The Court of Justice confirmed that Greece has failed to comply with a Commission decision adopted in 2005 finding that it had granted illegal and incompatible aid to Olympic Airways Services and Olympic Airlines, and asking for such aid to be recovered.
Vice-President Jacques Barrot, Commissioner in charge of transport, said in a statement: "I take note of this ruling, which follows several rulings by the European Courts and decisions by the Commission in this dossier. It confirms the urgent need for a viable and legally sound solution to this file. This is in the interest of the European aviation sector, of Greek consumers and tax-payers, but also of the employees of Olympic Airways Services and Olympic Airlines and is indispensable in order to preserve a continuity of service to remote areas in Greece.
Should it be the case that swift compliance is not achieved, I would have no choice but to propose to the College to file a new action with the Court of Justice, asking for the imposition of fines and periodic penalty payments."
The yesterday’s (14 February) Court judgment concerns the Commission decision of 14 September 2005.
In that decision, the Commission found that Greece had granted, between 2002 and 2005, illegal and incompatible State aid to Olympic Airways Services and Olympic Airlines, which have taken over respectively the ground activities and flight operations of Greece’s State-owned flag carrier Olympic Airways. The Commission ordered Greece to recover the aid from the beneficiaries. Following Greece’s failure to do so, the Commission decided on 26 April 2006 to take Greece to the European Court of Justice. The present judgment by the Court supports the Commission’s stance regarding Greece’s non-compliance with the 2005 decision.
Between 1994 and 2000 the Commission took three decisions authorising public aid for the restructuring of Olympic Airways. In December 2002, however, the Commission found that further aid had been granted to the airline which was incompatible with the common market, and asked Greece to recover such aid. Greece failed to comply with this decision, which has in the meantime been largely upheld by the Court of First Instance on 12 September 2007. Following a judgment by the Court in May 2005 confirming non-compliance with the 2002 decision, the Commission filed an application for the Court to impose fines and periodic penalty payments on Greece, pursuant to Article 228 of the Treaty (18 October 2006).
On 19 December 2007, the Commission opened a new formal investigation into alleged illegal aid that may have been granted to Olympic Airlines and Olympic Airways Services since 2005.