(a) of the Law states that the fund may grant advances to cover up to 70 % of the value of a new vessel. Article 1 (b) provides for a State guarantee for additional loans contracted at market rates, while Article 1 (c) provides for an interest subsidy of half the rate applicable to such loans, although the subsidy may not exceed 3 %. The total amount of advances and loans provided for in Article 1 (a) and (c) may not, however, exceed 85 % of the cost of the vessel.
The Law does not, however, specify the rate at which, or the period over which, the advance provided for in Article 1 (a) must be repaid. During the preparatory work on Directive 87/167/EEC, the Belgian Government had informed the Commission of the repayment arrangements for advances granted under Article 1 (a) of the Law of 23 August 1948, stating that the advances were for 15 years at 4 to 5 % interest with a two-year grace period. These terms were again confirmed by the Belgian Government in its letter of 21 March 1988 during the review of all shipbuilding aid in Belgium pursuant to Article 10 of Directive 87/167/EEC.
V
In the light of the conditions notified to the Commission for the award of advances, guarantees and interest subsidies, and given a market interest rate of 8,25 % at the time the contracts were concluded, the grant equivalent of the advances granted by the Belgian Government under the Law of 23 August 1948 and duly explained to the Belgian authorities should have been 20,5 %.
As regards the vessels costing less than ECU 6 million, the Belgian Government had not informed the Commission of the specific arrangements, but had undertaken by letter of 6 July 1988 to comply with the maximum aid level which the Commission would fix in accordance with the second subparagraph of Article 4 (2) of Directive 87/167/EEC.
VI
Seven of the nine contracts referred to in this Decision actually benefited from an aid of 35 % and two from an aid of 23,5 %.
VII
As responsibility for the management of the maritime fund set up under the Belgian Law of 23 August 1948 had been transferred to the Flemish Regional Executive, the latter was therefore responsible for decisions taken from 1 January 1989 in accordance with the amendments made to the Belgian Constitution in 1988. This transfer of responsibility is not, however, an excuse for the Belgian Government to affirm the good faith of the Flemish Regional Executive on the pretext of ensuring the continuity of the aid scheme, since Article 5 of the EEC Treaty specifically states that Member States shall take all appropriate measures, whether general or particular, to ensure fulfilment of the obligations arising out of the EEC Treaty or resulting from action taken by the institutions of the Community.
Furthermore, the fact that the Belgian Government explained in a letter to the Commission that the Belgian aid scheme was made up partly of support for shipyards and partly of support for the operation of vessels flying the Belgian flag does not justify the terms on which the credits were granted. The arguments put forward in the letter simply reiterated matters which had been discussed at length with the experts of Member States during the preparatory work on Council Directive 81/363/EEC (4) and it was in full knowledge of the facts and to ensure complete transparency that the Council, backed by the Belgian Government, finally decided when it adopted Directive 87/167/EEC that the ceiling provided for in Article 4 (1) should cover all aid to shipowners relating to the purchase of a vessel in the Member States.
The Belgian Government was therefore fully aware of the position when it granted the credit in the case in question and the fact that aid was granted to shipowners for vessels built in third countries, for whatever reason, does not justify subtracting the equivalent of such aid when aid is granted for vessels built in Belgium.
VIII
The aid granted to shipowners in Belgium constitutes aid within the meaning of Article 3 (1) and (2) of Directive 87/167/EEC which provides that all forms of aid to shipowners or to third parties which are available as aid for the building or conversion of ships in Community yards, including credit facilities, guarantees and tax concessions, are subject to the rules set out in Article 4 of the said Directive.