27 November 2008

2 minute read

Europe

The State aid rules for agriculture do allow the granting of aid for BSE tests up to a certain amount, but the Commission received indications that Belgium has granted aid exceeding this amount. Therefore, the Commission expresses its doubts as to the respect of the maximum aid amounts by Belgium.

The Commission started reviewing the aid measures after receiving complaints in 2004. Based on the information received from Belgium, it seems that, since 1 January 2002, the Belgian government pre-financed the costs of compulsory BSE tests of bovine animals.

The national legal basis for the repayment appears to be two royal decrees on the financing of the Federal Agency for the Safety of the Food Chain. According the information provided by the Belgian authorities an amount of direct and indirect aid of € 15 million would have been granted to farmers above the maximum of € 40 per test from 1 January 2003 and Belgium seems to have to started to recover the unlawful aid.

The Commission has doubts as to the compatibility of the aid measures with the applicable State aid rules, the precise amount of unlawful aid and whether the system of recovery of the unlawful aid could be considered as doing away with the distortion of competition caused by the unlawful aid. It has, therefore, decided to investigate whether these measures constitute incompatible State aid by opening a formal investigation procedure under the state aid rules of the EC Treaty.

The full text of the Commission decisions will be published in the Official Journal of the European Union. Belgium and other interested parties will be given one month from the date of publication to submit their comments. After this period, the Commission will rule as soon as possible on the question whether these measures are compatible with the common market.

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