EU investigates FSO
Commission chiefs said Polish government plans to give Fabryka Samochodów Osobowych (FSO), a former subsidiary of South Korea's Daewoo Motors, some ?135 (zł.554) million in aid could be incompatible with EU competition rules.
"In particular, [the Commission] has doubts that the measures of the restructuring plan are actually capable of restoring the long-term viability of the firm within a reasonable timescale," the Commission said in a statement.
Under EU rules, the state may invest in a company if a private investor would behave in the same way. In certain circumstances, aid is allowed in economically distressed areas.
FSO, Poland's flagship carmaker before 1989, was sold to Daewoo Motors in the mid-1990s. It was later left out of a deal under which U.S. General Motors took over the bankrupt Korean company's operations.
Poland's government is in talks with Ukraine's automaker AvtoZAZ on selling it a 20 percent state-owned stake of FSO. The remaining stake is in the hands of a Daewoo trustee and the carmaker's creditor banks.
The Commission asked the Polish government for more information about FSO's restructuring program and invited the firm's competitors to comment on the matter.
FSO's main competitors are Fiat and Opel, a subsidiary of General Motors, both of which have factories in Poland. (Reuters)
J.T.
"In particular, [the Commission] has doubts that the measures of the restructuring plan are actually capable of restoring the long-term viability of the firm within a reasonable timescale," the Commission said in a statement.
Under EU rules, the state may invest in a company if a private investor would behave in the same way. In certain circumstances, aid is allowed in economically distressed areas.
FSO, Poland's flagship carmaker before 1989, was sold to Daewoo Motors in the mid-1990s. It was later left out of a deal under which U.S. General Motors took over the bankrupt Korean company's operations.
Poland's government is in talks with Ukraine's automaker AvtoZAZ on selling it a 20 percent state-owned stake of FSO. The remaining stake is in the hands of a Daewoo trustee and the carmaker's creditor banks.
The Commission asked the Polish government for more information about FSO's restructuring program and invited the firm's competitors to comment on the matter.
FSO's main competitors are Fiat and Opel, a subsidiary of General Motors, both of which have factories in Poland. (Reuters)
J.T.
