Brussels, 20/03/2013 (Agence Europe) - The European Commission has concluded two separate in-depth investigations into state aid for short-term export credit support measures granted to insurance companies Ducroire of Belgium and SACE BT of Italy by their respective state-owned parent entities, Office National du Ducroire (ONDD) and SACE, concluding that it was used to subsidise insurance products that could easily have been found on the private market.
For Ducroire, the Commission cleared €113.4 million of an initial capital injection totalling €150 million which was granted to Ducroire in 2004. This is because it benefitted products that were not offered - or offered in limited quantity - by private operators. However, for the remaining €36.6 million, which supported activities that were open to competition, the Commission investigation found that the expected profitability of the investment was not sufficient. For SACE BT, the Commission found an initial capital allocation of €105.8 million granted in 2004 was in line with EU state aid rules, because the capital was injected into a newly created subsidiary with the objective of offering short-term export-credit insurance on market terms as well as other commercial activities. However, for additional capital injections in 2009 to cover losses and a reinsurance cover in favour of SACE BT, totalling €70.2 million, the state-owned parent entity did not take into consideration the risk profile of the investment. The Commission has ordered recovery of the section of the aid to the two companies that conferred undue economic advantage. (FG/transl.fl)