Time Is Running Out For Olympic Airways

Last month, the European Commission requested the European Court to impose penalties on Greece for non-compliance with the Commission’s 2005 ruling that Olympic must repay illegal government subsidies of 161 million euros received from 1998 to 2002.

The EC’s latest request is that Greece be fined a lump sum of 5.3 million euros as well as a daily fine of 10,000 euros for every day that has past since last year’s ruling, which comes to about 3.8 million euros. Also, the EC requested this daily fine be increased to 53,000 euros if Greece is found guilty of making no attempt to recover the illegal aid.

Minister of Economy Giorgos Alogoskoufis said, “the EU decision does not mean automatic bankruptcy for the national airline.”

While Deputy Minister of Finance Petros Doukas said that negotiations with the EU were focused on reducing the sum Olympic must return to the government. He also reconfirmed earlier government announcements that investors had been identified who were interested in the plans to privatize the airline. Mr. Doukas added that the EU has already been sent a “detailed proposal and a list of interested investors.”

Meanwhile, Greece has also been taken to court by the EC for subsidies given to Olympic from 2002 to 2004, an amount that comes to 540 million euros.

The Federation of Civil Aviation Unions (OSPA) accused the government of willfully taking no action so that the penalties being imposed would finally be used as a reason to close Olympic.