Taken to court again

Brussels – The noose around the neck of Olympic Airlines is tightening slowly but steadily. The European Commission will decide, most likely on April 4, to refer Greece to the European Court over illegal state subsidies that keep the ailing company afloat. European Transport Commissioner Jacques Barrot told reporters yesterday, at a press conference he called to present the EU’s «Black Book» of unsafe airlines, that «the examination of the Olympic file has already begun and, if necessary, a procedure for violating community law will be initiated.» Actually, the examination of the file began on September 14, 2005, when the Commission gave the Greek government two months in which to explain its position on subsidies. The Commission let the deadline pass but is now reopening the case. According to sources, the decision to take the case to the European Court has already been taken and remains to be formally ratified at the April 4 meeting of all commissioners, following which a «reasoned opinion» will be issued. The Thursday before that meeting, on March 30, the Commission’s Cabinet chiefs will discuss the issue and draft the decision. After the Commission meeting, the only chance for Greece to avoid the European court is for Olympic Airlines, or Olympic Airways – the EU has never accepted that these are separate companies – to pay back to the Greek state the 160 million euros deemed by the EU to have been the illegal subsidies provided between 1998 and 2002. The companies will most likely be be given two months in which to pay the amount, although an extension is not impossible. The EU has also ruled that Olympic Airlines, the company spun off from Olympic Airways to carry out the flights while Olympic Airways retained cargo handling and other ground operations, as well as Olympic Airways itself, have been subsidized to the tune of 540 million euros since 2002. The Greek government disputes the EU estimates, saying the total amount of illegal subsidies since 1998 was no more than 110 million euros. Despite Greek claims to the contrary, the case for the EU is clear: there is continuity between Olympic Airways and Olympic Airlines and the illegal subsidies must be repaid as soon as possible. This means that the next incarnation of the airline, whether called, as rumor has it, «Pantheon» or something else, must make a clean break with the past and not be saddled with its predecessors’ liabilities. Otherwise, like the Furies of ancient lore, the Commission will keep coming back, asking for more. (In Athens, HATTA, the Hellenic Association of Tourism and Travel Agents, said yesterday that it was desirable for the successor company, which is to be run by private investors, to keep Olympic’s brand name which, they said, has been quite popular with travelers. Terminating the airline’s operations should be avoided at all cost, they added.)