No L 298/14 Official Journal of the European Communities 22. 11. 96 (Acts whose publication is not obligatory) COMMISSION COMMISSION DECISION of 30 April 1996 on State aid in favour of La Seda de Barcelona SA, located at El Prat de Llobregat, Cataluiia, and at Alcald de Henares, Comunidad de Madrid (Only the Spanish text is authentic) (Text with EEA relevance) (96/65S/EC) THE COMMISSION OF THE EUROPEAN COMMUNITIES, Having regard to the Treaty establishing the European Community, and in particular the first subparagraph of Article 93 (2) thereof, Having regard to the Agreement establishing the Euro- pean Economic Area, and in particular Article 62 (1) (a) thereof, Having, in accordance with the abovementioned Articles, given notice to the parties concerned to submit their comments to it, Whereas: I On 30 November 1994, the Commission decided to initiate proceedings pursuant to Article 93 (2) of the EC Treaty in respect of the following: — the agreement between the Fondo de Garantia Salarial (hereinafter ‘Fogasa’) and La Seda de Barcelona SA (hereinafter ‘LSB’) by which the latter will reimburse over a fixed period Pta 1221 136 511 with respect to the payment by Fogasa of wages and severance pay owed by LSB to its former employees, — the agreement by which a guarantee for up to Pta 1 700 000 000 was provided by the Institut Catala de Finances (hereinafter ‘ICF’) in support of three loans taken out by LSB, together with the accrued interest thereon, — the decision of the Comunidad de Madrid to approve the provision of a guarantee for up to Pta 1 000 000 000 in support of a loan taken out by LSB, together with the accured interest thereon, and — the proposal of the Comunidad de Madrid to award rescue aid to LSB pending revision of its restructuring plan and completion of the Commission’s investiga- tion. In taking that decision, the Commission noted that, on the information provided by the Spanish Government, it was unable to determine whether or not the agreement between Fogasa and LSB contained State aid. Similarly, the Commission was unable to decide whether or not State aid was contained in either the guarantee provided by ICF or the guarantee whose provision had been approved by the Comunidad de Madrid. However, as LSB appeared to be a company in difficulty, the Commis- sion concluded that both of the State guarantees contained at least an element of State aid. Therefore, as there is significant trade within the European Economic Area (hereinafter ‘EEA’) in all of LSB’s products, the Commission considered that the guarantees would be likely to distort competition. As the restructuring plan that the guarantees were intended to facilitate would be unlikely to restore LSB to viability, the restructuring aid did not appear to satisfy the conditions laid down for the authorization of such aid or to comply with the code on aid to the synthetic fibres industry. Accordingly, the Commission considered that the guarantees appeared incompatible with the common market and the func- tioning of the EEA Agreement.