More Time Needed to Reclaim State Aid to DPWN

The German government has asked the European Union for more time to come up with a plan for reclaiming at least EUR572 million in state aid to Deutsche Post AG (G.DPW), the finance ministry said Friday. The government has asked the E.U. Commission, the E.U.’s executive branch, to delay the deadline for the plan until Oct. 1, finance ministry spokesman Thomas Gerhardt said. The Commission set an Aug. 22 deadline for the plan when it ruled in mid-June that the state aid to the partially privatized mail company was illegal. It has yet to respond to the government’s request, Gerhardt said. The finance ministry fully expects the request to be accepted, Gerhardt added, saying it was based simply on understaffing at the ministry during the summer holidays. On June 19, the Commission ordered Deutsche Post to repay EUR572 million to the German government on the grounds the company used profits from a guaranteed monopoly letter business to undercut parcel-sector rivals between 1994 and 1998. In response, Deutsche Post said it would take a EUR850 million one-off provision in its accounts, including accrued interest. The repayment amount will be between EUR572 million and EUR820 million, according to the finance ministry’s Gerhardt. Though it took the one-off provision, Deutsche Post also pledged to appeal against the E.U. ruling at the European Court of Justice in Luxembourg.