Credit institutions and state aids in EC law

This article is aimed at providing a brief overview on the impact of State aids on the pursuit of business by credit institutions by briefly describing the most recent and relevant EC Commission policies and decisions on the matter. As it is known, credit institutions, whether publicly or privately owned, are subject to EC competition rules, including State aid rules. The need to meet the strict requirements imposed by the EC banking Directives, which has lately constituted the main reason for the grant of public financing to credit institutions, does not exempt the credit business from the application of the rules on State aids which are contained in the EC Treaty. In the 1990s the coming into force of the banking Directives, together whit the achievement of the internal market and the gradual introduction of the economic and monetary union, have imposed on the credit institutions the need hoth to observe strict banking law requirements and to improve their competitiveness in a broader market. In order to meet these challenges, some European Member States have therefore resorted to granting aids to their credit institutions. The said aids were aimed either at keeping the banks concerned in business and competitive or at favouring their restructuring and final privatisation. As it appears obvious from the Commission decisions on State aids to credit institutions which will be examined in this article, any direct or indirect aid may have a significant impact on the pursuit of business by the credit institution, in particular on the preservation of the conditions for its authorisation, on the expansion or reduction of its activities, and on its competitiveness in the European market. Therefore the control over overt and covert State aids to credit institutions represents for the European Commission a significant and challenging task.

Rossella Delfino, Credit institutions and state aids in EC law in "ECONOMIA E DIRITTO DEL TERZIARIO " 1/2002, pp , DOI: