EUROPEAN COMMISSION
PUBLIC VERSION
This document is made available for
information purposes only.
Brussels, 18.09.2013
C(2013) 5824 final
Subject:
State aid SA.36953 (2013/N) –– Spain
Investment Aid to the Port of Bahía de Cádiz
Sir,
1.
(1)
2.
2.1.
(2)
1
PROCEDURE
By SANI notification of 2 July 2013, Spain notified an ERDF grant for a port
infrastructure investment project at the Port of Bahía de Cádiz. The project had
been pre-notified on 4 June 2013 (SA.36776 (2013/PN) – Spain - Investment
aid to the Port of Bahía de Cádiz). The Commission had requested additional
information by e-mails of 7, 11 and 12 of June 2013, which was provided by
the Spanish authorities via e-mails of 10, 12 and 17 of June 2013.
DESCRIPTION
The objective of the notified project
The port of Bahía de Cádiz (hereinafter "the PBC") is located within the
perimeter of the city of Cádiz, in the Southern part of Andalucía, which is a
region assisted under Article 107(3)(a) of the Treaty during the period 20072013. 1 The PBC is administrated by the Port Authority of the Bahía de Cadiz
(hereinafter "the PABC"), which is a public entity under Spanish law (see
recital (13) below).
See Commission Decision of 20.12.2006 on State Aid N626/2006 - Spain - National regional state
aid map 1.1.2007 – 31.12.2013, Summary published in OJ C 35 of 17.02.2007. The full text of the
Decision
(authentic
language
English
translation)
is
available
at
http://ec.europa.eu/competition/state_aid/register/ii/doc/N-626-2006-WLWL-en-20.12.2006.pdf.
1
(3)
The PBC currently holds one terminal (Reina Sofía), which is used for both
freight and passengers transport. The current freight transport capacity is of
159 950 TEU/year. 2 In 2011 the terminal received around 378 000 passengers.
(4)
The objective of the investment project is to construct a new freight terminal
on the perimeter of the PBC. This will allow the PBC to de-congest the traffic
in the current terminal by removing the freight traffic. In the future the old
terminal shall be used exclusively for receiving cruise and other passenger
ships. The new terminal will also allow PBC to receive larger container ships the current terminal can harbour ships with a depth up to 10,5 m, while the
new terminal will have the capacity to receive ships with a depth up to 13 m.
(5)
With this investment project, the PBC shall increase its freight transport
capacity to 371 000 TEU/year as of 2016 onwards. The PBC also estimates to
be able to receive up to 596 000 passengers/year by 2040 (which would
correspond to a 58% increase of the passenger traffic from 2016 to 2040).
(6)
The Spanish authorities have planned the required road and railway
connections of the port for handling adequately the expected increases in
freight and passengers flows.
2.2.
(7)
Planned investments
The projects involves mainly the construction of a new container terminal:
- one dock (muelle) of 589.50 m length and 16 m depth;
- a near-by yard of 22 hectares;
- one breakwater of 305,25 m length;
- one closing speck (mota de cierre) of 290 m length; and
- access road connexion of 1289,50 m ( including an underground tunnel of
890m) connecting the new terminal directly to the bridge giving access to the
highway;
- installations for the supply of water, electricity, telecommunications, etc.
- dredging a total volume of 4.36 million sqm.
The new container terminal shall be built within the perimeter of the PBC,
occupying partially a piece of land that was previously rented to the
NAVANTIA shipyards. The underground access tunnel shall be built
underneath the port surface, to connect the new terminal directly to the
roundabout access point towards the new bridge La Pepa, which is currently
constructed over the bay to connect the city directly to the highway to Sevilla.
2
The term ‘TEU’ stands for Twenty-Foot Equivalent Unit, which is a standardized measure of a ship’s
cargo-carrying capacity. The dimensions of one TEU are equal to that of a standard 20′ shipping
container. Large container ships can carry above 14 000 TEU.
