The state aid is in line with EU rules because production aid will decrease over time and Romania committed to carry out accompanying measures to mitigate the social and environmental impact of the closure, the Commission said in a statement Wednesday.
CNH, Romania’s largest debtor, operates seven coal mines and employs 8,800 staff. Four of the seven mines were deemed viable and will continue to operate after the company’s reorganization, while the three non-profitable units are to be shut down in the next years.
Petrila colliery is expected to close by the end of 2015 and the other two, namely Uricani and Paroseni collieries, by the end of 2017.
“The closure plan notified by Romania results in a gradual decrease of the overall amount of aid granted to cover production costs, in line with the EC decision. Moreover, the plan includes measures to mitigate the environmental impact of the production of coal,” the Commission said.
Romania has also committed to support miners who are to be laid off and their readaptation in order to help them find new jobs outside the coal industry.
According to Romania’s latest letter of intent to a EUR3.5 billion loan deal with the International Monetary Fund, the government is to launch liquidation proceedings for CNH by end-September.
The document shows CNH must transfer its non-viable assets to the national tax authority ANAF by the end of February.