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NEWS EXTRA
De Minimis Explained
years which can take various forms (grants, loans, subsidised contracts, etc). Aid given under an approved
scheme does not have to be cumulated with de minimis aid, provided any such de
minimis aid is not awarded towards the same eligible costs as those supported via that approved scheme.
Exclusions:
• De minimis aid cannot be given for export related activities (except attendance at trade fairs) or aid favouring domestic goods over imports.
• For undertakings active in the road freight transport sector, the de minimis ceiling is €100k
• De minimis aid cannot be awarded for the acquisition of road freight transport vehicles.
• De minimis aid cannot be used to top up awards made under approved State aid schemes, resulting in
a circumvention of the aid intensities set out in the rules attached to such schemes. In these cases it can only be awarded towards separate eligible costs.
The issue for the German retread sector was is that the industry had been able to access De Minimus funding and was able to use this to offset costs and competition from cheap Chinese imports. However, in December 2015 retreading was removed from the table of eligible industries and the De Minimus funding was lost.
For some retreaders, at a time of crisis, this loss is claimed to be sufficient to make the difference between closure and survival. The argument for De Minimus to be reapplied to retreading has been fought vigorously by retreaders such as Christian Stiebling and of course the BRV and the WDK, the later who see the loss of retreading as a potential cause of an increase in waste arisings.
The BRV took the case to the Federal Court and argued their opposition to the removal of De Minimis. However, the lead federal ministry of transport and digital infrastructure (BMVI) has now indicated that (the Federal Court) BRV proposal / application must be rejected on the basis of the rejection by the
Federal Ministry of Finance. Both new and used tyres are eligible for De Minimus, which are optimised in terms of noise and rolling resistance and show that they fall into energy classes AtoC.
Since retreaded tyres are currently excluded from the European legislation for tyre labelling; they are not acceptable under the criteria for De Minimis payments.
This was in the past, not a problem, but the Federal Court now sees no positive effects of retreading for the environment. Hans-Jürgen Drechsler, Managing Director of BRV commented. "Compared to new tyres, the manufacturing energy consumption is reduced by half and decreases the water consumption by 80 per cent. They need up to 70 per cent less crude oil, and there are on average 80 kg less raw materials used, "says Drechsler.
Moreover, he sees further discrimination: In future only tyres that can demonstrate an EU Tyre Label in terms of noise and rolling resistance will be eligible. That may exclude retreaded tyres because the EU had expressly excluded retreads from its application, the reason being that with a retread the carcass is assembled from pre- used tyres. Different manufacturers offer up to 8,000 different tyre combinations. If they were individually examined for the EU label, costs would rise to millions of euros.
If the Federal Court does not relent, then the future of 61 retreading companies in Germany with almost 2,000 employees will be under threat. Reifen Stiebling produces about 12,000 tyres annually, among other outlets, the company supplies public transport companies. Owner, Christian Stiebling, would like to build new and larger premises at a property in Dortmund that he has already bought. However, without a continuation of the De Minimis aid, these plans could become obsolete.
The German retread sector is stunned and angry at the removal of De Minimis aid from the retread sector. Now, unless you have delved into this, you may have no idea what De Minimus aid is. In fact, it is quite difficult to track down a plain English explanation of what De Minimis is in respect to business assistance. The following was extracted from the Scottish Government website:
De Minimis - What is it?
The European Commission considers that public funding to a single recipient of up
to €200,000 over a 3-year fiscal period has a negligible impact on trade and competition, and does not require notification.
This aid can be given for most purposes, including operating aid, and is not project-related. This is generally known as Industrial de minimis aid because of the economic sectors it supports. Separate rules apply to the Agriculture,
Fisheries and Road Transport sectors.
This does not mean that all funding under the €200,000 ceiling should be awarded as de minimis. It is strongly recommended to give even small amounts as aid under a specific approved scheme, or a block exemption, if possible, and to keep de minimis cover as a back-up for when there are no other options.
• The maximum de minimis funding any single recipient can receive
is €200,000 (cash grant equivalent) over a 3-year fiscal period. The sterling equivalent is calculated using the Commission exchange
rate applicable on the written date of offer of the de minimis funding.
• This ceiling takes into account all public
assistance given as de
minimis funding for the current and previous two fiscal