2
The construction works for the La Pepa bridge should be concluded in
October 2014. 3
(8)
The breakdown of the investment costs for the new container terminal is as
follows:
Project Part
Investment Costs (EUR)
Breakwater (dique de abrigo)
12.497.000
Dredging
21.176.000
Dock (muelle de atraque)
26.817.500
Yard (explanado de terreno)
10.320.000
Closing speck (mota de cierre)
3.702.600
Various other construction works
3.876.4000
Access tunnel
24.500.000
Utility installations
3.000.000
Technical assistance
2.529.500
Total
108.419.500
(9)
In addition to the above works related to the construction of the new container
terminal, the investment project also foresees EUR 1 million of refurbishment
for the maritime cruise ships station, and EUR 17.53 million for refurbishment
of existing port facilities. This would lead to a total cost of the project of
EUR124.111.059, which is however reduced to EUR 118.538.000 (VAT and
reserves excluded) by deducting EUR 8.413.300, which is the value of the
land with a total surface of 9.8 hectares liberated in the old terminal. This
value was calculated in 2012 based on the evaluation of the land within the
perimeter of the PBC at the price of EUR 85.85/sqm.
(10)
The investment costs associated with the superstructures necessary for the
operation of the new container terminal shall not be financed by the PCB
under this project. The PBC shall organise a public, open and nondiscriminatory tender for the selection of a terminal operator, in accordance
with EU public procurement law. 4 The terminal operator selected through this
3
4
See http://es.wikipedia.org/wiki/Puente_de_La_Pepa.
See in particular Directive 2004/17/EC of the European Parliament and of the Council of 31 March
2004 coordinating the procurement procedures of entities operating in the water, energy, transport
and postal services sectors, OJ L 134 of 30.4.2004, p. 1-; and Directive 2004/18/EC of the European
Parliament and of the Council of 31 March 2004 on the coordination of procedures for the award of
public works contracts, public supply contracts and public service contracts, OJ L 134 of 30.4.2004,
p. 114-.
3
procedure shall pay himself the costs associated with paving the yard, the
acquisition of the cranes and other machinery for the handling of containers,
and the other installations (e.g. offices, maintenance and repair workshop,
supply of electricity, lightening, etc.). It is estimated that the future terminal
operator will make thus an initial investment of approx. EUR 39.033.394.
2.3.
Financing of the investment project
(11)
As indicated in recital (8) above, the total costs of the investment project is
EUR 118.538.678. Spain requested from the European Regional Development
Fund (ERDF) a co-financing of EUR 60.06 million. The remaining part of
EUR 58.478.678 will be provided by PBC on market terms: partly from a
EUR 60 million loan taken by the PBC from the European Investment Bank
(EIB) without State support (the contract for this loan was signed on 22
September 2011), and partly from revenues obtained by PBC from its
commercial activities.
(12)
The Spanish authorities provided a financial and economic cost/benefit
analysis for this investment project, and an analysis based on the funding gap
method. Over a reference period of 29 years (2011-2040), the project has a
negative financial net present value (NPV) of – EUR 67.740.442 and a
financial rate of return of -2.02%. The negative NPV and negative rate of
return indicate that the project is not financially-sustainable without public
support.
2.4.
The beneficiary: the Port Authority of Bahía de Cádiz ("PABC")
(13)
The infrastructures resulting from the project shall be property of the PABC, 5
who administrates the Port of Bahía de Cádiz, which is classified as 'State port
of general interest' by the Spanish framework Law on State ports and the
merchant navy (Ley de Puertos del Estado y de la Marina Mercante –
hereinafter "LEPEYMM"). 6 The PABC is one of the 28 port authorities which
administrate the 46 public ports of general interest in Spain (see also below). 7
(14)
Under Law No. 48/2003, 8 which defines the economic regime and the services
provided by the Spanish ports classified as 'ports of general interest' (puertos
5
Further information on the Port of Bahia de Cadiz and the PABC is available at
http://www.puertocadiz.com/opencms/PuertoCadiz/es/.
6
Real Decreto Legislativo 2/2011, de 5 de septiembre, por el que se aprueba el Texto Refundido de la
Ley de Puertos del Estado y de la Marina Mercante, Boletín Oficial del Estado (hereinafter "BOE"),
núm. 253 de 20 de octubre de 2011, pages 109456 to 109710. See Article 4 on ports of general
interest, and Annex I to the Law, listing them.
7
See http://www.puertos.es/sistema_portuario/presentacion.html.
