EU forces court action over £1m state aid handed out to first-time fishermen
By NEIL RIDDELL
THE EUROPEAN Commission has been accused of double standards after it lodged a strong defence of its decision to force the council to claw back around £1m paid out to first-time fishermen over the past decade.
EU fishing commissioner Joe Borg this week announced proposals for a 600m Euros aid package to held fishermen deal with the fuel crisis and SIC convener Sandy Cluness accused the commission of double standards. He said it was ironic that, at a time when people are dashing around trying to find ways of helping fishermen with the spiralling cost of fuel, Europe was trying to prevent the council from helping start-ups within the local industry.
Mr Cluness this week called on the UK government to step up efforts to help persuade the commission to drop the case. The council does not want the money to be returned and has launched an appeal – which could cost it up to £250,000 – against the ruling.
Senior council officials had hoped that the application of de minimis rules, under which payments of around £24,000 can be dished out in aid to companies in the fishing industry over a three-year period, would mean the council would not have to recover payments made to 78 first-time fishermen in the past 13 years.
But the commission has now confirmed that de minimis will not apply, meaning the council’s appeal – on the basis that there was a “legitimate expectation” that the payments complied with the rules – will now go ahead.
In March it was confirmed that the application of de minimis meant the council would not have to recover payments up to £7,000 to 20 crews under the Fishing Vessel Modernisation Scheme, though it will almost certainly have to recover £100,062, including compound interest, on a grant paid to the Shetland Fish
Products fishmeal factory in Bressay. The council intends to keep that sum in a special fund until its appeal against the commission’s ruling is heard by the European Court of Justice, which is not expected to happen until sometime in 2009, though it is understood the chances of a favourable ruling on the factory payment is unlikely.
The convener this week wrote to DEFRA minister Jonathan Shaw, who pledged in January this year to fight the council’s case, asking him to provide “further commitment” in pursuing the case with the commission.
A DEFRA spokesman this week denied the suggestion that the department, having agreed to back the council, was essentially sitting on its hands and said it was doing everything it could to help, adding that Mr Shaw would be replying to Mr Cluness very shortly.
“We sympathise with the fishermen and we’re doing all we can to help in this case, but it’s with the commission and we have to wait for their decision,” the spokesman said.
A European Commission spokeswoman said: “At this point in time, the commission is defending its case in court and, since legal procedures are ongoing, we would have no comment to make at this time on this specific case.”
A host of state aid complaints have been submitted from Shetland regarding various areas of the council’s activity, most recently over its involvement in the cinema and music venue Mareel. But Mr Cluness said he felt it was “perfectly legitimate” for the council to help provide such a centre. “Councils throughout the UK do this kind of thing,” he said. “It’s part of the task as far as I’m concerned.”