EC repeats call to get back state aid from Kremikovtzi

EC repeats call to get back state aid from Kremikovtzi

The European Commission (EC) reiterated its call to the Bulgarian government to take back the BGN 431.07 million provided to fund a major shake-up at the nation’s ailing steel behemoth Kremikovtzi.

The company has failed to fulfill the commitments it made against the financing obtained between 1998 and 2005.

After in August 2008 the steelmaker was declared insolvent, the state asked back the aid, initiating a procedure by the State Receivables Collection Agency (SRCA).

In addition to the BGN 431.07 million principal, Kremikovtzi needs to pony up a further BGN 267.8 million in interest, according to estimates of the economy ministry.

The debt-saddled company lodged an appeal against the claim and in June 2009 won a legal wrangle at first instance. Sofia Administrative Court overturned the state claim for BGN 698.9 million, toppling the state from the top of the creditors’ list.

The Commission extended the restructuring period until 2008 from the initial 2006 deadline. The European Union and the Bulgarian government agreed on specific rules to monitor progress on the plan’s implementation.