Competitive neutrality in the building materials sector

14.9.2006

WRITTEN QUESTION E-4050/06
by Charlotte Cederschiöld (PPE‑DE)
to the Commission

In Sweden at the present time, work is under way to implement a national strategy for building with wood. This national strategy aims to increase the use of wood, particularly in the building sector. The government's perspective under the strategy is that approximately 30 % of multi-family dwellings will in future have wooden frames.

The strategy derives from the State's extensive investment in R & D in the forest and woodworking industries in the 1990s. There was no investment in other building materials such as steel, brick, sandstone and concrete. The State's support for one single building material leads to distortion of competition.

A reference group has been set up for the national strategy on building with wood. The group's remit is to ensure that the purpose and objectives of the strategy are met. Members of the group include representatives of SABO (Swedish Association of Municipal Housing Companies ), Vinnova (Swedish Governmental Agency for Innovation Systems), the National Property Board, HSB National Federation, Akademiska Hus (a state-owned company managing properties at the country's universities and colleges), and the Swedish Road Administration. Several government agencies are thus involved in managing an operation which the industry itself should be responsible for.

The national strategy on building with wood, in close cooperation with the Swedish Wood Building Centre (Sveriges Träbyggnadskansli), is a collaborative venture between business associations, trade unions and the Ministry of Industry, which subsidises a range of activities. These activities include a tour of the country with government representatives and advertising which highlights the government's involvement.

Several municipalities have taken political decisions that wood should be used as a building material, which means that public procurement procedures require housing companies to build housing with wooden frames. This requirement is a breach of the Law on Public Procurement (1992:1528), the main rule of which concerning commercial practice clearly states that procurement must take place using the competitive options available.

Norway also has a wood programme broadly similar to the Swedish wood strategy. The Norwegian programme is to be examined by the EFTA Surveillance Authority (ESA) to establish whether it complies with the EEA agreement. A preliminary examination of the programme has found it not to be in accordance with the EEA agreement. The ESA suspects that the Norwegian wood programme constitutes unlawful state aid.

Does the Commission consider that competitive neutrality should apply in the building materials sector?

Will the ESA's examination of the Norwegian wood programme give rise to the examination of other countries' wood programmes?

OJ C 329, 30/12/2006