According to an EU’s Court of Justice ruling published on Friday, Greece is obliged to recover and return 150 million euros granted in aid to cereal producers and agricultural cooperatives, allocated by the government at the time in 2008.

The European Court dismissed the injunction application submitted by the Greek side with regard to the annulment of a relevant Commission’s decision in 2012.

According to Greek authorities, a surplus of maize and wheat in 2008 led to a fall in prices. In order to ensure a minimum income for farmers, 100% state-guaranteed loans amounting to €150 million together with interest-rate subsidies were granted via several ministerial decisions to 57 Unions of Agricultural Cooperatives (‘UACs’).

The loans were intended to be passed on to the producers of the cereals purchased or received by the UACs in 2008. The price of cereals set by Greece corresponded to the prices used for the calculation of the advances to be transferred to the farmers under the loan agreement.

The Commission found that those loans conferred an advantage selectively, since they were intended to increase the income of Greek farmers by artificially increasing the price of cereals sold to the UACs. Moreover, the cooperatives and the producers were the only beneficiaries of the loans. According to the EC, this advantage entailed a distortion of competition and affected trade between member-states.

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