§ Lord Shore of Stepneyasked Her Majesty's Government:
Further to the Written Answer by Lord McIntosh of Haringey on 25 November (WA 15), what were the reasons given by the European Commission for judging the small firms capital allowance to nonagricultural enterprises in Northern Ireland under Article 87 of the EC Treaties to be incompatible with state aid rules, when paragraph 3(a) of that article specifically allows for "aid to promote the economic development of areas where the standard of living is abnormally low or where there is serious under-employment''. [HL135]
§ Lord McIntosh of HaringeyThe question is based on the premise that the non-agricultural elements of the proposal were judged to be incompatible with state aid rules. That is riot the case: as stated in the Written Answer given on 25 November (WA 15), the European Commission decided on 25 June 1999 that the proposal to allow 100 per cent first year capital allowances to non-agricultural enterprises in Northern 94WA Ireland was compatible with the state aid rules as contained in Articles 87 and 88 of the Treaty of Rome (as amended by the Treaty of Amsterdam).