There are two ways of looking at the saga of Opel, the European carmaker being sold by General Motors with the help of some €4.5 billion ($6.7 billion) in German state aid. The first, gloomy view is that the Germans have mounted a shocking assault on the principles of the European Union’s single market—and, worse, have got away with it.

During a sale process overshadowed by electoral politics, the German government openly favoured a consortium involving Magna International, an Austro-Canadian car-parts maker; Sberbank, Russia’s largest retail bank; and GAZ, Russia’s second-largest carmaker. The dodgy industrial logic of Magna’s plan, which would keep open all four Opel factories in Germany but trim production at more efficient ones in Spain, was, alas, electoral catnip to German politicians. They duly nodded and winked that they would hand over the cash only if Magna won.

Yet the EU’s state-aid rules forbid members from engaging in such subsidy wars. On October 16th the competition commissioner, Neelie Kroes, announced in effect that she had proof of cheating. Ms Kroes, a tough Dutchwoman, said there were “significant indications” that aid promised to Opel was conditional on Magna buying the firm, and on business plans that set out where future production would be based. She invited Germany to pledge that its money would be available to any investor. The government in Berlin issued a letter saying just this.

To many, the commission intervention looked terribly late. Rival bidders walked away long ago. European governments that had demanded a probe of the Opel deal, notably Britain’s, have now negotiated side deals with Magna to preserve jobs at home. And the commission could have done a lot more. A “smoking gun” was found among the 300 pages of papers delivered by the German government, making explicit references to Magna’s success being a precondition for German state aid. That would normally be enough to launch a formal state-aid investigation. Under EU rules, governments can subsidise jobs for specific, narrow purposes: eg, they can assist a firm to move to an economically depressed region, in return for pledges to create jobs that must last a given number of years. Moreover, during the credit crunch, governments may offer help to firms unable to raise capital by themselves. But governments making loans may not push firms towards mergers or investments for political reasons. Opel was supposed to make a purely commercial decision on its buyer.

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