STATE AID : FRANCE AND SNCM RESPOND TO EU.

While strikes have brought ferry services to Corsica to a halt, the Societe Nationale Corse Mediterranee (SNCM), a French maritime company which serves this island as well as Sardinia, Algeria and Tunisia, has moved into the category of offender in the EU's files on state aid that does not comply with EU law. In response to attacks from its competitor Corsica Ferries over aid received by the company since its restructuring, SNCM has pointed the finger at the public aid received by Corsica Ferries. The trade union CGT filed a complaint with the European Commission, on 20 December 2013, against this private ferry company for violating competition and social and fiscal dumping on shipping lines serving Corsica. The SNCM will do the same in the coming days, said Sebastien Mabile, the lawyer managing the dossier for the transport company, along with his colleague, Jean-Pierre Mignard.

The SNCM is in difficulty because its main shareholder, Trans Dev, a subsidiary ofaVeolia, wants to disengage, while employees are being asked to increase productivity on these lines. A social pact approved by 60% of staff during a referendum in December will be accompanied by an increase in the productivity of ships, and therefore by a renewal of the fleet. Yet this requires capital, and fair competition on these lines, explains SNCM.

The company jointly provides with the southern navigation company (CMN) the service between Corsica and Marseilles under a DSP agreement signed with the Corsican territorial collective and the Corsican transport office. Within this context, these companies receive aid for public services, and a large proportion of this aid has been judged incompatible by the EU Tribunal and the European Commission. The company must therefore pay back 440 million of the aid it received. "Moreover, the court has judged that the 'complementary' service during peak periods of the tourist season should not be part of the DSP, which considerably reduces its parameters," the French Ministry of Transport told...