The Office considers state aid for Hyundai compatible with EC rules

23 Oct 2006

The Office for the Protection of Competition has recently reffered a planned state aid measure of Czech government that intends to support the construction of a car plant of South Korean company Hyundai in north Moravia to the European Commission.

The Office considers the state aid to be compatible with EC rules on state aid up to the ammount of 15% of eligible costs. However, only the European Commission has the decision-making power in this issue.

UOHS deputy chairman Kamil Rudolecky said that the company Hyunday could be exempted from the general prohibition of state aid and could receive so-called regional aid.

According to a contract signed with the Czech Republic, Hyundai can get a subsidy worth up to 2.4bn CZK from the state budget for the plant's construction in the years 2007 – 2013.

The car maker and its fifteen sub-contractors may get a further 2.5bn CZK by 2011 for the creation of jobs and staff retraining.

Press and personnel department