92001E0365

WRITTEN QUESTION E-0365/01

by Glyn Ford (PSE) to the Commission

(14 February 2001)

Subject: Xerox restructuring aid from the Irish Government

Xerox is currently in the process of restructuring its European Manufacturing Operations at Venrey, in Holland, Mitcheldean in the UK and Dundalk in Ireland.

However, this restructuring is in danger of being distorted by the fact that Xerox will have to repay thousands of euros to the Irish Government, granted as an incentive to bring it to Dundalk two years ago, for each job lost in Ireland.

Does not the Commission feel that these barriers breach the spirit and, possibly, the letter of European legislation on the establishment of a single European market place?

Answer given by Mr Monti on behalf of the Commission

(5 April 2001)

The Xerox plant in Dundalk, which manufactures computers and other information processing equipment, was awarded initial investment aid in the form of capital and employment grants. Operations at the plant have started and some of the incentives have been paid.

The regional aid schemes concerned are approved by the Commission as falling under the derogation foreseen in Article 87(3) (ex Article 92) of the EC Treaty.

The inclusion of requirements in grant agreements that grants paid in respect of specific investments be repayable if they are not maintained for a number of years is explicitly foreseen under paragraphs 4,10 and 4,14 of the relevant Commission's guidelines, namely the Guidelines on national regional aid(1). This provision is aimed at preventing misuse of public money, namely by transferring equipment bought through State aid to another region, which is not eligible to support. At the same time, the five-year clause stems from the necessity to ensure the investment aided has an impact on regional development in that specific region, which would be endangered, were the undertaking allowed to move somewhere else within a short time.

(1) OJ C 74, 10.3.1998.