91998E1423

WRITTEN QUESTION P-1423/98

by Honório Novo (GUE/NGL) to the Commission

(29 April 1998)

Subject: Restructuring and financial adjustment of the EPAC agrifoodstuffs and cereals company

In December 1997 the Portuguese Government notified the European Commission of the measures to be taken as part of the plan for the restructuring and financial adjustment of the EPAC Agrifoodstuffs and Cereals Company.

Following receipt of this information, the Commission asked the Portuguese Government for eleven further items of information which it considered necessary before it could assess the EPAC restructuring project and determine whether it complied with the provisions of the Treaty on European Union.

On 1 April 1998 the EPAC Management Board decided to go ahead with the division of the company into two entities (EPAC Commercial and EPAC S.A., the latter facing closure in the near future) and took steps to dismiss workers from the present EPAC company, most of whom will face long-term unemployment, given their age.

These decisions taken by the EPAC Management Board may of course form part of the plan for the restructuring and financial adjustment of the company, forwarded to the EC in December 1997. However, as far as I know, the Commission has not yet given an opinion on the plan.

1. Will the Commission state whether the decisions taken by the EPAC Management Board were part of the measures proposed in the plan for the restructuring and financial adjustment of the EPAC company, forwarded by the Portuguese Government in December 1997?

2. If so, given that the Commission has not yet delivered a final opinion on the restructuring plan, does it consider it acceptable that the EPAC Management Board has taken decisions which possibly form part of a plan not yet approved by the Commission, in particular with regard to the dismissal of around 120 workers?

Answer given by Mr Fischler on behalf of the Commission

(4 June 1998)

The Commission can confirm that the Portuguese government notified in December 1997 a programme for restructuring and financial adjustment of the publicly owned cereal trading company Entreprise publique d'approvisionnement des céréales (EPAC). Since the notified measures concern, among other, the granting of state aids in the meaning of Article 92(1) of the EC Treaty, the Commission is currently assessing these state aids according to the EC Treaty's competition provisions.

Due to the complexity of the file and its links to other notified state aid cases (Silopor), the Commission has until now been unable to formally express its views on the notified programme. Consequently, it cannot at the present stage reveal the contents of the said programme.

The Commission would nevertheless like to point out that, insofar as matters such as the splitting of two companies and the dismissal of a certain number of a company's workers do not involve the granting of illegal state aid, it is not within its powers to issue opinions about them, even if the company is publicly owned.