The European Commission is investigating whether the Dutch government gave too much state aid for the development of Hewlett-Packard and SCI Netherlands' PC factory in Heereveen, Noord Friesland.
Commissioners believe that the Dutch government may have exceeded the 20 per cent ceiling on aid under the Netherlands' regional aid scheme. Dutch authorities have been given a month to reply.
"The group is expected to produce PCs by the end of 1999. In the beginning of 1998 a complainant alleged that aid going beyond the commission approved regional aid scheme had been granted by the regional authorities," the commission said.
"The information provided by the Dutch authorities appeared to confirm the complainants allegations. Land had been sold to HP-SCI Systems at below market price. The Dutch authorities were requested to provide a response," it said.
The commission has doubts about the scheme's conformity with EU state aid rules and wants to see a detailed business plan for the project. The inquiry will look at the market price of the land, employment subsidies and temporary factory facilities for the factory to be built at the International Bedrijvenpark Friesland industry park, it said.
Commission sources have previously said the 24 hectares of land, not 10 hectares as earlier believed, was sold at Nfl 3 (#0.93) per square metre, rather than the Nfl 24 (#7.49) a square metre development cost, which would amount to Nfl 5.76 million (#1.79 million) in hidden aid for the whole site.
SCI will build and run the factory to produce PCs, mainly for the European market. The project is one of the biggest inward investment projects in the Netherlands and seen as politically sensitive, they said.
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