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Subsidy spat

July 22, 2016

In a long-running legal battle with Greece, the European Union is trying to impose a 6-million-euro fine against the cash-strapped Mediterranean nation for failing to recoup illegal state aid from a shipbuilder.

https://p.dw.com/p/1JUOz
Videostill Schleppende Privatisierung in Griechenland
Image: DW

This isn't the first time the European Commission has taken Athens to court over 250 million euros ($275 million) Athens gave to the Hellenic Shipyards company in the years leading up to 2002.

In 2008, the executive body ruled the money amounted to an illegal subsidy because it provided the maritime transportation firm with an unfair advantage, even though the firm was in financial trouble. In order to tip the competition scales back into balance, the EU demanded Greece recover the sum.

When that didn't happen, the European Court of Justice confirmed the Commission's findings in 2012. That should have put more pressure on Athens to comply, but the government in the indebted Mediterranean nation still did nothing.

Maybe a fine will help

Now the Commission is baring its teeth and has asked the EU's top court to impose a fine of 6 million euros, along with a daily fee of 34,974 euros until Greece obeys.

"The implementation of the 2008 decision will remove the unfair advantage received by Hellenic Shipyards, in breach of EU state aid rules, and aims to restore the level playing field in the market," the Commission said in a statement.

Nikos Aivatzidis and Alexandra Tsitoura in Athen
The Hellenic Shipyards in Athens, Greece are now seemingly emptyImage: Holly Pickett

Until 2002, Athens and a public Greek bank threw Hellenic Shipyards a financial lifeline to keep it afloat before it was privatized. The German industrial giant ThyssenKrupp owned it until 2010, when a majority stake was sold to a holding company in the Persian Gulf called Holding Abu Dhabi Mar.

But the suit filed on Friday wasn't the only legal action taken against Greece on Friday. The EU is also asking the Court of Justice to impose a fine of 30,311 euros a day over Athens' failure - along with Luxembourg and Romania - to comply with EU rules designed to give national rail regulatory bodies more clout.

cjc/jd (dpa, AFP)