EU regulators widen probe into Nurburgring aid
9 August, 2012
The European Commission said the extended probe would examine several additional financial measures provided in May to help avoid an immediate insolvency.
Nurburgring GmbH, 90 percent owned by the state, ran into financial trouble amid a dispute with the track’s operator over leasing fees, and the German state of Rhineland-Palatinate has sought to restructure the company with the help of a bridge financing package.
The measures included rescheduling interest payments on previously awarded loans and, possibly, an additional shareholder’s loan to keep the racetrack and its operator in business for six months during which a restructuring plan would be drawn up.
Rhineland-Palatinate is under pressure to make the track pay after pouring millions of euros into a racing-themed amusement park there.
Nurburgring, located about 120 km northwest of Frankfurt, alternates the German Grand Prix with the Hockenheimring, the host to the event in even-numbered years. It was the scene in 1976 of the fiery crash of then reigning Formula One world champion Niki Lauda, which almost killed the Austrian.
The track is used by automakers including BMW and Toyota to test cars.
“At this stage, the Commission has doubts that the measures were granted on market terms and that the companies are viable without continued state support,” the EU watchdog said in a statement.
It said the latest public support was linked to 524 million euros ($650.81 million) of state aid granted by German authorities which it has been investigating since March to see if they had been given on market terms.
Public authorities can only provide financial support to troubled companies once in 10 years under EU state aid rules.
Subbed by AJN.