European Commission - Press release
State aid: Commission opens in-depth investigation into a Belgian protection scheme for shareholders of financial cooperatives
Brussels, 03 April 2012 - The European Commission has opened an in-depth investigation to assess whether an extension of the Belgian deposit guarantee scheme, aiming at the protection of shares in financial cooperatives such as ARCO, is in line with EU state aid rules. At this stage, the Commission has concerns that the scheme may enable cooperatives to attract or maintain capital because of the State support. This would confer those cooperatives an advantage over their competitors and distort competition in the internal market. The opening of an in-depth investigation gives interested third parties an opportunity to submit comments on the measures under assessment. It does not prejudge the outcome of the investigation.
"The extension of the Belgian deposit protection scheme to shareholders in cooperatives has both direct and indirect beneficiaries. The Commission will assess, in particular, whether the indirect effects of the scheme are compatible with EU State aid rules", said Commission Vice-President in charge of competition policy Joaquín Almunia.
The Commission has opened an in-depth investigation into the Belgian cooperative guarantee scheme protecting shares held by individual shareholders in recognised financial cooperatives. The Commission will assess whether the protection conferred by the cooperative guarantee scheme has helped or will help cooperatives to attract new capital or maintain existing capital that would otherwise not have been at their disposal. This would provide the beneficiary cooperatives with an economic advantage that their competitors, who have to operate without such support, did not have, in breach of EU state aid rules.
In October 2011, the Belgian ARCO group, a group of financial cooperatives that are currently under liquidation procedures, was the first recognised financial cooperative to ask for protection under the scheme.
Participation in the cooperative guarantee scheme is optional, and pay-outs from the scheme are only available to individual shareholders but not to institutional shareholders. The guarantee covers the paid-up capital of the cooperative shareholders, limited to a maximum amount of €100,000, and provided that the shares were issued before 10 October 2011, the date on which the cooperative guarantee scheme entered into force. The scheme would mainly be financed from annual contributions of participants, but the Belgian State would make advance payments should there otherwise be insufficient means.
A summary of today's decision will be published in the EU Official Journal, inviting interested third parties to comment within one month of publication.
The non-confidential version of the decision will be made available under the case number SA.33927 in the State Aid Register on the DG Competition website once any confidentiality issues have been resolved. New publications of state aid decisions on the internet and in the Official Journal are listed in the State Aid Weekly e-News