site.bta European Commission Considers State Aid to BDZ Permissible

ESD 15:51:00 09-09-2014
DD1550ES.125
125 POLITICS - EC - BDZ - STATE AID

European Commission
Considers State Aid
to BDZ Permissible


Sofia, September 9 (BTA) - A special letter of support sent by
Directorate General Competition to Transport, Information
Technology and Communications Minister Nikolina Angelkova says
that the European Commission considers the state aid for
restructuring of Bulgarian State Railways (BDZ) permissible, the
Ministry said on Tuesday.

The letter comes as a result of talks held last week in Brussels
when Angelkova provided additional analyses and arguments for
accelerating the process for notification of state aid to BDZ by
the European Commission as a necessary condition for future
negotiations with the creditors to get clearer parameters and
allow the normal functioning of BDZ.

The letter of support states that "...in relation to the
cancellation of 172 million leva of debts incurred prior to
Bulgaria's accession to the EU in 2007, I can inform you that
based on the information provided to us by the Bulgarian
authorities this measure appears to fulfil the conditions laid
down in the Community guidelines on State aid for railway
undertakings which provides a basis for declaring the
cancellation of debts of railway service providers incurred
prior to the accession to the EU (or prior to the liberalization
of the sector)."

Angelkova said: "The support that we have from the European
Commission is very important for us to renew the dialogue with
the creditors of the state railways. A meeting with the
company's creditors and bondholders is to be set to discuss
rescheduling options. The first step has already been made, as
the EC states with this letter that the legislation on
competition is not being violated and that BDZ may be granted
state aid." She added that there still remains much to be done
to improve the company's financial situation.
VI/DD