NEWS

EU mulls new fine over OA subsidies

The European Commission is due to approve a decision today to take the government to court again over its inability to get illegal state funding back from Olympic Airlines, in a move that could lead to Greece being fined 50,000 euros a day. Legal advisers yesterday gave the go-ahead for the Commission to take the legal action which may also result in a one-off fine of 5.3 million euros for Greece. Brussels will haul the government before the European Court of Justice because Greece has not recovered any of the 161 million euros in illegal state aid that the court demanded last May. EU Transport Commissioner Jacques Barrot has been critical of the government’s failure to comply with the ruling. The aid, some of which was in the form of illegal tax breaks, went to Olympic Airways, the predecessor to current national carrier Olympic Airlines, between 1998-2002. The EU executive body has also taken Greece to court for failing to recover some 540 million euros of state aid given to Olympic from 2002 to 2004. Last year’s court decision was seen as the death knell for the airline but the government’s efforts to sell off the carrier have not been successful. The new fines will come into effect once the European Court has ruled on the case so Greece may avoid the penalties if it can reach an agreement with the Commission before then.