BRUSSELS (AP) — The European Union's executive says it is investigating French state help to companies that supply parts to aircraft manufacturers.
It says it doubts that France's "Aero 2008" program offering exchange rate risk insurance is legal under EU rules, claiming that the insurance premiums may not be in line with market prices and could be easily supplied by banks.
The EU sets strict limits on state aid to companies which can be granted only at market terms and if companies can't get similar coverage elsewhere. It can demand the companies repay any aid if it decides it is illegal.
France argues four aeronautic suppliers can't find a bank offering long-term exchange rate risk insurance for the supplies, worth $10 million.