Does the state aid for the banking sector not break relevant procedures? How does the European Commission calculate aid when there are no clearly defined criteria? A meeting organized by UOKiK sought to answer these and more questions.

“One of the most important issues is introducing mechanisms which would make it possible to assess the efficiency, effectiveness and transparency of the aid granted from the point of view of its influence on the state of competition on the market,” said Małgorzata Krasnodębska-Tomkiel, the President of UOKiK, opening the European forum on state aid granted to undertakings. Referring, in turn, to the financial crisis and the support granted to banks in the recent weeks, Herbert Ungerer, representative of the EU Directorate General for Competition, said: “This support is not unconditional. The banks have to implement restructuring plans which have been presented to the European Commission.” Apart from the issue of the effectiveness of state aid during the financial crisis discussions at the Forum also focused on the recovery of aid found incompliant with EC rules, as well as the EU reform of state aid.

The meeting also provided an opportunity to present once more the role of UOKiK in respect of state aid. The main tasks of the President of the Office in this sphere consist in issuing opinions on state aid projects, notifying them to the European Commission, providing the Commission, on behalf of the Polish authorities, with information and documents, as well as answering questions sent by the Commission during its proceedings.

In 2008 the Office issued 20 opinions regarding planned aid schemes and 16 concerning individual aid. UOKiK also received 174 applications for de minimis aid and 378 applications for interpretation on whether planned or already granted aid was lawful or not. Among recent examples there is the modernization and redevelopment of the Legia football stadium to be co-funded by the Warsaw city hall. In this case, according to the Office, the PLN 467 million-plus reserved for this purpose does not constitute state aid since it will be used for the renovation of an object belonging to the City of Warsaw. What may only need clarification is the amount of rent payable for leasing the facility, and more specifically assessing whether it corresponds with market conditions and thus if it does not constitute unlawful aid for the lessee of the stadium.

The European Commission must be notified of all kinds of support which undertakers receive. No aid can be granted until the Commission has approved it. The only exception is de minimis aid, i.e. EUR 200 thousand which an undertaking receives over the course of three subsequent years, as well as aid granted under block exemptions. Since the beginning of 2008 UOKiK has notified 13 aid schemes and 15 individual aid projects to the Commission. Among the latest is a draft resolution submitted on 24 September and envisaging financial aid for eight Polish airports: Kraków-Balice, Gdansk-Rębiechowo, Katowice-Pyrzowice, Poznań-Ławica, Szczecin-Goleniów, Wrocław-Strachowice, Warszawa-Okęcie and Rzeszów-Jasionka. The support will come from the Cohesion Fund, as part of the Operational Programme Infrastructure and Environment for 2007-2013. Its assumed amount is around EUR 251.5 million.

UOKiK also serves as the intermediary between the Commission and the national bodies granting state aid in the case when the Commission issues a decision on the recovery of aid granted contrary to the EC provisions. So far such a situation has only happened three times: Huta Częstochowa had to return EUR 4 million, Grupa Technologie Buczek - EUR 5.35 million and Arcelor Huta Warszawa - EUR 2 million, even before a negative decision was issued by the Commission. The Office can also represent Poland in proceedings before the European Court of Justice and the Court of First Instance - UOKiK may lodge appeals against decisions of the Commission and the Court of First Instance under approval of the Polish Council of Ministers.

At the moment, the Commission is carrying out proceedings concerning the shipyards in Gdansk, Gdynia and Szczecin. The Commission has doubts if the restructuring done so far and scheduled for the future will lead the shipyards to recover a lasting ability to compete in the market, if the own contribution to the restructuring costs is significant, whether adequate compensatory measures have been used and if the amount of aid has been limited to the necessary minimum. It is worth noting that despite the proceedings, the shipyards are still receiving aid, which follows from the necessity to maintain their functioning until the end of the privatization process. The role of UOKiK in this process is to provide the Commission with all the information it requires, e.g. the data on the amount of support which are prepared by the shipyards and verified by the entities granting the aid.

Additional information:
Małgorzata Cieloch, Spokesperson for UOKiK
Pl. Powstańców Warszawy 1, 00-950 Warsaw, Poland
Tel. (+48 22) 827 28 92, 55 60 106, 55 60 430
faks (+48 22) 826 11 86
E-mail: [SCODE]bWNpZWxvY2hAdW9raWsuZ292LnBs[ECODE]