No L 112/52 Official Journal of the European Communities 3. 5. 94 COMMISSION DECISION of 12 April 1994 concerning aid to be granted by Portugal to the steel company Siderurgia Nacional (Only the Portuguese text is authentic) (94/257/ECSC) THE COMMISSION OF THE EUROPEAN COMMUNITIES, Having regard to the Treaty establishing the European Coal and Steel Community, and in particular the first and second paragraphs of Article 95 thereof, After consulting the Consultative Committee and with ~ the unanimous assent of Council, Whereas : The Community steel industry is currently experiencing its most difficult period since the first half of the 1980s. This is due to the general slowdown in the economy, which has had significant effects on industrial activities in general, and on the steel industry in particular, leading to a serious imbalance between supply and demand, accom- panied by a collapse in prices. In addition, the interna- tional market generally has been weak : there is pressure from imports and there has been a trade dispute with the United States of America affecting substantial Community exports to that market. All these factors have combined to aggravate the financial situation of almost all steel compa- nies in the Community. 11 On 30 July 1993, Portugal notified the Commission of a plan to restructure its steel company Siderurgia Nacional, including the associated financing means, with a request for a decision pursuant to Article 95 of the ECSC Treaty. The plan aims at restructuring the company in its economic, financial and organizational dimensions, with privatization as the ultiamte target. A holding company is to be set up, which will comprise three independent companies, specialized in long products, flat products and services. Siderurgia Nacional is the only steel company in Portugal with a significant industrial weight. The company has three plants in two different locations : one in Maia for long products (only rebars) and two in Seixal, one for cold-rolled flat products (galvanized sheets, tinplate and cold-rolled sheets) and the other for long products (rebars, wire rod and sections). At present, the maximum capacity of the company is 275 000 tonnes per year in cold-rolled flat products and 880 000 tonnes per year in hot-rolled long products (360 000 tonnes per year in Maia and 520 000 tonnes per year in Seixal). The core element of the restructuring plan consists of the replacement of the blast furnace of the Seixal plant for long products by an electric are furnace DC-EAF 140t. This furnace would be able to produce about 900 000 tonnes per year of liquid steel, which if used to full capa- city could almost double the final products. The Portu- guese authorities have given undertakings that furnace capacity will not be fully used and that it will be operated only during certain periods to take advantage of lower electricity tariffs, keeping its liquid steel production limnited to the mill’s production capacity. The plan also provides for the definite closure of the light and medium section mills in the Seixal plant for long products, by the end of 1995, thus reducing the capacity of the company in hot-rolled products by 140 000 tonnes per year down to 740 000 tonnes per year. After these closures, there will be only one mill per plant. No further reductions are possible without completely closing down one of the plants. In addition, some improvements in the remaining equipment are to be carried out in order to promote quality and a better market response. The plan also provides for some commercial measures aimed at improving the distribution network. It also contains some environmental investments as well as social and financial measures to ensure the social balancing of necessary redundancies and the future viability of the company. As regards employment, a reduction in the workforce by 1798 employees is envisaged, namely from 3 208 at the end of 1992 to 1 410 in 1997, i.e. a reduction of 56,04 %.