State aid to the coal sector in the European Union – new challenges? Cover Image

Pomoc publiczna dla sektora górnictwa węgla w Unii Europejskiej – nowe wyzwania?
State aid to the coal sector in the European Union – new challenges?

Author(s): Piotr Podsiadło
Subject(s): Economy
Published by: Wydawnictwo Uniwersytetu Ekonomicznego we Wrocławiu
Keywords: REGIONAL POLICY; AGENCY THEORY; PRINCIPAL; PROXY/AGENT

Summary/Abstract: Coal was subject to a different regime under the ECSC Treaty, which lapsed on 23 July 2002. Generally, subsidies or aids granted by the Member States were recognized as incompatible with the common market for coal and steel and were accordingly prohibited by Article 4 CS. However, the Commission was empowered by Article 95 CS to authorise such state aid as it might consider necessary. The criterion of need was satisfied in particular where the sector concerned was in a state of exceptional crisis. Since the expiry of the ECSC Treaty, Council Regulation No 1407/2002 has determined the categories of aid to the coal industry that may be considered compatible with the proper functioning of the common market. The Council adopted this regulation trying to strike a balance between the need to maintain coal-producing capability to guarantee access to reserves, and the need to restructure the European coal industry. Regulation 1407/2002 was valid until 31 December 2010. The small contribution of subsidised coal to the overall energy mix no longer justifies the maintenance of such subsidies for securing the supply of energy in the Union. Council decision of 10 December 2010 on state aid to facilitate the closure of uncompetitive coal mines (2010/787/EU) marks the transition, for the coal sector, from the application of sector-specific rules to the application of general state aid rules which are applicable to all sectors. By 31 December 2027 Member States should be able to take measures to alleviate the social and regional consequences of the closure of mines, that is to say the orderly winding down of activities in the context of an irrevocable closure plan and the financing of exceptional costs, in particular inherited liabilities.

  • Issue Year: 2011
  • Issue No: 166
  • Page Range: 544-556
  • Page Count: 13
  • Language: Polish