Steel Industry State Aid Examples.

Steel Sector State Support

EU state aid rules allow competitiveness enhancing support to viable steel companies but do not allow public aid to steel manufacturers in financial difficulties. Nor do they allow government support that gives a steelmaker an advantage over its competitors (although aid for environmental protection or research and development is normall allowed). Regional aid and support for plant closure are also prohibited in the steel sector. The table below lists some examples where government support was considered by the European Commission.

Notes

1. Aid to Irish Steel was equivalent to IEP 29 million. Calculation above assumes exchange rate of Euro 1.27 per Irish punt.
2. Legality of the debt relief given to the Mittal Steel Roman seamless tube plant (Petrotub) was subsequently questioned by the European Commission in 2007.
3. Kremikovtsi went bankrupt in August 2008. The Bulgarian government then initiated proceedings to recover the aid, as part of the liquidation proceedings.
4. Wallonia firms involved in the 2006-2011 government support included Duferco Clabecq, Duferco La Louviere and Carsid. This aid was subsequently declared to have been illegal.
5. Environmental support for ArcelorMittal Nova Hut in Ostrava in 2013 was for an upgrade of the sinter plant dedusting equipment. Distortion of competition because of this aid was expected to be limited.
6. Year 2015 government support to Ilva was subsequently challenged: the European Commission deemed that some of this aid had been illegal and in 2017 requested Ilva to repay €84 millon of interest subsidy.
7. Year 2022 rescue of Celsa Spain was dependent on creditor approvals (Goldman Sachs and Deutsche Bank).
8. 2023 Salzgitter support is for the firm's SALCOS project, involving investment in new electrolyser and DRI-based EAF.
9. Dunaferr went into liquidation in December 2022. Some questions appear to hang over the legality of state support given by the Hungarian government, to cover wage costs in early 2023. Some press reports also question whether recent ETS-related fines of around €600m should have been waived by the Hungarian Government.
10. Aid for USSK's decarbonisation project is to be provided under the European Union's Recovery and Resilience Plan.
11. Condemnation arose of the 2023 aid for SIJ Group subsidiaries in Slovenia arose, when it transpired that the parent company had approved a dividend of Euro €5.8m.
12. Year 2023 undertaking from the UK Government to Tata Steel was to grant up to GBP 500 million for the transition of Port Talbot in South Wales to low carbon steelmaking. Total project cost was estimated at GBP 1.25 billion.

For short overview of the rules concerning public aid for the steel sector, see presentation from DG Competiiton.