Government of the Azores presents Brussels solution to return SATA capital increases

The Azores regional finance secretary announced this Friday that he will possibly move forward "at the beginning of the week", with Brussels, with the solution to return the "illegal" capital increases carried out at SATA, of 73 million euros.

“As soon as the European Union informed us that the aid is illegal and that it will have to be returned, we are dealing with its return and not creating additional problems. The main problem is the restructuring ”, declared Bastos e Silva.

The government official said that "the meeting is scheduled to start at the beginning of the week" with the community bodies where he will present the solution to return the capital increases carried out without the European Commission's knowledge, by the previous socialist government.

The regional secretary of Finance, Planning and Public Administration, as well as that of Transport, Tourism and Energy, Mário Mota Borges, met this Friday, in Ponta Delgada, with the Board of Directors of the SATA group.

Bastos e Silva said that the restructuring plan for the Azorean air operator, which is the company's responsibility, is a “well-crafted and very logical version” that will soon be submitted to the Government Council and the Azorean parliament before being sent to Brussels .

The holder of the Finance portfolio admitted that despite the consensus in the region on the restructuring plan, these processes “are difficult to negotiate” and “the problems will arise but in negotiation with the European authorities”, with the intention of “starting as soon as possible possible to overcome this phase and put SATA on a new path ”.

Asked if the design of financial recovery will be different from TAP, since both companies suffer from the same problems, Bastos e Silva considered that the “financial situation in its proportion is also very worrying, but what happens differently is that the the location of the Azores as an outermost region and the nature of air transport is quite different from the national one ”.

"These differences are relevant and also make the European Union look at the region and its company with different eyes than it looked", stressed the minister.

On December 10, 2020, the Finance Secretary of the Government of the Azores reiterated that it was “for granted” that the SATA carrier had to return to the region 73 million euros resulting from the community investigation into three capital increases in the company.

“It was communicated to us verbally, as it corresponds to the format of a teleconference, and it was communicated to us in a collaborative manner, which is a given that, in the investigation of the aids that constituted SATA's capital increases (…), because they did not previously communicated to Brussels, constitute illegal aid and have to be returned ”, declared Bastos e Silva, speaking to journalists in the city of Horta.

In mid-August, the European Commission gave 'green light' to a Portuguese state aid of 133 million euros to the Azorean air carrier SATA, but opened an investigation to assess compliance with community standards in three public supports for the company.

SATA's financial difficulties have persisted since at least 2014, when the airline wholly owned by the Autonomous Region of the Azores began to record losses, meanwhile aggravated by the covid-19 pandemic.

It was due to these difficulties that the Autonomous Region of the Azores approved, since 2017, three capital increases in the airline, to fill liquidity shortages.

It is these public supports that Brussels investigated and defined as illegal, declared the regional secretary of the new Azorean executive with the supervision of Finance.

Subsequently, a source from the community executive had told the agency Lusa that the investigation open to aid to the SATA carrier “continues”.

Asked about the announcement by the Azorean Government, Brussels stressed that the investigation into “some public support for SATA continues”.

“At this stage, we were unable to predict when [it will be revealed] and what the outcome of the investigation will be. According to normal practice, the Commission is in contact with Portugal and other interested parties in the context of its ongoing investigation ”, continued the same source.

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