Compatibility. In the Authority's view, the aid measures do not comply with any of the exemptions provided for under Article 59(2) (25) and Article 61(2) or (3)(a) and (d) of the EEA Agreement. In the Authority's preliminary view, the State support also cannot be justified under Article 61(3)(b) of the EEA Agreement. Despite the fact that the project is transnational, the aid in question presents itself in the form of sector aid, benefiting an individual company (Farice hf) and brought about by a private initiative of a group of business opera- tors. It is therefore questionable that this can be regarded as a project which is of common European inte- rest. It needs to be assessed whether the aid could be justified under Article 61(3)(c) of the EEA Agreement. Under this provision aid may be declared compatible if ‘it facilitates the development of certain economic activi- ties or of certain economic areas, where such aid does not adversely affect trading conditions to an extent contrary to the common interest’. However, the Authority finds that none of the Authority's State Aid Guidelines can be applied to assess aid measures that target this objective. The Authority in particular does not share the Icelandic authorities' view that the measure falls under the Act mentioned in point 1 f) of the EEA Agreement concerning aid to small and medium sized undertakings (26). In order to fall under the block exemption, Xxxxxx would have to be an independent enterprise in the meaning of Article 1(3) in conjunction with Article 1(1) in Annex I of the Act. However, more than 25 % of the capital is owned by operators which fall outside the SME defini- tion (this goes both for the State owned Síminn and the share ownership of the Icelandic State). The Authority therefore considers that the compatibility assessment is to be based directly on Article 61(3)(c) of the EEA Agreement. In this respect, the Authority will have to investigate the necessity and the proportionality of the measure. The Authority, however, notes that the Icelandic authorities have not yet provided sufficient information to enable the Authority to carry out a full analysis of this issue. On the basis of the information available, the Authority has come to the preliminary conclusions below.
