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European Commission

Press release

Brussels, 3 July 2014

State aid: Commission orders Belgium to recover incompatible state aid from financial cooperative ARCO

Following an in-depth investigation, the European Commission has concluded that a Belgian guarantee scheme for shareholders of financial cooperatives was incompatible with EU state aid rules. In particular, the guarantee conferred a selective advantage to the Belgian financial cooperative ARCO, the only beneficiary of the scheme, who now has to pay back the undue advantage it received.

In November 2011, Belgium notified a scheme aimed at protecting from losses shares held by individual shareholders in recognised financial cooperatives. The measure had already been put in place, in breach of the obligation for Member States to get prior Commission approval for new state aid measures. It appeared that ARCO was the only financial cooperative that had made use of the scheme. In April 2012, the Commission opened an in-depth investigation (see IP/12/347).

The Commission's investigation revealed that the public guarantee makes the financial cooperatives that benefit from it more attractive for investors as compared to their competitors, who have to operate without such a guarantee. The scheme thus confers a selective advantage to its beneficiaries and therefore constitutes state aid.

The Commission then proceeded to assess whether the aid could be found compatible with EU rules that allow aid measures to further certain objectives of common interest, provided they do not unduly distort competition in the Single Market.

The Belgian authorities contend that individual shareholders of financial cooperatives are in a situation similar to bank depositors. However, the Belgian legal framework for cooperative companies and the articles of association of the companies concerned make it clear that financial cooperatives are limited liability companies and unlimited liability companies. Contributions to their capital are made in the form of equity investments and are subject to equity risk. There would be no basis for considering such a measure compatible with EU rules on state aid.

Since Belgium had already implemented the measure before notifying it to the Commission, ARCO now has to pay back the economic value of the advantage that it has received.


On 3 April 2012, the Commission opened an in-depth investigation following Belgium's notification of the so-called "cooperative guarantee scheme”, which was aimed at covering the shares of individual shareholders in those recognised cooperatives which either were under prudential supervision of the National Bank of Belgium ("NBB") or had invested at least half of their assets in an institution subject to such supervision ("financial cooperatives").

The only financial cooperative which applied for the cooperative guarantee scheme was ARCO. Historically, ARCO was the shareholder of Artesia, which itself owned 100% of BACOB bank and 82% of insurance company DVV. As a result of the merger of Artesia with Dexia in 2001, ARCO became the biggest shareholder of Dexia with a stake of around 15%.

ARCO is a group name for ARCOPAR, ARCOPLUS and ARCOFIN, which are all recognised cooperative companies. ARCO has more than 800 000 members, 99% of which are individual persons. The capital of individual shareholders in ARCOPAR, ARCOPLUS and ARCOFIN amounted to €1 300 million, €46 million and €140 million respectively.

On 8 December 2011, the general assemblies of ARCOPAR, ARCOPLUS and ARCOFIN approved the proposal of their management board to put the cooperatives into voluntary liquidation.

The non-confidential version of the current decision will be made available under the case numbers 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.

Contacts :

Antoine Colombani (+32 2 297 45 13, Twitter: @ECspokesAntoine )

Yizhou Ren (+32 229-94889)

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