EU Orders Portugal To Recover €450M Grant To Bank

Law360, New York (July 20, 2010, 5:15 PM EDT) -- The European Commission has ordered Portugal to recover €450 million ($580 million) in state aid the country granted in 2008 to Banco Privado Portugues, saying the loan guarantee was in violation of European state aid policies.

In a statement issued Tuesday, the European Commission ordered Portugal to claw back the grant, saying Portugal's guarantee on the loan was “illegal and incompatible” state aid because regulators had yet to receive any restructuring plan for BPP as required under state aid rules.

In addition, Europe's top competition regulator...
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