Sat, 10:37 26 Apr 2008 GMT17

 

EU urges Poland to file reform plans for shipyards
29 Feb 2008 13:48:59 GMT
Source: Reuters
BRUSSELS, Feb 29 (Reuters) - The European Commission has urged Poland to meet Friday's deadline for the submission of restructuring plans at struggling state-controlled shipyards suspected of receiving illegal state aid.

Poland must also not agree rescue plans with prospective investors in the yards -- Gdansk, Gdynia and Szczecin, where anti-Communist movement Solidarity was born in 1980 -- over the Commission's head, the European Union executive said.

"We want to emphasise it would be extremely disappointing for the Commission if we were presented with a fait accompli," Commission spokesman Jonathan Todd told a daily news briefing.

"We do not expect the restructuring plans to be finalised ... without our involvement."

Officials say the Commission is impatient with Poland for dragging its feet over the plans, which could provide the basis for Brussels regulators to declare whether state aid for the yards is legal.

Because of the state aid, the Commission is demanding unspecified output cuts from the shipyards.

"We consider there has been ample time for the preparation of these restructuring plans. We have been very co-operative and understanding," Todd said.

He declined to say how much the Commission believed Poland had granted to the shipyards in aid, but some estimates put it at hundreds of millions of euros.

Unless the Commission accepts the restructuring plans, it may order the yards to repay state aid deemed illegal even after their privatisation.

Under EU rules, governments can give financial help to ailing companies only if the cash is accompanied by plans that would make the firms viable in the long term.

Industrial Donbass Union, one of Ukraine's biggest financial and industrial groups, has agreed to pay $400 million for the Gdansk shipyard.

Polish newspapers have reported future investors are not willing to see the yard's production capacity slashed or to repay state aid.

(Editing by David Hulmes)
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Ukraine's President Viktor Yushchenko takes part in commemoration ceremonies for Chernobyl victims in Kiev April 26, 2008. REUTERS/Vladimir Sindeyev (UKRAINE) ...



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