Commission to take Athens to court over OTE agreement

The European Commission appears determined to annul the shareholders? agreement signed in 2008 between the Greek state and Deutsche Telekom regarding OTE telecom.

The ?reasoned opinion? text sent to Athens last month illustrates the Commission?s intention to take the case to the European Court unless Greece heeds its warning.

The text follows a letter of warning that Brussels sent in April 2009 and which Athens responded to in July that year with a series of arguments. The Commission is now countering all of those arguments one by one.

Greece had argued that the agreement did not constitute a state measure as it was a contractual commitment by the two shareholders that did not derive from a legislative act.

However, the reasoned opinion signed by European Commissioner for Internal Market and Services Michel Barnier cites a similar decision by the court against Germany regarding a law introduced concerning Volkswagen. The court had ruled that even the ratification by a national parliament of a private contract ?is sufficient to have it considered as a national measure as far as the free flow of capital is concerned.?

A number of other, weaker Greek arguments are also countered in the text, and Athens is likely to have a tough time avoiding being dragged to court over the agreement that the Commission believes has gone against the rules of competition.

The Greek government will now have to respond to the Commission?s reasoned opinion by June 30.