The Commission has decided to terminate the Article 93(2) proceedings which it had initiated in respect of social aid for the conversion of Victorio Luzuriaga SA from the ECSC steel sector (in overcapacity) to nodular and grey cast iron (sector which is not sensitive or covered by a framework). Although the aid referred to above is by nature state aid within the meaning of Article 92(1) of the EEC Treaty by virtue of the fact that the state grants extraordinary aid introduced by Law 27/1984 for the benefit of certain firms in order to ease the burden of social costs associated with redundancies, the Commission considers that the aid in question is eligible for the derogation set out in Article 92(3)(c) of the EEC Treaty since, firstly, it helps to reorganize a sector in overcapacity and, secondly, because it forms part of a restructuring plan to restore the firm's profitability and is received directly by the employees and is thus restricted to the partial financing of the social part of the said plan, so that it is aid such as to facilitate the development of an economic activity without adversely affecting Community trade to an extent contrary to the common interest. * * *