8
Ley 48/2003, de 26 de noviembre, de régimen económico y de prestación de servicios de los
puertos de interés general – BOE núm. 284 de 27 de noviembre de 2003, as modified by Ley
33/2010, de 5 de agosto, de modificación de la Ley 48/2003, de 26 de noviembre, de régimen
económico y de prestación de servicios en los puertos de interés general – BOE núm. 121 del 7 de
agosto de 2010.
4
de interés general), the infrastructures and spaces within the perimeter of such
ports are within the public domain, and shall be administrated by the Port
Authorities. Port operations, the services rendered, safety and coordination are
within the attributions of the Port Authorities. According to the law, the latter
may either provide port services themselves, or entrust them to
operators/service providers. In this case, the PABC shall rent the new
container terminal at the Port of Bahía de Cádiz to an operator/service
provider selected via public tender, as indicated in recital (9).
2.5.
(15)
2.6.
Chronology of the project
The first viability study for the project was made in November 2006. The
analysis of the environmental impact of the project was initiated in July 2008,
and the project was approved by Resolution of the Spanish State Secretariat
for Climate Change of 13 October 2010. 9 Spain submitted an application to
obtain co-financing from the ERDF for this project on 15 July 2011 10 and
revised application on 11 April 2012. The PABC organised a public tender for
the selection of the operated to be entrusted with the construction works. The
contract works were adjudicated on 28 September 2011 to NTC Cádiz UTE.
The contract was signed on 19 October 2011, and the works initiated in
November 2011.
Competition context
(16)
According to the Spanish authorities, the new port infrastructures to be
acquired by the PABC shall not result in a substantial distortion of competition
at European and international level.
(17)
On the one hand, this project shall add new capacities to the already existent
ones in Spain and in the EU in terms of containers traffic. As indicated in
recitals (4)-(5), with the new container terminal the PBC shall increase its
freight transport capacity from the current 159 950 TEU/year to 371 000
TEU/year as of 2016. The decongestion of the current terminal will also allow
an increase of the passenger transport: PBC estimates to be able to receive up
to 596 000 passengers per year by 2040. This would correspond to a 58%
increase of the passenger traffic from 2016 to 2040.
(18)
The Port of Bahía de Cádiz is a gateway type of sea port, meaning that it is
mainly destined for serving the export/import of merchandise for the
hinterland, which comprises principally the Western part of the region of
Andalucía, Extremadura, and to a lesser extent the rest of the peninsula. This
port is not oriented towards transhipment, and therefore it does not compete
directly with the large hub ports like Algeciras, Tanger-Med and Valencia.
9
Published in B.O.E. of 3/11/2010.
Project no 2011ES161PR007.
10
5
(19)
The Spanish authorities also underline that the main area of influence of a port
of the characteristics of the one in Cádiz is 300-500 km. Within this reach, the
main ports with which the PABC could potentially compete are the inland port
of Sevilla (Spain), the near-by sea port of Bahía de Algeciras (Spain), and the
Portuguese port of Sines, which is located at a distance of approximately 400
kms by sea from Cádiz. The new container terminal of the Port of Cádiz is
destined for receiving the new generation type of panamax container carriers,
with a depth of up to 13 m, which cannot be hosted by the inland port of
Sevilla because the maximum depth available there is of 7 m. The Portuguese
Port of Sines, which is administrated by the Port Authority of Singapore, has a
much larger capacity, i.e. of 550 000 TEU/year. According to the Spanish
authorities, the Port of Sines is mainly utilised by MSC as a complementary
hub to Valencia. MSC is also the main current client of the Port of Cádiz, but
for a different kind of freight traffic, destined to serve the hinterland.
Similarly, the Port of Algeciras is mainly a hub.
(20)
The Spanish authorities estimated demand for container transport and
passenger traffic at the Port of Bahía de Cádiz in order to establish that the
project meets realistic expectations of increase of the demand. The initial
viability estimates were done in 2006, but were revised in 2011 and 2012. The
PABC estimates that the new container terminal shall reach maximum
utilization of the capacity of 371 00 TEU/year in 2030 - with a delay of 5
years by comparison to the original previsions due to the effects of the crisis. It
is estimated that in the medium term the demand for container traffic at this
port will increase by 8%. Regarding the evolution of passenger traffic, the
PABC underlines that demand already exceeded the existent capacities in
2011, and the number of passengers hosted by the port is estimated to grow by
58% between 2016 to 2040.
