ANNOUNCED AS TEMPORARYNo
Capital injection and equity stakes (including bailouts)
On 2 September 2009, Greece notified, following a number of pre-notification exchanges, a request to prolong and amend the scheme for the support measures for the credit institutions in Greece.
The Greek authorities request an approval of the scheme until the end of December 2009. All features of the original scheme would remain unchanged apart from the following elements of the recapitalization scheme:
"In relation to the extended recapitalization scheme, the Greek authorities proposed to apply the Recapitalization Communication which was adopted in December 2008 i.e. after the approval of the original Greek scheme. The scheme approved by the original decision requires the presentation of a 'restructuring' plan where the recapitalization measure has not been redeemed by the beneficiaries after 6 months from the granting of the measure. In line with point 40 of the Recapitalization Communication, the Greek authorities propose to provide 'viability' plans for the recapitalized institutions recapitalized under the extended scheme. However, restructuring plans are still required for the banks that have already been recapitalized." (par. 15 of the letter from the EC to Greece- Brussels, 18.09.2009 C(2009)7062).
The Commission concluded on the original measure that it 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 aid is granted from national or Community resources, via the respective aid granting authorities at all levels. The measure is selective since aid is awarded only to certain undertakings. The measure conveys an advantage by making available limited amounts of compatible aid which would not be available to the beneficiaries without the measure. 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. The measure distorts or threatens to distort competition." (par. 22-26 of the letter from the EC to Greece - Brussels, 15.07.2009 C(2009)5729).
The Commission concluded that the prolongation of the scheme until 31 December 2009 is appropriate and necessary to remedy the disturbance in the Greek economy. Since the extension of the scheme is targeted at filling the ongoing funding gap in Greece, the aid is therefore well targeted. Furthermore, given that the extension is limited to the end of December 2009, the potential distortion of competition will be limited. (par 25 of the letter from the EC to Greece- Brussels, 18.09.2009 C(2009)7062).
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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