EC allows 26 mln euro state aid for Bulgarian Posts

The financial rescue measure will take the form of a state loan, the Commission said in a statement on Tuesday.

Bulgaria's caretaker government announced in March that it sought the Commission's green light for the loan as part of a recovery plan for the state-owned postal, courier and pension payment services company. Bulgarian Posts has a network of 2,973 post offices across the country, with 8,500 staff. High inflation and rising operating costs were cited as reasons for its current difficulties.

The Commission added it had approved the measure under state aid rules, more specifically under its guidelines on rescue and restructuring, which allows member states to provide financial support for troubled companies on condition that the state aid measures are limited in time and scope.

In the case of Bulgarian Posts, the loan will enable the company to meet immediate liquidity needs until October so as to ensure the uninterrupted delivery of postal and pension payment services. After that, Bulgaria has committed to make sure that the six-month loan is either reimbursed or that Bulgarian Posts submits a restructuring plan that guarantees long-term viability, the EU executive noted. The possible restructuring plan would need to be approved by the Commission.

(1 euro = 1.95583 levs)