ECONOMY

Talks on saving beleaguered Olympic come to an end

BRUSSELS – Negotiations to save Olympic Airlines have ended. Any talks taking place between Greece and the European Commission relate to a day-after scenario for the airline, with Brussels announcing the initiation of further legal proceedings against Greece. Michele Cercone, spokesman for EU Transport Commissioner Jacques Barrot, said yesterday that «time has run out» and that «it is absolutely clear that we cannot wait anymore.» In order to highlight the urgency of the issue, Brussels has announced the start of further legal proceedings against Greece for December 19 that relate to state subsidies from 2004 until this year. According to sources, Brussels considers explanations given by Athens regarding the offsetting of debts owed to the state by Olympic to be unconvincing. The December 19 action also involves an investigation into subsidies given between 2004 and 2007, which the Commission automatically considers to be unlawful, in view of the country being referred to the court a few weeks or months later in connection with recourse by the Commission regarding subsidies given during the period 1998-2004 totaling 700 million euros. Asked about the Commission’s new push to settle the OA issue, Cercone said this is due to the company’s worsening situation and the need to «protect the Greek taxpayer’s money.» Additionally, the Commission said that it is facing the threat of legal action from Ireland’s Ryanair due to what is views as flexibility shown to OA. Regarding domestic services to remote islands, the Commission underlines that EU law not only allows but actually encourages the funding of airlines following a tender procedure. However, Cercone said that the possibility of OA immediately re-operating with a new corporate structure is something «hypothetical» which he is hearing for the first time. As for Sabena-type solutions, the Commission’s view is that it is just one of many alternatives.