2.7.
(21)
2.8.
(22)
2.9.
(23)
11
Legal basis
The legal basis for the ERDF grant of EUR 60.06 million to co-finance this
project is Council Regulation 1083/2006. 11
Form and duration of the aid
As indicated in recital (11) above, the public funding for this project takes the
form of a direct grant from the ERDF. The aid shall be disbursed until the end
of 2015, when the construction works are scheduled to be concluded.
Cumulation
The Spanish authorities commit that aid received for this project cannot be
cumulated with aid received from other local, national or EU sources for the
same eligible costs.
Council Regulation (EC) No 1083/2006 of 11 July 2006 laying down general provisions on the
European Regional Development Fund, the European Social Fund and the Cohesion Fund and
repealing Regulation (EC) No 1260/1999, OJ L 210 of 31.7.2006, pp. 25-78.
6
3.
3.1.
ASSESSMENT
Existence of aid
(24)
Article 107(1) TFEU stipulates that any aid granted by a Member State or
through state resources in any form whatsoever, which distorts or threatens to
distort competition by favouring certain undertakings or the production of
certain goods and affects trade among Member States is incompatible with the
internal market.
(25)
It follows that, for a state measure to be qualified as state aid within the
meaning of Article 107(1) TFEU, the following cumulative criteria must be
met: use of state resources; selective advantage to the beneficiary; and
(potential) distorting effects on competition as well as intra-EU trade.
Considering that the public support for this project is mainly benefitting to the
PABC, which according to Spanish law is a public entity (see recitals (12)(13) above), it should also be examined whether the PABC engages with this
project in an economic activity and therefore qualifies as an undertaking for
the purposes of the assessment of the public financing in support of this
investment project.
(26)
In the present case, the existence of state aid must be examined at the level of:
the PBCT, who will administrate the public-owned infrastructures resulting
from this project; the future port services provider – the concessionaire of the
new container terminal; and of the port business end-users (shipping and
transport companies).
3.1.1. Existence of aid at the level of the PABC
3.1.1.1.
Notion of undertaking
(27)
Pursuant to Spanish law applicable to ports of general interest (see recitals
(12)-(13) above), the port authorities of ports classified as such are public
entities established for the purpose of administrating the port infrastructures,
which are public-owned. The port authorities may either provide themselves
the port services, or rent the port infrastructure to other service providers on
the basis of administrative concession contracts.
(28)
According to established Court jurisprudence, 12 whenever an entity is engaged
in an economic activity, regardless of its legal status and the way in which it is
financed, it constitutes an undertaking for the purposes of EU competition law.
The Leipzig-Halle judgment 13 clarified that it is the future use of the
12
See e.g. Case C-41/90 Hofner and Elsner [1991] ECR I-1979, para. 21; C-160/91 Poucet and Pistre
v. AGF and Cancava [1993] ECR I-637, para. 17; Case C-35/96 Commission v. Italy [1998] ECR I3851.
13
Joined cases T-455/08 Flughhafen Leipzig-Halle GmbH and Mitteldeutsche Flughafen AG v.
Commission and T—443/08 Feistaat Sachsen and Land Sachsen Anhalt v. Commission [2011] ECR
II-0000 see also Case T-128/89 Aéroports de Paris v. Commission [2000] ECR II-3929, confirmed
by the ECJ, Case C-82/01P [2002] ECR I-9297, and Case T-196/04 Ryanair v. Commission [2008]
ECR II-3643, paragraph 88.
7
infrastructure, i.e. whether the infrastructure shall be commercially exploited
or not, which determines whether construction of such infrastructure is an
economic activity and accordingly whether the funding of the construction of
such infrastructure falls within the scope of EU state aid rules or not. Also the
Commission established in a series of decisions that the construction and
exploitation of some types of infrastructure constitutes an economic activity. 14
(29)
The notified project concerns the construction of a port infrastructure that, as
explained in recitals (8)-(9) above, shall be commercially-exploited by the
PABC through its rental/concession. The concessionaire will further provide
the services of the ports on the market against remuneration. Therefore, PABC
will engage in an economic activity, and it is therefore considered to be an
undertaking for the purposes of the present decision.
