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One of the largest privatisation deals in Greece is challenged

11 September 2014 / 12:09:37  GRReporter
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The Greek Supreme Court has blocked the privatisation procedure of the area in the seaside Elliniko suburb where the Athens airport was located in the past. In justification of the decision, the judges state that the preliminary consideration of the contract and the process of providing the area to ​​ Lamda Development S.A. established violations of the principles of transparency, fairness and competition.

According to them, legal entities (companies or groups of companies) alone had the right to participate in the privatisation, which completely excluded the involvement of individuals, independently or in association with others, in the procedure. The court decision states that their access was limited "without stating or establishing a specific reason related to public order, public security or public health, or other compelling reasons in the public interest justifying this."

In addition, two important conditions were changed during the second phase of the competition, when the procedure was already in an advanced stage, and the already rejected companies were not able to submit new offers.

According to the majority of the magistrates, the decision not to assess the shares of Elliniko A.E. and the real rights regarding the immovable property before the start of the procedure for their utilization that is under consideration of the Supreme Court was correct, since the competent authority to determine at what point this will be completed is the Privatisation Fund.

Chairwoman of the Supreme Court Angeliki Margoudi however expressed the view that the assessment should have been made before the start of the procedure, the correctness of which is being considered by the magistrates.

In addition, she states that the decisions of the experts and the management board of the Privatisation Fund are not sufficiently grounded regarding "the protection of public interest, the application of sound financial management, and in terms of whether the deal that is controlled by the Supreme Court is in favour of, and benefits, the Greek state."

In response to a request from the Financial Supervision Commission, Lamda Development S.A. states that it ''was informed in the afternoon of 9 September 2014 by the Privatisation Fund that the Supreme Court had temporarily suspended the signing of the contract for the sale of 100 percent of the shares held by Eliniko A.E.''

The company was also informed by the Privatisation Fund that it is preparing, within 15 days, to submit to the competent department of the Supreme Court an application for annulment of the decision, as has been done in all such cases of privatisation in order to overcome the existing obstacles.

The company that was notified from the beginning that the preliminary agreed inspection would be carried out by the Supreme Court will consider the decision carefully, retaining all its rights, and will act in accordance with the law and duly inform the investment public."

Tags: EconomyCompaniesPrivatisationFormer airportElinikoSupreme courtLamda Development SA
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