State aid: Romania needs to recover around €13 million of incompatible rescue aid from Romanian National Uranium Company; cannot implement incompatible restructuring aid
The European Commission has found that various Romanian public support measures in favour of the Compania Națională a Uraniului SA (‘CNU’, the National Uranium Company) are not in line with EU rules on State aid to companies in difficulty. On 12 June 2017, Romania notified to the Commission a plan for the restructuring of CNU, which was experiencing financial difficulties. The restructuring plan followed an urgent rescue aid loan of around €13 million (RON 62 million) granted to keep the company afloat, which the Commission had temporarily approved on 30 September 2016. EU State aid rules only allow a State intervention for a company in financial difficulty under specific conditions. On 8 May 2018, the Commission opened an in-depth investigation to assess whether the initial restructuring plan was in line with these conditions and, hence, with EU State aid rules, in particular the Rescue and Restructuring Guidelines. In the course of the investigation, Romania submitted two amended restructuring plans to the Commission. The Commission’s investigation showed that the latest restructuring plan, like the previous ones, does not dispel the concerns that the Commission had when it opened the in-depth investigation in 2018. Therefore, the Commission concluded that the restructuring plan submitted by Romania is not in line with EU State aid rules. As a result, Romania cannot implement the aid measures envisaged in the plan, which include the State grants and the non-reimbursement of the 2016 rescue loan. Furthermore, the Commission concluded that the 2016 rescue loan of around €13 million (RON 62 million) plus interest which was prolonged and not reimbursed after 6 months is incompatible with EU State aid rules and needs to be recovered by Romania. Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “A government can support a company in financial difficulty if the company has a sound restructuring plan which ensures its return to long-term viability, contributes to the cost of its restructuring and competition distortions are limited. In the case of CNU, these conditions were not met. As a result, Romania cannot further support the company. It must also recover the aid already granted. This will restore the competitive situation in the market and ensure that CNU does not compete unfairly with other more efficient operators. It will also prevent CNU from maintaining inefficient loss-making operations, which could eventually lead to higher electricity prices and a higher cost to the Romanian taxpayers.” The full press release is available online.