11 March 2014
The European Commission has found that public funding worth ca. €22 million, which was granted for the construction of the Liverpool cruise terminal is in line with EU state aid rules.
The Commission found that the public funding was limited to the minimum necessary to make the investment possible and the potential distortions of competition triggered by the public funding will be limited because the terminal will have a small market share, both in the EU and UK markets. The Commission also believes the positive effects of the project will outweigh any potential distortions of competition brought about by the aid.
Following a complaint, the Commission started to examine the financing of a new cruise terminal in Liverpool in 2011. The project was conducted by the Liverpool City Council and received funding from the UK (£9.2 million) and from EU Structural Funds (£8.6 million).
The UK carried out an in-depth financial analysis showing that the terminal operator's income from the use of the infrastructure would be insufficient to cover the investment costs over a period of 20 years. Therefore, the project would not be carried out without public funding. The Commission therefore concluded that the project is in line with Article 107(3) (c) of the Treaty on the Functioning of the European Union (TFEU), which allows state aid for the development of certain economic activities, provided that it does not unduly affect trade and competition in the Single Market.
Liverpool's cruise terminal was opened in October 2007 and built with the help of grants from the North West Regional Development Agency and the European Regional Development Fund. The landing stage was built on condition it did not compete for turnaround cruises with other UK ports. In May 2012, the government agreed to lift this if a portion of the grants were repaid.
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