EU Commission Offers Financial Aid to Former Staff at BenQ Mobile

The European Commission has approved plans to offer financial aid to staff who lost their jobs at BenQ Mobile in Germany and the mobile phone accessories manufacturer, Perlos in Finland. These will now be put before the European Parliament and the Council for decision. Both applications to the European Globalisation Adjustment Fund (EGF) are made against a general trend towards delocalising production for mobile phones and accessories, mostly to Asia. This is not only because it is cheaper to make mobile phones there, but also because of the proximity of technology partners and a fast-growing consumer market.

Employment, Social Affairs and Equal Opportunities Commissioner Vladimir Spidla said, "I am happy to put these applications forward because they will help over 4,000 redundant workers back into employment. The EGF is being used as it was designed to - to respond to the impact of structural change on dynamic global markets."

The BenQ application concerns two German plants of the Taiwanese mobile phone manufacturer BenQ. In December 2006, BenQ withdrew financial support from the two subsidiary companies, resulting in about 3,300 workers being made redundant in three production sites in Munich, Kamp-Lintfort and Bocholt. The contribution requested from the EGF in the BenQ application is EUR 12.8 million.

The Perlos application relates to redundancies in two Finnish production plants of Perlos, a manufacturer of mobile phone accessories. In this case, some 1,000 redundancies were caused by the decision to discontinue production activities in Finland and to close down two Perlos factories located in Joensuu and Kontiolahti, in the Northern Karelia region, by September 2007. The contribution requested from the EGF in the Perlos application is EUR 2 million.

The EGF may give a financial contribution in cases where more than 1,000 workers in an enterprise or a regional sector are made redundant due to major structural changes in world trade patterns leading to substantially increased imports into the EU or a rapid decline in EU market shares.

Posted to the site on 27th September 2007