Damm will have to return 1.1 million euros to the Government for the closure of Agama

PalmDamm will have to return 1.1 million euros to the Government of the subsidy it received within the framework of the transformation of the primary sector, after announcing the closure of the Agama factory in Palma and to fail to comply with the established regulations. The Ministry of Agriculture, Fisheries and Natural Environment will open an investigation to study the case, determine which points of the regulations have been met and what changes have been implemented during these almost two years, and thus be able to claim the return of this subsidy.

The dairy company applied for this aid in 2018, ostensibly to expand its product range and business areas. It finally received it in 2024. Part of this aid came from the Balearic Islands' budget, and the other part from European funds. The terms of this aid stipulate that, from the moment the Administration grants the subsidy, the beneficiary company must maintain commercial activity for at least five years. This means that Agama should have remained operational until 2029. Failure to comply with this clause now obliges the dairy company to return the money received, which the Balearic Government will formally demand.

One of the key factors that led the Ministry of Agriculture to grant the subsidy to Agama was that the Ministry of Business, Self-Employment and Energy had declared them a strategic project on December 1, 2023, a declaration that was called into question months ago and which the Government of the Balearic Islands even considered, revoke it.

In fact, just as with the subsidy, Damm, the company that owns Agama, reached an agreement with the Ministry of Agriculture committing to maintain investments in Mallorca's dairy sector in exchange for being declared a strategic project. The outcome of this agreement has been the same as that of the subsidy: Damm's breach of contract.