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EU court upholds decision to limit German aid for BMW car plant
September 12, 2017 / 3:19 PM / in a month

EU court upholds decision to limit German aid for BMW car plant

A BMW logo is seen at a car dealership in Vienna, Austria, May 30, 2017. REUTERS/Heinz-Peter Bader

BRUSSELS (Reuters) - An EU court on Tuesday dismissed German carmaker BMW’s (BMWG.DE) bid to overturn a European Commission decision limiting the amount of state aid it could receive.

The Commission stipulated in 2014 that the carmaker should receive no more than 17 million euros ($20 million) to expand production of two models of electric and hybrid passenger cars in Leipzig, a project expected to create 800 jobs.

Germany had originally planned to grant 45 million euros towards the project, but the Commission ruled any amount exceeding 17 million euros was incompatible with internal market rules.

BMW challenged the decision, claiming that the Commission had made errors in calculating the cost of the project.

The General Court of the European Union, the EU’s second highest court, rejected BMW’s complaint.

BMW said it was surprised by the ruling, saying it was effectively being punished for its plan to bring an innovative investment to a disadvantaged region. If it had planned to produce a normal car, then according to the Commission’s logic it would have been entitled to the aid in full, it said.

“We will carefully review the ruling and decide in the next few weeks whether to appeal to the European Court of Justice,” the company said in a statement.

Reporting by Lily Cusack and Peter Maushagen; Editing by Philip Blenkinsop and Susan Fenton

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