EC approves Germany's aid for AMD fab

The European Commission (EC) has given it green light on about Rs.1,469.19 crore ($360 million) of aid provided by the German state to chipmaker Advanced Micro Devices Inc. in support of its wafer fab investment in Dresden, Germany.

The German authorities intend to grant the aid to AMD for the conversion and extension of its existing microprocessor wafer fabs in Dresden. The Commission found that the support package, part of a about Rs.12,243.22 crore ($3 billion) investment in Dresden by AMD, would not distort the market or provide one region with an unfair advantage over another region.

"I am pleased to approve aid for an important investment project in a high tech sector which will contribute to regional development and job creation in a disadvantaged region of Germany," said Competition Commissioner Neelie Kroes, in a statement.

The EC's assessment of regional aid to large investment projects focuses on the market power of the beneficiary and on the production capacity created by the investment on the European market. The commission found that the relevant thresholds would not be exceeded. AMD's share of the relevant market is less than 25 percent, both before and after the planned investment. The EC also verified that the capacity increase generated by the projects would be below 5 percent of the apparent consumption of the product concerned in the European Economic Area.

- Peter Clarke
EE Times Europe