wood Scheme, which was not notified to the Authority, is being investigated on the basis of a complaint. The Authority has taken the preliminary view that the Wood Scheme involves the grant of state aid.

The Authority has assessed whether aid granted under the Wood Scheme would be compatible with the EEA Agreement. The Wood Scheme has been assessed on the basis of various rules that provide for exemptions from the general prohibition on the grant of state aid (inter alia rules on regional aid, aid for research and development and aid to small and medium-sized enterprises). On the basis of the preliminary investigation the Wood Scheme has not been found to comply with any of these rules. Consequently, the Authority has doubts whether the Wood Scheme is compatible with the EEA Agreement.

To the extent that the Authority finds in its final decision that aid under the Wood Scheme is incompatible, the Authority will require that such aid is recovered from the recipients.

A decision to open the formal investigation procedure is without prejudice to the final decision to be adopted by the Authority. The opening decision will be published in the EEA Section of the Official Journal of the European Union and the EEA Supplement thereto, inviting for the submission of comments within one month from the date of publication. For information purposes the decision will also be published on the Authority’s website.

For further information, please contact:
Mrs Lena Sandberg-Mørch,
Officer, Competition & State aid Directorate,
tel. (+32)(0)2 286 18 69

For general information about the EEA state aid rules, please consult the Authority's website: www.eftasurv.int.

17 May 2006




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