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Inception date: 01 Jun 2009 | Removal date: 31 Mar 2012

Loan guarantee

On 21 May 2009, Greece notified the Temporary aid scheme for granting aid in the form of loan guarantees under the Temporary Framework for State aid measures to support access to finance in the current financial and economic crisis.
The Greek authorities foresee a set of national measures aimed at remedying a serious disturbance in the economy of Greece. The assessed measure is part of this set of measures that contains also an aid measure in form of limited amounts of compatible aid and an aid measure in form of subsidized interest rate.
By adopting this national set of measures the Greek authorities aim at boosting the demand side of the economy by improving the access of firms to investment and working capital loans in order to compensate for the insufficient loan activity by private banks resulting from the financial crisis.
The aid will be provided in the form of guarantees for working capital loans and investment loans.
The Greek authorities identified the common budgetary ceiling of EUR 2 billion for the implementation of this notified measure (N 308/2009) and the aid measure "Temporary aid in the form of subsidized interest rate" (N 309/2009).
The beneficiaries of the scheme are SMEs and large undertakings. The scheme is open to all sectors.
The Commission stated that the notified measure constitutes state aid within the meaning of Article 87 (1) of the EC Treaty and gave the following assessment:
"State resources are involved in the notified scheme since the loan guarantees are made available by national authorities. The measure is selective since guarantees are awarded only to certain undertakings. The measure confers an advantage by relieving the beneficiaries of costs which they would have to bear under normal market conditions since, without the intervention by the State, the beneficiaries would obtain loans only at higher costs, if at all. The measure affects trade between Member States since the scheme is not limited to beneficiaries which are active in sectors where no intra-Community trade exists." (par. 34-37 of the official letter from the EC to Greece - Brussels, 03.06.2009 C(2009)4439).
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 (Temporary Framework) and concluded 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. (par. 39-44 of the letter).
Prolongations of the Greek temporary Scheme for loan guarantees -State Aid SA.33204 (2011/N) and SA.34044 (2011/N)
By electronic notification of 15 July 2011 Greece notified the prolongation of the existing guarantee scheme (see above) until 31 December 2011. The Commission has decided to consider the notified prolongation of the aid scheme as compatible with Article 107(3)(b) of the TFEU since the prerequisites for the compatibility of schemes that have been established by the Temporary Community Framework continue to apply. Furthermore, the Commission considers that the notified prolongation of the existing guarantee scheme accompanied by stricter conditions until 31 December 2011 complies with the requirements set out in point 2.3 of the Temporary Union Framework and is therefore compatible with the internal market. - SA.33204
By electronic notification of 8 December 2011 Greece notified the prolongation of the guarantee scheme (see above) until 31 March 2012. The Commission considered that the prolonged scheme is appropriate, necessary and proportionate to remedy a serious disturbance of the Greek economy, on the basis of Article 107(3)(b) TFEU in view of specific exceptional circumstances. - SA.34044
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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