UPDATE 1-EU: Hungary must recover 112 mln euro aid from MOL

Wed Jun 9, 2010 1:52pm GMT
 

* Commission says state aid breached EU rules

* MOL says has not received notice of the order yet

* MOL shares down 2 pct vs market down 0.3 pct

(Adds MOL comment, shares)

BRUSSELS, June 9 (Reuters) - European Union competition regulators ordered Hungary on Wednesday to claw back 112 million euros ($150.3 million) from Hungarian energy group MOL (MOLB.BU: Quote) as the aid was deemed to have breached EU rules. The decision followed an investigation by the European Commission that started in January last year into a deal exempting MOL from an increase in mining fees.

"The investigation has proven that MOL benefitted (from) a financial advantage by paying lower mining fees than its competitors. This type of clearly discriminatory aid is not allowed under EU rules," Competition Commissioner Joaquin Almunia said in a statement.

MOL shares were down 2 percent by 1322 GMT versus a 0.3 percent fall in the Stoxx Europe 600 oil and gas index .

The company said it had yet to receive a notice of the Commission's order.

"Once we get it and read it, then will we be able to react to this," MOL's Hungarian communications director Andrea Panczel said.

Hungary raised mining fees in early 2008 but MOL's mining royalty payments remained unchanged at levels agreed in a 2005 deal with the government.

The Commission, tasked with ensuring a level playing field in the 27-member bloc, can take governments to court for non-compliance with its state-aid rules. (Reporting by Foo Yun Chee, additional reporting by Krisztina Than in Budapest, Editing by Erica Billingham)

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