Poland: state aid rulings

Three important Polish state aid cases have been decided recently by the European Commission, while UOKIK has also been active in this area.

Extension of support schemes
The Commission has approved a 6-month extension (until 30 June 2011) for two support schemes, ruling that they were appropriate measures for remedying a serious disturbance in the Polish economy.
It ruled that extending Poland’s recapitalisation scheme was compatible with the requirements set out in its 2010 Communication on support measures for banks during the financial crisis, and that Poland’s guarantee scheme was compatible with its guidance on state aid to financial institutions during the crisis.

Aid for Wieliczka and Bochnia salt mines
The Commission also approved €240 million in public funding granted by Poland between 2004 and 2013 for protection and security works in the heritage salt mines of Wieliczka (registered on UNESCO list of the World Heritage) and Bochnia, both located in the south of Poland. It ruled that the works were technically indispensable to preserve the salt mines, the aid was limited to the minimum necessary to carry out these works, and that it would not adversely affect trade between member states.

Flood assistance
The Commission has approved over €182 million financing from the EU Solidarity Fund for assistance relating to the floods in May and June 2010 in Poland and five other countries. Over €105 million in aid has been authorised for Poland but still needs to be confirmed by the European Parliament and Council in early 2011. It is therefore likely to be paid out in March 2011.

Zakłady Chemiczne Police
UOKIK, the Polish Competition Authority, has also notified the Commission of an aid plan for restructuring the chemical company Zakłady Chemiczne Police. In June 2010 the Commission approved an aid package of PLN 150 million for rescuing the company. On the basis of the decision the company had to either pay back within 6 months the loan given by the Industrial Development Agency or prepare a restructuring plan guaranteeing its profitability. The company decided to prepare a restructuring plan, which envisages a loan from the Industrial Development Agency amounting to PLN 150 million from the Fund for Entrepreneurs’ Restructuring, and amortisation of PLN 10 million in environmental fees and repayment in monthly instalments until the end of 2011 of c. PLN 17 million due to the Marshal of the Westpomeranian Region.

2009 Report on State Aid
UOKIK’s report which was published a week ago shows that state aid of over PLN 19 billion (c. €5 billion) was provided in 2009, including PLN 3 million for transport. The most common forms were tax allowances and grants, which comprised 85.4% of all aid excluding transport aid.