The British Iron and Steel Producers' Association has said it is backing the British Steel decision to start legal action against the European Commission over subsidies to Irish Steel "within weeks". British Steel's action will question the legality of the State support under article 95 of the Treaty of Paris.
British Steel has warned that the Irish Steel package, which will also allow an increase in the Cork plant's capacity, could threaten up to 500 jobs at British Steel's Shelton plant in England.
The Munster MEP, Mr John Cushnahan, said last evening he was confident that British Steel's challenge to the Government's State aid for Irish Steel would not succeed and that the Cork based company would continue to prosper.
Mr Cushnahan said that he had been in touch with Mr Richard Bruton, the Minister responsible for Irish Steel, who had assured him that, as far as the Government was concerned the decision to callow a state aid injection to the troubled Cork Harbour steel plant would be upheld.
