Financial Times FT.com

GM Europe

Published: September 24 2009 09:36 | Last updated: September 24 2009 23:15

“He who pays the piper calls the tune” is a proverb that often reflects hard reality – but it is not how European Union rules on state aid to companies are meant to work. Britain’s business secretary, Lord Mandelson, is rightly protesting that German aid promised to the Magna-led consortium acquiring General Motors’ Opel arm seems to favour German plants over those elsewhere. Belgium and Spain have raised similar alarms.

EU rules are designed to prevent aid that distorts competition or is provided on non-commercial terms. The European Commission must stick to its line that it will not allow support tied to plans specifying where job losses fall.

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