In October 2008, the government of Belgium announced a change in private-sector financial support.



  • 1 harmful
  • 0 neutral
  • 0 liberalising


the letter from the EC to Belgium - Brussels, 18.12.2008C(2008) 8820 final. Available from: < >
the letter from the EC to Belgium - Brussels, 18.11.2009 C (2009) 8980 final. Available from: < >

Inception date: 19 Dec 2008 | Removal date: open ended

Capital injection and equity stakes (including bailouts)

On 27 October 2008 the Belgian authorities contacted the Commission regarding their intention to make a capital injection of EUR 3 500 000 000 through special securities issued by KBC Group NV and fully subscribed by the Belgian State. The Belgian authorities and KBC closed the transaction on 19 December 2008.
The KBC Group NV is the holding company of the KBC Bank, KBC Insurance and KBL European Private Bankers (i.e. KBL EPB). KBC is an integrated bankinsurance group, catering mainly for retail customers, small and medium-sized enterprises (SMEs) and private banking clientele. KBC is one of the three main financial institutions in Belgium. Besides its activities in Belgium, central and eastern Europe, KBC is present in Russia, Romania, Serbia, several Western European countries and to a lesser extent in the US and Southeast Asia.
The Commission gave the following assessment:
"Given that KBC is active in the financial sector, which is open to intense international competition, any advantage from State resources to KBC would have the potential to affect intra-Community trade and to distort competition." (par. 41 of the letter from the EC to Belgium - Brussels, 18.12.2008C(2008) 8820 final)
Article 87(3)(b) 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. The Commission recalls that the Court of First Instance has stressed that Article 87(3)(b) EC Treaty needs to be applied restrictively and must tackle a disturbance in the entire economy of a Member State.
The Commission considers that this measure fulfils the conditions to be considered compatible with the Common Market pursuant to Article 87(3)(b) EC Treaty. Consequently, the Commission raises no objection against the notified aid and authorizes it as emergency intervention in the face of the current financial crisis for a period of 6 months. (par. 56-77 of the letter)
Asset relief and second recapitalisation for KBC -State aid C 18/2009 :
The second recapitalisation (valid from 30.06.2009) took the form of a capital injection of core Tier-1 capital by the Belgian authorities in the form of securities. The terms of the agreement are practically identical to the first recapitalisation except that the securities are not convertible into ordinary shares, and can only be redeemed at 150% of the issue price.
Due to the similarity of both measures, the EC did not change its assesment and considered the second recapitalisation as State aid and raises no objections. (par. 107-185 of the letter from the EC to Belgium - Brussels, 18.11.2009 C (2009) 8980 final)
A state measure in the GTA database is assessed solely in terms of theextent to which its implementation affects the extent of discriminationagainst foreign commercial interests. On this metric, the state aidproposed here is discriminatory.