IP/07/1801
State aid: Commission authorises €800 000 restructuring aid to Polish mechanical engineering company Techmatrans

Brussels, Belgium – The European Commission has concluded that a planned €800 000 aid to Techmatrans in Poland, is compatible with EC Treaty state aid rules. Following an in-depth investigation launched in February 2007 (see IP/07/212 ), the Commission found that the restructuring plan is sufficient to restore the firm’s viability without unduly distorting competition in the Single Market.

Competition Commissioner Neelie Kroes said: “I am happy that we can approve aid for Techmatrans, that should lead to its prosperous development in the long term and secure many jobs in one of the less developed regions of Europe without harming competition.”

Techmatrans produces technological transportation devices and systems for industrial plants in the automotive, metallurgical and construction sectors. It also deals with the repair, service and modernization of transport technology systems. From 2001 to 2004, the company accumulated important losses because of its low production technology level, low productivity, significant loss making contracts and subsequent liquidity problems.

In August 2006 Poland notified its intention to support the company through a capital injection of €800 000 to be granted by the State owned Industrial Development Agency.

The Commission’s in-depth investigation found that the proposed measures comply with the requirements laid down in the Community guidelines on state aid for rescuing and restructuring firms in difficulty (see IP/04/856 and MEMO/04/172 ). In particular, the Commission considers that the restructuring plan is apt to restore the long-term viability of Techmatrans. Moreover, the Commission found that the aid is limited to the minimum necessary and would not provide the company with extra cash. Finally, the restructuring plan foresees compensatory measures, to ensure that competition will not be unduly distorted by the aid, as the company resigns from one of its activities, thus reducing its market presence.

The non-confidential version of the decision will be made available under the case number C 6/2007 in the State aid Register on the DG Competition website once any confidentiality issues have been resolved. New publications of state aid decisions on the internet and in the Official Journal are listed in the State Aid Weekly e-News.