EU Commission confirms investment supplements for Propapier PM2 GmbH

Oct 02, 2014. /Lesprom Network/. The European Commission confirmed that the investment supplements for Propapier PM2 GmbH and the infrastructure measures in the Spree industrial region (Eisenhüttenstadt, Germany) are in conformity with European law. Propapier is relieved to hear of this outcome in the proceedings, as the company said in the press release received by Lesprom Network.

CEO Jürgen Heindl explains: "We have been entirely confirmed in our interpretation of the law by the European Commission. We were convinced of the legitimacy of the measures from the start. The very long proceedings bound capacities that are now once again free for our business activity."

The European Commission had in April 2008 authorised German authorities to fund a new plant for corrugated board base paper in Eisenhüttenstadt in the form of investment supplements amounting to approx. Euro 43.4 million. The Federal State of Brandenburg provided the funding. Propapier, a subsidiary company of Progroup AG, has been producing corrugated board base paper from recycled paper since March 2010 in the new paper factory in Eisenhüttenstadt.

The re-examination of the funding was necessary because a competitor filed a suit against the approval decision with the European Court in Luxembourg. The court reversed the approval for formal reasons.

With its decision, the European Commission confirmed that the investment supplements for the corrugated board base paper plant of Propapier PM2 GmbH are in conformity with European state aid law. It entirely confirmed the legal interpretation of Germany and of Propapier PM2 GmbH.

The European Commission also decided in other proceedings that the infrastructure measures at the Eisenhüttenstadt location do not involve state aid elements. Both the construction of a waste water treatment plant by the Trinkwasser- und Abwasserzweckverband Oderaue (TAZV) and the building of parking spaces and a road connecting with the B 112, as well as the expansion and deepening of the Oder-Spree Canal are infrastructure measures benefiting the general public.

The European Commission determined that no dedicated infrastructure benefiting one user exists. The fees for treatment of waste water in the TAZV plant also do not involve state aid. The fees transfer the costs for the construction and operation of the waste water treatment plant to its users.

Propapier is a large enterprise belonging to Progroup AG, which is active in the production and sale of corrugated case material and corrugated board. The newly built paper plant in Eisenhüttenstadt produces two types of corrugated case material, namely testliner and fluting made from recycled fibre.