IMPLEMENTATION LEVEL

National

AFFECTED FLOW

Inflow

ANNOUNCED AS TEMPORARY

No

NON-TRADE-RELATED RATIONALE

No

ELIGIBLE FIRMS

all

JUMBO

No

TARIFF PEAK

No
← back to the state act
Inception date: 07 Dec 2011 | Removal date: 06 Jul 2012
Still in force

Bailout (capital injection or equity participation)

On 9 October 2008, Italian Government adopted a Decree-law #155 on "Urgent measures to guarantee the stability of the credit system and the continued availability of credit t enterprises and consumers in the current crisis on international financial markets", which is aimed at strengthening the capitalization of the banks. On 13 October 2008 Italy adopted a Decree-Law # 157 on further urgent measures to guarantee the stability of the credit system, which is aimed at sustaining the liquidity of the banking system by providing the banks with assets eligible for refinancing with the Eurosystem by means of State guarantee and swaps transactions with the Ministry of Economy and Finance. Thus, with regard to the Decree # 157, the Central Bank of Italy on 13 October 2008 adopted measures to increase the liquidity of the banking system. Only Italian bank or foreign branches of banks established in Italy (only around 8 percent of total assets are owned by branches of foreign banks) are eligible to the scheme - other 92 percent of the total assets of foreign banks are not in the programme.
 
The Italian authorities have accepted that the measures contain state aid. However, the Italian Government claimed that the measures are compatible with the common market because it is necessary to remedy a serious disturbance in the economy pursuant to the Article 87(3)(b) of the EC Treaty.
 
The Commission agreed that the measures constitute State Aid pursuant to Article 87(1) EC. Those measures according to the European Commission's letter to Italy "give an economic advantage to the beneficiaries and strengthen the position of these beneficiaries compared to that of their competitors in Italy and other Member States and must therefore be regarded as distorting competition and affecting trade between Member States."(par. 57 of the EC letter to Italy 13.XI.2008, C(2008) 6989 corr, Brussels).
 
Article 87(3)(b) of the EC Treaty enables the Commission to declare aid compatible with the Common Market if it is "to remedy a serious disturbance in the economy of a Member State." This aid has to be applied restrictively and must tackle a disturbance in the entire economy of the Member State according to the interpretation of the Article 87(3)(b) by the Court of First Instance.
 
 The Commission referred to its Communication on the financial crisis and concludes that the Measure complies with the conditions laid therein. Therefore, despite the measure constituting State aid pursuant to the Article 87(1) EC, it is compatible with the Common Market according to the Article 87(3)(b) EC Treaty. The Commission raises no objections against the measure at issue and authorizes it as emergency intervention in the face of the current financial crisis (Decision of the EC letter to Italy 13.XI.2008, C(2008) 6989 corr, Brussels)
 
Prolongation of the Italian Guarantee Scheme - State Aid N328 /2009
On 29 May 2009 Italy notified a request to prolong its guarantee scheme for banks until 9 December 2009.
The Commission has decided not to raise objections against the prolongation, since it fulfils the conditions to be considered compatible with the EC Treaty.

 
Reintroduction of the Italian guarantee scheme - SA.34032 & Budget increase SA.34344

According to the EC, the Italian authorities announced on 7 December 2011 the reintroduction of the scheme until June 2012. The Commission has decided not to raise objections against the temporary reintroduction.

 
On 13 February 2012, Italy notified its intention to increase the total budget of the scheme from EUR 80 billion to EUR 110 billion. The Commission has decided not to raise objections against the increase.

 
A state measure in the GTA database is assessed solely in terms of the extent to which its implementation affects the extent of discrimination against foreign commercial interests. On this metric, the state aid proposed here is discriminatory.
 

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