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State Aid

PR(08)03: EFTA Surveillance Authority finds Wood Scheme incompatible with EEA law

23.1.2008

EFTA Surveillance Authority finds Wood Scheme incompatible with EEA law

The Norwegian aid scheme for providing grants to support the wood sector (“Verdiskapningsprogrammet for tre”, or the “Wood Scheme”) was today the subject of a negative decision by the Authority, finding the Scheme as such incompatible with the EEA Agreement. 

The Wood Scheme was introduced in 2000 for a five-year period. The purpose of the scheme was 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. There is extensive trade within the EEA of wood products and Norway is a substantial exporter and importer in the sector. In addition, wood is merely one of many raw materials used in the construction industry and the Wood Scheme, which was not notified to the Authority, has been investigated on the basis of a complaint from a competing sector.

The Authority has taken the view that the Wood Scheme involved the grant of state aid. Moreover, in the opinion of the Authority the Wood Scheme does not comply with certain of the rules for granting regional aid, aid for research, development and innovation, and aid to small and medium-sized enterprises. Consequently, the Authority has concluded that the Wood Scheme was not compatible with the EEA Agreement.

In line with the procedural rules aid granted under the Wood Scheme must be recovered from the recipients. However, this is without prejudice to the fact that individual grants, which have been awarded in compliance with the material state aid rules, must not be recovered. The extent of recovery may therefore be limited.

The decision will be published in the EEA Section of the Official Journal of the European Union and the EEA Supplement thereto. For information purposes the decision will also be published on the Authority’s website: www.eftasurv.int.

For further information, please contact:

Mr Amund Utne
Director, Competition and State aid Directorate,
Tel (+32)(0)2 286 18 50

Mrs Lena Sandberg-Mørch,
Officer, Competition and 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.

 

January 23 2008




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