EU approves Hungarian investment aid to Toray’s lithium-ion BSF plant

Hungary’s €46.5 million investment aid to the chemical company Toray for a new battery separator film plant in the Közép-Dunántúl region in Central Transdanubia is in line with EU State aid rules, the European Commission said on July 2.

The aid will contribute to the region’s development whilst preserving competition, the Commission said, adding that the €46.5 million investment aid granted by Hungary will support Toray’s €397 million investment in a new production plant for lithium-ion battery separator films (BSF) in the Közép-Dunántúl region of Hungary.

BSF are a key component of lithium-ion batteries, used in consumer electronics, energy storage systems and electric vehicles. They function as the separator of the two major building blocks of a battery, preventing short circuits while allowing the movements of ions. The project, which started in 2019 and is planned to be completed in 2023, is expected to create nearly 200 direct jobs. The production plant is located in Közép-Dunántúl, an area eligible for regional aid under a treaty on the functioning of the EU. It will be Toray’s first plant for the production of BSF in Europe.

The Commission said it assessed the aid measure under the Guidelines on Regional State Aid for 2014-2020, which enable Member States to support economic development and employment in the EU’s less developed regions and to foster regional cohesion in the Single Market.

The Commission said that without the public funding, the project would not have been carried out in Hungary or any other EU country; the aid is limited to the minimum necessary to trigger the investment in Hungary; the investment aid will contribute to job creation as well as to the economic development and to the competitiveness of a disadvantaged region.

The Commission concluded that the positive effects of the project on regional development clearly outweigh any distortion of competition brought about by the State aid.