The European Commission has opened a formal investigation under the EU State aid rules into Greek aid to the cereal sector. The aid took the form of (i) a loan amounting to € 150 million granted to Unions of Agricultural Cooperatives with the guarantee of the state, and (ii) the subsidisation of the interest for this loan.

The Commission has doubts concerning the compatibility of this scheme with EU law. The opening of a formal investigation allows the Commission to examine the measure more closely and gives interested third parties the possibility to submit comments. It does not prejudge the outcome of the procedure.

Following a complaint submitted in the beginning of 2009, the Commission decided to initiate an investigation concerning alleged State aids to cereal producing farmers and to cereal collecting cooperatives.

The Commission's preliminary investigation showed that the Greek government decided during 2008 to grant to Unions of Agricultural Cooperatives and indirectly to farmers, an aid which took the form of (i) a loan with the guarantee of the State amounting to € 150 million, and (ii) a subsidisation of the interest.

To this end, a number of ministerial decisions were adopted in the end of 2008, putting into effect the aids in question.

The Commission's preliminary investigation indicates that the measures adopted by the Greek State raise doubts as to the conformity of this aid scheme with the EU State aid rules.

The non-confidential version of the decision will be made available under the case number (NN 3/2010) in the State Aid Register on the DG Competition website (State Aid Register) once any confidentiality issues have been resolved.