Tax breaks received by French energy giant EDF in 1997 violated European competition law, the European Commission has ruled, EurActiv.com reports.
The European executive on Wendesday 22 June ordered French energy company EDF to pay back €1.37 billion it received in illegal state aid.
The French authorities failed to apply corporation tax to unused EDF provisions that were converted into a capital endowment during a 1997 restructuring of the company’s balance sheet.
This tax break coincided with electricity market liberalisation, at a time when EDF was investing heavily in upgrading its network.
The investigation had been re-opened in 2013 after an initial decision had been quashed by the Court of Justice of the EU.
EDF must now reimburse the French state €889m for the tax break and €488m in interest: a total of €1.37bn.