Grote vraagtekens Kroes bij Italiaanse staatssteun aan energiebedrijf AEM Torino (en)

The European Commission has opened an investigation under EC Treaty state aid rules, concerning a €16 million subsidy Italy intends to grant to AEM Torino. The aid is intended to cover costs incurred in the liberalisation process of the electricity sector ("stranded costs").

AEM Torino has benefited in the past from aid which the Commission has subsequently declared illegal and incompatible. AEM Torino has not reimbursed the previous aid. According to the case law of the European Court of Justice, the Commission cannot authorise aid to a company that has not yet reimbursed previous illegal aid. Moreover, the Commission has concerns that the new aid would also distort competition.

The opening of the formal investigation will be published in the EU's Official Journal, allowing interested parties to comment. The launch of this inquiry does not prejudge the Commission's final decision.

EU Competition Commissioner Neelie Kroes i said: "Our investigation will have to examine carefully the potential distortions of competition caused by the proposed new aid in combination with the illegal aid that has still not been reimbursed."

AEM Torino is a local utility company (one of the so called "municipalizzate"), that produces, distributes and sells electricity and heating. It also manages street lighting, traffic lights and the electrical and heating systems of the buildings owned by the Municipality of Turin, which has a 70% stake in the company. In 2004, the turnover of AEM Torino was €891 million.

The aid that Italy intends to grant to AEM Torino would compensate for stranded costs in the electricity sector linked to the liberalisation process. The aid amount is around €16 million. The Commission has previously approved several aids to energy companies covering stranded costs based on a methodology applied since 2001 (see IP/01/1077). In particular, on 1/12/2004, the Commission authorised compensation for stranded costs linked to the Italian electricity incumbent ENEL (see IP/04/1429). However, this decision did not concern the `municipalizzate'.

In March 2005, Italy notified its intention to grant aid for the stranded costs of the `municipalizzate'. The calculations made by the Italian authorities led to the conclusion that only one firm - AEM Torino - would be in a position to benefit from the envisaged aid.

However, on 5 June 2002, the Commission had taken a negative decision (see IP/02/817) on fiscal aid granted by Italy to the municipalizzate. After almost four years, Italy has not yet recovered the amounts granted at that time. The Commission has recently decided to refer Italy to Court for failure to act (see IP/05/76).

In accordance with the case law of the European Court of Justice in the Deggendorf case (case C-355/95 P), when assessing the compatibility of new aid, the Commission also has to take into account the fact that the beneficiaries may not have complied with earlier Commission decisions ordering them to reimburse previous illegal and incompatible aid. In such cases, the Commission must verify the effects on the beneficiaries of the combination of the new aid with the old incompatible aid which has not yet been reimbursed.