By Henrietta Billings - 19th January 2005
The European Commission has announced a formal in-depth probe into Rome's planned rescue package for troubled Italian airline Alitalia.
Brussels said on Wednesday it would open investigations into whether the government plan, involving €1.2 billion recapitalisation of Alitalia's flight division and a partial sale of its ground operations, constitutes illegal state aid.
“The Italian authorities have presented a serious industrial plan. Certain parts now have to be checked to confirm that the plan does not contain state aid.
"I want our analysis carried out swiftly," said EU transport chief Jacques Barrot.
The European Commission said in a statement that the aim of the probe is to check that the restructuring package complies with state aid rules and "that the commercial ties between the two companies are in order".
Under the “one time, last time” principle, Alitalia cannot claim further restructuring aid as it already received government aid in 1996-1997.
EU regulators started reviewing the restructuring plan in October last year which includes splitting the airline's flight and ground operations and an injection of more than €1 billion.
The €220 million takeover of its ground services - AZ Services - by the state owned company Fintecna will also be examined.
Under EU state aid rules, Italy must get the go-ahead from Brussels before the package can be implemented.
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