3.1.1.2.
State resources and imputability
(30)
As indicated in recital (10) above, Spain requested an EU co-financing of EUR
60.06 million for this project. The EU resources (ERDF funds) that shall be
made available for co-financing this project are placed at the disposal of the
Spanish authorities, and therefore amount to State resources.
(31)
As regards imputability to the State of the public financing, it is noted that the
Spanish authorities enjoy a high degree of control in the selection at national
level of the projects of this nature to be financed. The notified project was
directly chosen by the Spanish State. Therefore, the notified measure is
imputable to the State.
3.1.1.3.
(32)
Selectivity
As the public financing is granted specifically to the PABC, the measure is
selective.
3.1.1.4.
Economic advantage for PABC
(33)
In order to establish whether the public resources granted to the PABC provide
it with an economic advantage, the Commission first observes that the public
funding requested for this project takes the form of a direct grant from the
European Regional Development Fund ('ERDF'). The award of public funds to
support an investment project unquestionably confers an advantage to the
beneficiary of the project, the PABC.
(34)
This is furthermore the case when it is unlikely that the part of the investment
costs covered by the ERDF grant could not have been financed by the PABC
on market terms. This is unlikely to happen in cases where the investment
14
See e.g. Commission Decision of 15.12.2009 in State Aid case no. N 385/2009 – Public financing of
port infrastructure in Ventspils Port, OJ C 72 of 20.03.2010; Commission Decision in State aid case
no. 44/2010 Public financing of port infrastructure in Krievu Sala – Latvian Republic, OJ C 215 of
21.7.2011, p. 19; Commission Decision on State aid case no. SA.30742 (N/2010) - Lithuania –
Construction of infrastructure for the passenger and cargo ferries terminal in Klaipeda, OJ C 121 of
26.4.2012, p. 1.
8
project does not yield an acceptable rate of return over a reasonable reference
period of time. The financial assessment of the project is relevant in this
respect. The Commission's Guide to the cost-benefit analysis of investment
projects 15 ("the Guide") places particular emphasis on two financial indicators
to evaluate the financial sustainability of the investment, i.e. the financial net
present value (FNPV) and the financial internal rate of return (FRR). These
indicators measure the present (discounted) amount of the inflow of net
benefits generated by the investment, and respectively, the capacity of the net
revenues to remunerate the investment cost.
(35)
In this case, the financial data shows a negative value of the FNPV, i.e. the
expected revenues do not cover the investment costs of the project. The FRR
is also notably low (see recital (11) above). Given the results of the financial
analysis provided by the Spanish authorities, it must be concluded that the
investment would not have been undertaken by a private investor. Therefore,
in the light of the above, and of the fact that the Spanish authorities do not
claim that the market investor test is met, it must be concluded that in this case
the public funding is not given on terms that would have been acceptable to a
private investor, and the measure therefore confers an economic advantage to
the PABC.
3.1.1.5.
(36)
Conclusions on the existence of aid at the level of the PABC
In the light of the findings in recitals (27)-(35) above, the Commission
concludes that the ERDF financing requested by Spain in relation to this
investment project involves state aid within the meaning of Article 107(1)
TFEU. Insofar as the aid was notified by the Spanish authorities and will be
granted only after authorization by the Commission, the aid is legal.
3.1.1.6.
Distortion of competition and affectation of trade
(37)
According to an established case law, when the financial support granted by a
Member State strengthens the position of an undertaking compared to other
undertakings competing in intra-Union trade, than there is at least a potential
effect on trade between Member States and competition. 16
(38)
As indicated in recitals (5) and (16) above, with this investment project the
PABC shall add new freight transport capacity on the market, and it shall
improve its capacity of receiving cruise ships/passengers. The newly-created
transport capacity shall affect both competition and intra-Union trade, because
PABC is, given its location, at least potentially in direct competition for
container transport with the ports of Algeciras (Spain) and Sines (Portugal).
