EU announces investigation into planned GM aid
The European Commission announced yesterday that it is investigating a $6.6 million dollar subsidy grant planned for General Motors of Europe. The aid package was to be supplied by the Belgian regional government in Flanders and go towards training employees at the EuroGeneral's plant in Antwerp.
EU authorities are openly skeptical that the funds would actually go towards funding training, fearing that the hefty subsidy would be used for other non-approved ends. Under state trade rules, national and/or regional governments are banned from giving aid to a non state-owned entity if such arrangements upset EU competition rules.
[Sources: Associated Press via Forbes; paed.uni-muenchen.de]
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Reader Comments (Page 1 of 1)
whofan 7:10AM (4/27/2006)
I thought Opel was doing well for GM and it was the American operations that were faultering?
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Gardiner Westbound 7:40AM (4/27/2006)
We should have similar rules here. It's crazy jurisdictions engage in bidding wars with taxpayer money to attract private companies. If none did the playing field would be level. New plants should be built with shareholder money, the people who benefit.
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Corey W. 7:41AM (4/27/2006)
"Under state trade rules, national and/or regional governments are banned from giving aid to a non state-owned entity if such arrangements upset EU competition rules."
Wow.... interesting!!!
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Joey (Kev) 7:43AM (4/27/2006)
6 million doesn't seem much but if they were allowed to get along with it France would hand out 6 billion to Renault as soon as the next crisis arrives and away with competition.
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Sgt. Hulka 8:56AM (4/27/2006)
Reason# 7,6455 as to why Europe and the EU are going to Hell-in-a-handbasket.
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Toyota LoverUK 9:34AM (4/27/2006)
Joey/Kev,
The ruling only applies to NON-state owned companies. the French government own about 16% of Renault so they can give as much of French taxpayers money as they want. Otherwise, Renault would have tanked years ago!
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Bruno V 4:43PM (4/27/2006)
What strikes me as interesting in this article is the fact that the European Union is sceptical of the planned use of the funds. Belgians consider tax evasion a national passtime (I used to actively participate, until moving to the US), and it seems the EU administrators are catching on to our diceiving ways.
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Joey (Kev) 3:47AM (4/28/2006)
#6
no, it does apply to ALL companies. State can't even take part when new shares of a partly state-owned company are issued without Brussels looking at it. If it has an impact on the market it won't be accepted.
There have been cases that seem to prove the opposite (Alitalia, Alstom, Bank Berlin) but the EU always managed to get some compromise.
#5
I guess you don't understand what the news means. For Europe it is a GOOD thing that states don't distort competition with tax-payers money. Specially Britain should be happy because they seldom did when they could but their companies suffered from the distortions elsewhere.
The only problem is when countries outside the EU distort competition (Boeing-Airbus). But that is not the EU's fault.
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