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State Aid

PR(09)59: Provisions of Icelandic Harbour Act in breach of the EEA Agreement.

15.7.2009

The EFTA Surveillance Authority concluded today, after a formal investigation, that certain amendments to the Icelandic Harbour Act passed in 2003 and in 2007 breach EEA competition rules and represent incompatible state aid.

The Authority has concluded that the funding of certain quay installations, and damage compensation for those installations, as well as for ship lifts and hoists, as provided for in the Icelandic Harbour Act, constitutes incompatible state aid. The Authority has also decided that this funding cannot be justified as the Act limits funding to harbours owned by municipalities and not to the private sector.

Amongst other provisions, the Icelandic Harbour Act specifies the broad framework for eligibility of financial support to Icelandic municipalities from the Harbour Improvement Fund. Whilst the majority of this funding has already been approved as funding of activities that are essential in the public interest and fall within the responsibility of the state, some activities undertaken by municipalities in harbours are commercial in nature and are subject to competition from other economic operators.

The Authority has however considered that the funding of pilot vessels does not constitute state aid, concurring with the Icelandic authorities that such vessels perform an essential safety functionnecessary in the public interest.

For further information, please contact:

Mr. Dylan Hughes
Officer
, Competition and State Aid Directorate
Tel. (+32)(0)2 286 18 80, or

Mr. Per Andreas Bjørgan
Director, Competition and State Aid Directorate
Tel. (+32)(0)2 286 18 32

 

Brussels, 15 July 2009




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