3.1.2. Existence of aid at the level of the future concessionaire
15
16
See http://ec.europa.eu/regional_policy/sources/docgener/guides/cost/guide02_en.pdf.
See e.g. Case 730/79 Philip Morris v. Commission [1980] ECR 2671, para. 11, and Case C-372/97
Italy v. Commission [2004] ECR I-3679, para. 44.
9
(39)
The concession contract for the operation of the new container terminal shall
be concluded on the basis of a public, open and non-conditional tender, in
compliance with EU public procurement law – see recital (9) above.
(40)
The above-described administrative contracting procedures shall observe
transparency and non-discrimination criteria, and the economically-mostadvantageous offers shall be chosen. Therefore, assuring that the tendering
procedure will comply with those criteria, it will exclude or minimise the
economic advantage in favour of the future concessionaire (i.e. the advantage,
if any, will be the minimum necessary to ensure the actual operation of the
infrastructure).
3.1.3. Existence of aid at the level of port users
(41)
3.2.
With regard to the end users of the new infrastructure, the Commission
observes that they shall enjoy equal and non-discriminatory access to the new
infrastructure. Moreover, the future terminal operator will have to base its
pricing policy vis-à-vis end users on economic considerations, so as to obtain
sufficient revenues enabling it to pay for the concession fee and also make a
profit. The concession fee shall be established following public and open
tender, based on exclusively economic pricing criteria. In the light of these
elements, the potential advantage for the users, if any, will be the minimum
necessary to ensure the actual use of the infrastructure, while ensuring the
profitability of the concessionaire.
Compatibility of the aid
(42)
To the extent that the notified public financing amounts to State aid, it must
also be assessed if the aid is compatible with the Treaty.
(43)
According to established practice, 17 the appropriate legal basis for assessing
compatibility of the State aid to port investment projects is Article 107(3)(c) of
the Treaty, which stipulates that "aid to facilitate the development of certain
economic activities or of certain economic areas, where such aid does not
adversely affect trading conditions to an extent contrary to the common
interest" may be found compatible with the internal market.
(44)
It should therefore be examined if the notified public funding meets a clearlydefined objective of common interest, is necessary and proportional to this
objective, and does not affect competition and intra-EU trade to an extent
contrary to the common interest.
3.2.1. Objective of common interest
(45)
In the Communication entitled A Sustainable Future for Transport: Towards
an integrated, technology-led and user-friendly system, 18 the Commission
17
See Commission Decisions on State aid cases Ventspils Port, Krievu Sala and Klaipeda, as cited in
ftn. 11 above.
18
COM(2009) 279/4, paragraph 46.
10
underlined that the development of ports and intermodal terminals is key to
achieving an integrated and intelligent logistic system in the EU.
(46)
In the Communication to the European Parliament, the Council, the European
Economic and Social Committee and the Committee of the Regions on
Strategic Goals and Recommendations for the EU Maritime Transport Policy
until 2018, 19 the Commission underlines that providing new port
infrastructures, as well as improving the use of the existing capacities, is
essential to ensuring that EU ports can cope efficiently with their gateway
function.
(47)
In December 2011 the European Commission put forward a proposal for a
TEN-T Regulation. 20 According to this proposal, the TEN-T could be best
developed through a dual-layer approach, consisting of a comprehensive
network and a core network. The comprehensive network constitutes the basic
layer of the new TEN-T. It consists of all existing and planned infrastructure
meeting the requirements of the Guidelines. The comprehensive network is to
be in place by 31 December 2050 at the latest. The Port of Bahía de Cádiz is
one of the seaports included in the EU comprehensive network to be set in
place by 2050.
(48)
As indicated in recital (12) above, the PBC is one of the 46 public ports of
general interest in Spain. The project will allow de-congesting the traffic at the
current terminal, and it will facilitate the import/export of merchandise in this
part of Spain. The project is also expected to generate 1200 direct jobs and
2800 indirect jobs in the area. A study conducted by the Economic Department
University of Cádiz in 2008 21 has shown that the Port of Cádiz generates
between 3 and 4 jobs per thousand tons of merchandise transiting the port.
