27. 10. 84 Official Journal of the European Communities No L 283/45 COMMISSION DECISION of 23 July 1984 concerning assistance by the United Kingdom Government to a manufacturer of polyester yarn (Only the English text is authentic) (84/509/EEC) THE COMMISSION OF THE EUROPEAN COMMUNITIES, Having regard to the Treaty eétablishing the European Economic Community, and in particular the first subparagraph of Article 93 (2) thereof, Having given notice to the parties concerned to submit their comments as provided for in the said Article, and having regard to those comments, Whereas : By letter dated 30 January 1984, the United Kingdom Government notified the Commission of aid for the establishment of a new production unit for partially oriented polyester yarn (POY) at Stanley, Co. Durham. The relevant decision had been taken in 1982 and the major part of the assistance had already been paid. The yarn manufactured was intended to supply a UK processing company which had difficulty in obtaining supplies of this product on the markets of the Member States. The assistance to be granted totals £ 171400: € 420000 in the form of a selective grant under Section 7 of the Industry Act 1972, £ 158 400 in the form of a training grant under Section 7 of the Indus- trial Development Act 1982 and £ 593000 in the form of a Regional Development Grant under Part II of the Industrial Development Act 1982. Aid payments of £ 931400 have already been made towards the investment costs of approximately £ 4900 000. Before the notification was made, the Commission, acting on a complaint from a trade asso- ciation, reminded the United Kingdom Government by letter dated 5 December 1983 of its obligations pursuant to the rules on aids to the man-made yarns and fibres industry introduced in 1977 and extended in 1979, 1981 and 1983, which aim to prevent the grant of assistance for the establishment of new capa- city in an industry suffering from overcapacity and provide for prior notification of all types of assistance to the industry. On 29 February 1984 the Commission initiated the procedure under the first subparagraph of Article 93 (2) of the EEC Treaty in respect of this aid and, by letter dated 8 March 1984, gave formal notice to the United Kingdom Government to submit its comments. 11 Submitting its comments to the Commission under the Article 93 (2) procedure by letter dated 18 April 1984, the United Kingdom Government argued that yarn of the quality produced by the assisted company was not available on the European market in 1981/82 and that UK processors had to import such yarn from third countries like Mexico, Taiwan and the United States. It also stated that the aid had led to the creation of 60 jobs in the recipient company and the mainte- nance of 75 jobs in downstream activities in north- west Durham, where unemployment is high. The comments submitted to the Commission under the Article 93 (2) procedure by four Member States other than the United Kingdom and four associations representing the man-made fibres industry expressed support for the Commission’s concern. They empha- sized the surplus capacity problems in this branch and the efforts made by Community polyester yarn manu- facturers in reducing their capacity by 61 500 tonnes : cuts were made both before 1982 and since then and more are still to be made. The comments revealed that the quality of the partially oriented yarn produced by the company at Stanley is not out of the ordinary and could therefore be manufactured by any European firm provided that the demand for the product comes from solvent processors. The UK industrial association pointed to the excess capacity for polyester yarn manufacture dating from 1977. M1 The aid granted by the United Kingdom Government is liable to affect trade between Member States and distort or threaten to distort competition within the meaning of Article 92 (1) of the EEC Treaty, by favou- ring the company in question or its production.