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Piraeus Bank and the state are in a dispute over the privatization of Egnatia highway

27 November 2012 / 23:11:23  GRReporter
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Piraeus Bank has filed a claim in the District Court in Athens against the company Egnatia Odos S.A., the state and the public property management fund. The financial institution requires the annulment of the loan contract, under which the Bank had granted 250 million euro for the completion of the highway in 2006. Revenue from tolls repaid the loan, which the bank will probably not be able to receive once the national road goes into private hands.

In addition to the claim in the District Court, Piraeus has filed a claim with the State Council (Supreme Administrative Court), which insists on the cancellation of the decision of the ministerial committee on the transfer of the ownership of the highway from the state to the privatization fund. The bank wants its money back since the ownership changes and there is no guarantee that the new owner will assume the repayment.

Egnatia highway has a total length of 670 km and connects Igoumenitsa region to the west with Evros region to the east. It passes through Thesprotia, Evros, Thesprotia, Ioannina, Grevena, Kozani, Imatia, Thessaloniki, Kavala, Xanthi, Rodopi to Evros and it is one of the most important national thoroughfares. So far the construction of Egnatia with its vertical axis has cost Greece around six billion euro, Ethnos reports.

The employees’ union at the company that manages the highway also oppose the privatization. They rely on the existing legal framework under which a public company with limited liability owns the highway. A ministerial decision cannot stipulate the transfer of ownership but the sale of the owning company ("Egnatia Odos" S.A.) or expropriation can implement it.

Moreover, the construction of the Egnatia highway involved significant European funds. According to the existing legal framework in the European Union, the state is obliged to keep the highway under public control over a specified period of time after its construction, which has not yet expired, employees insist. The union adds that through the privatization of Egnatia, the new owner will take over only the assets of the company. Taxpayers will have to pay from their pockets the loans granted for the construction of the highway, which amount to 600 million euro. A copy of the report of the employees’ union was sent to the European Commission To Vima reports.

The "Roads" fund takes a stand against the state too. It has filed a claim for the cancellation of the transfer of the Halastra-Evzoni section to the privatization fund. The organization urges the Council of State to annul the actions triggered and to claim responsibility for violations of the property law by both the Ministry of Development and Infrastructure and the relevant minister.
In 2010, the government assigned through a public procurement the repair works for the modernization of the Halastra-Evzoni section to "Egnatia Odos" S.A. The "Roads" fund remained the owner of the section. Subsequently, the Egnatia highway and the Halastra-Evzoni section were transferred to the privatization fund without considering the fact that both road infrastructures had different owners. The "Roads" fund insists that the transfer was illegal and could not be implemented.


Tags: EconomyCompaniesEgnatiaPrivatizationPiraeus
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