According to the same study, in 2006 the PBC accounted for 3.98% of the
employment in the province of Cádiz, and for 0.58% of the employment in the
region of Andalucía, at the same generating 4% of the gross added economic
value in the province of Cádiz and 0.61% in the region of Andalucía. The
employment effects of the project are important, considering that the province
of Cádiz had in April 2013 the highest unemployment rate in Spain, of
41.6%. 22 By supporting the import/export of merchandise for the hinterland of
the port, the project will have wider positive effects on the regional economy
in the Southern Spanish regions of Andalucía and Extremadura, which are
currently assisted under Article 107(3)(a) TFEU.
19
See Communication from the Commission to the European Parliament, the Council, the European
Economic and Social Committee and the Committee of the Regions: Strategic Goals and
Recommendations for the EU Maritime Transport Policy until 2018, COM (2009) 8.
20
See Proposal for a Regulation of the European Parliament and of the Council on Union guidelines
for the development of the trans-European transport network, COM(2011)650/2 of 19.11.2011, text
available at http://ec.europa.eu/transport/themes/infrastructure/connecting/doc/revision/legislativeact-ten-t-revision.pdf.
21
Evaluación del impacto económico del Puerto de la Bahía de Cádiz.
22
http://www.indecadiz.com/con-un-416-la-tasa-de-paro-en-cadiz-es-la-mas-alta-de-espana/.
11
(49)
The above elements indicate that the project contributes to an objective of
common EU interest and to the development of both an economic activity and
an economic area.
(50)
In addition, Spain provided documentation to the effect that the environmental
impact of this project has been assessed by the responsible Spanish authorities.
3.2.2. Necessity and proportionality of the aid
(51)
The project has a funding gap/negative NPV of – EUR 67.74 million over a
reference period of 29 years (2011-2040), which shows that the net revenues
to be derived over a period of 29 years do not remunerate the investment costs.
It is notable that, in spite of the very high negative present value (NPV) of the
investment project, the Spanish authorities requested public financing of EUR
60.06 million, which represents 50.70% of the total investment costs. The fact
that the aid amount requested is lower than the estimated funding gap is
possible because the PABC borrowed on market terms the sum of EUR 60
million (see recital (10) above), and will also contribute to the investment
costs from own revenues obtained from its economic activities. It is however
unlikely that the PABC would have been able to finance entirely on its own
the entire sum of EUR 118.538.678 necessary for the project. In addition, the
Commission has consistently considered that port infrastructure projects
require considerable capital investments that can only be recovered in the very
long term, and their economic viability may not normally be ensured without
public funding. 23
(52)
With respect to the incentive effect of the aid, the Commission notes first that
the works for this project were initiated after the application for aid. As noted
in recital (14) above, the Spanish authorities applied for ERDF co-funding for
this project on 15 July 2011. The contract for the construction works was
adjudicated following public tender on 28 September 2011, and the works
initiated in November 2011.
(53)
Furthermore, the negative NPV and FRR that were estimated for this project
indicate that the project is not viable over a reference period of 29 years
without public support. It should also be taken into account that the PABC
makes a notable effort to fund itself, without any kind of public support, EUR
58.478.678 from the total cost of EUR 118.538.678 of the project (see recital
(10) above). It is unlikely that the PABC would be able to obtain the
remaining EUR 58.478.678 on the market. Indeed, the principle of incentive
effect is that aid is necessary when it is unlikely that a given project could be
carried out in its absence. The Commission considers that, in the light of the
foregoing considerations, the requested aid is necessary for this project.
(54)
As regards proportionality (i.e. keeping public funding down to the minimum
necessary), it is first noted that the funding gap identified for this project is of
EUR 67.74 million, while the aid intensity proposed is of 50.70%. The
Commission notes that the aid intensities in port infrastructure investment
23
See the recent Commission Decisions on port infrastructure projects cited in ftn. 11 above.
12
cases are variable, each reflecting the particularities of the project in question.
In the recent Ventspils and Krievu Sala port cases 24 the aid intensity was of
50%, in the case of Klaipeda 25 of 65%, and in the case of Augusta 26 of 68.87%.
It is also note that the aid amount requested is below the estimated funding gap
of the project. It is therefore concluded that the aid is limited to what is
necessary in order to make the project feasible.
