Press Release: Italian law on disaster aid: the Commission says the aid must be linked with and in proportion to the damage caused

The European Commission ruled on 20 October 2004 that an aid scheme resulting from the extension of the term of validity to 2002 of an Italian law of 2001 which benefited firms carrying out investment in municipalities affected by natural disasters in 2002 was incompatible with the state aid rules of the EC Treaty. The reason for this was that the law seemed to be linked to the amount of investment rather than to the damage suffered. The Commission pointed out that this decision was without prejudice to individual cases which might meet the conditions for this kind of aid.