(55)
In addition, the fact that the design and constructions works for the project
were contracted following public, open and non-discriminatory tender (see
recital (14) above) is also a good indication that the public financing shall be
kept to the minimum necessary. It is also reminded in this context that the
PSCT shall contribute EUR 58.478.678 to the financing of this investment
project. In a similar way, the fact that the new infrastructure built with the
project shall be rented to a terminal operator following public, open and nonconditional selection procedures shall also ensure that the PABC shall
maximise the return on this investment.
(56)
In the light of the above, the Commission concludes that the aid is necessary
and proportional.
3.2.3. Distortion of competition and affectation of intra-EU trade
(57)
As indicated in recitals (4)-(5), with the new container terminal the PBC shall
increase its freight transport capacity from the current 159 950 TEU/year to
371 000 TEU/year as of 2016. The decongestion of the current terminal will
also allow an increase of the passenger transport: PBC estimates to be able to
receive up to 596 000 passengers/year by 2040, which would correspond to a
58% increase of the passenger traffic from 2016 to 2040.
(58)
However, having examined the arguments presented by the Spanish authorities
regarding the distortive effects of the project (see recitals (17)-(19) above), the
Commission considers that the project is not likely to affect EU trade and
competition to an extent that is contrary to the common interest. The PBC is a
gateway port geared for serving the hinterland (principally the Western part of
the region of Andalucía, Extremadura, and to a lesser extent the rest of the
peninsula). This port is not oriented towards transhipment, and therefore it
does not compete directly with the large hub ports like Algeciras, Tanger-Med
and Valencia. The main ports with which the PABC could potentially compete
are the inland port of Sevilla (Spain), the near-by sea port of Bahía de
Algeciras (Spain) and the Portuguese port of Sines, which is located at a
distance of approximately 400 kms by sea from Cádiz. However, the project at
the PBC is aimed at hosting container ships with a depth of up to 13 m, which
cannot currently be hosted by the inland port of Sevilla, where the maximum
depth available there is of 7 m. The project at the Port of Cádiz is aimed at
24
See ftn. 11 above.
See also ftn. 11 above.
26
Commission Decision on case SA.34940 Port of Augusta, 19 December 2012, published in OJ C 77
of 15.3.2013.
25
13
serving import/export for the hinterland in Andalucía and Extremadura,
whereas the Portuguese port of Sines is less well placed to serve the same
hinterland. The Port of Algeciras is mainly a transhipment hub.
(59)
The above elements allow concluding that the aid for this project does not
affect competition and intra-EU trade to an extent that would be contrary to
the common interest.
3.2.4. Conclusion
(60)
4.
On the basis of the foregoing findings (see recitals (40)-(57) above), the
Commission concludes that the aid totalling EUR 60.06 million is necessary to
address a well-defined objective of common interest, the advantage conferred
by the aid to the PABC and the other possible aid beneficiaries is not
disproportionate, and the aid does not affect competition and intra-EU trade to
an extent that would be contrary to the common interest. On these grounds, the
Commission concludes that the aid is compatible with the Treaty under Article
107(3)(c).
DECISION
(61)
The Commission has accordingly decided that the public financing totalling
EUR 60.06 for the works to construct a new container terminal at the Port of
Bahía de Cádiz constitutes State aid within the meaning of Article 107(1) of
the Treaty. The aid is however compatible with the Treaty under Article
107(3)(c) of the Treaty.
(62)
This Decision is without prejudice to any possible scrutiny under
environmental or Structural Funds rules. Similarly, the Decision does not
prejudge any possible further analysis by the Commission as far as compliance
with public procurement rules is concerned.
(63)
If this letter contains confidential information which should not be disclosed to
third parties, please inform the Commission within fifteen working days of the
date of receipt. If the Commission does not receive a reasoned request by that
deadline, you will be deemed to agree to the disclosure to third parties and to
the publication of the full text of the letter in the authentic language on the
Internet site http://ec.europa.eu/competition/elojade/isef/index.cfm.
Your request should be sent by registered letter or fax to:
European Commission
Directorate-General for Competition
State aid Greffe
1049 Brussels
Belgium
Fax No: +32 (0)2 2961242
14
Yours faithfully,
For the Commission
Joaquín ALMUNIA
Vice-president
15