WRITTEN QUESTION E-0876/03 by Ioannis Marínos (PPE-DE) to the Commission. Rise in interest rates on loans in Greece.
Date: 2003-03-21
Institutions: European Parliament, Provisional data
Subjects: Greece, bank, consumer protection, euro area, interest, real estate credit

C 65 E/50

Official Journal of the European Union

EN

13.3.2004

Answer given by Mr Bolkestein on behalf of the Commission

(2 May 2003)

The Commission has been carefully examining the compatibility of the framework for the regulation
1.
and supervision of the Lloyd’s insurance market and has issued two press releases in connection with its
enquiries (1). The Commission has not yet completed its enquiries and is now examining the response of
the United Kingdom authorities to the supplementary letter of formal notice sent in January 2003.

2.
The objective of infringement proceedings under Community law is to establish or to restore the
compatibility of national law with Community law. The task of the Commission is now, therefore, to
examine the compatibility of the new regulatory and supervisory regime established for Lloyd’s under the
Financial Services and Markets Act 2000, not to rule on the compatibility or incompatibility of the
previous regime. Furthermore, the general case law of the European Court of Justice confirms that
infringement procedures under Article 226 of the EC Treaty aim solely to put an end to the failure to
comply with the Community law by a Member State, and not to record in abstracto that a failure existed
in the past.

According to the rule established by the Court of Justice in the Francovich case law (2), in the
3 and 4.
absence of Community legislation concerning reparation, it is for the internal legal order of each Member
State to designate the competent courts and lay down the detailed procedural rules for legal proceedings
intended fully to safeguard the rights which individuals derive from Community law. Three conditions
have to be met: the result prescribed by the Directive should entail the grant of rights to individuals;
it should be possible to identify the content of those rights on the basis of the provisions of the Directive;
and there should be a casual link between the breach (cid:1) which must be sufficiently serious (3) (cid:1) of the
State’s obligation and the loss and damage suffered by the injured parties. The notion of a sufficiently
serious breach is to be determined, together with all the other remaining conditions of the Francovich test,
solely by the national court deciding on the issue of damages.

(1) Commission Press Releases IP/01/1880 and IP/03/97.
(2) See judgement of the Court of 19 December 1991, Francovich and Bonifaci,

joined cases C-6/90 and C-9/90,

ECR(1991) p. I-5357.

(3) See judgement of the Court of 5 March 1996, Brasserie du Pêcheur and The Queen v. Secretary of State for

transport, ex parte: Factortame Ltd and others, joined cases C-46/93 and C-48/93, ECR(1996) p. I-1029.

(2004/C 65 E/049)

WRITTEN QUESTION E-0876/03

by Ioannis Marínos (PPE-DE) to the Commission

(21 March 2003)

Subject: Rise in interest rates on loans in Greece

Rumours of a general increase of 2 % on variable interest rates on loans have given rise to deep concern in
Greece. The Greek press reports that this situation is the exact opposite of what is happening in the other
countries in the euro zone (where falling interest rates is the trend) and that whereas the banks in Greece
offer between 1 % and 2 % interest on deposits, their lending rate for credit-card holders is 16 %, giving
Greece the highest interest-rate spread in the euro zone. The rise in interest rates on loans has caused
despair among consumers who have borrowed to buy a home, believing the government’s assurances that
‘interest rates will continue to fall’, something to which the New Democracy has drawn particular attention
as well as highlighting the lack of real competition between banks in Greece. As New Democracy’s
Coordinator of Economic Affairs, Mr Alogoskoufis, has pointed out ‘in the Greek banking system, over half
the governors of banks are appointed by the government’. The concern in Greece is that the economy will
lead to a general rise in interest rates having a palpable impact on consumers and the pace of economic
development. In a public statement on the matter, the Association of Consumers and Borrowers of Greece
stated that, according to figures released by the European Central Bank (ECB), average interest rates on
consumer credit in Greece are three percentage points higher than in the other countries in the euro zone.
The Governor of the Bank of Greece, Mr Garganas, has pointed out that the recently adopted law on
additional
interest rate charges contains numerous ambiguities and the banks are therefore failing to
implement it.

13.3.2004

EN

Official Journal of the European Union

C 65 E/51

What are the Commission’s views on the rise in interest rates on loans in Greece? Why are interest rates in
Greece on the increase when at the same time the exact opposite trend can be observed in the other
countries in the euro zone? Has the Commission received any information from the Greek authorities
concerning the additional interest rate charges, which have spelled financial ruin for so many in Greek
business and professional circles?

Answer given by Mr Solbes Mira on behalf of the Commission

(7 May 2003)

Within a context of largely integrated financial markets in the Community, a single currency and single
monetary policy, conditions in these markets are increasingly competitive ones. However,
individual
institutions, whilst being influenced by common factors such as a change in the market borrowing/lending
rate, may still decide the conditions applied to their customers according to their own individual strategy,
balance sheet and other considerations.
financial
institutions may decide to give more weight to risk considerations than otherwise. Interest rate spreads in
some other countries have also gone up recently.

in times of weak economic growth,

In particular,

Although there have been from time to time ad-hoc investigations into alleged collusion or co-ordination
between institutions concerning conditions applied to customers, no evidence has so far been found of
collusion or of an abuse of a dominant position in Greece. The Greek competition authority, the Hellenic
Competition Commission, is well placed to monitor competition in the Greek banking market and we will
forward the concern expressed to that authority.

(2004/C 65 E/050)

WRITTEN QUESTION E-0881/03

by Roberta Angelilli (UEN) to the Commission

(21 March 2003)

Subject: Measures to support the family (cid:1) proposal by Lazio Regional Council to build and restructure

buildings for children

Following the extraordinary meeting of Lazio Regional Council, chaired by the Chairman Francesco
Storace and held in Brussels on 21 November 2002 in the presence of the President of the Commission
Romano Prodi, it was decided to ask the Commission to promote Community measures to funds projects
aimed at building new facilities for young children.

The rise in the rate of unemployment among women and marriage breakdown are causing rapid changes
in family structure and the situation of minors. Offering families efficient social and educational facilities is
a way of safeguarding jobs and equal employment opportunities for women, who are still the family
members most involved in looking after children and bringing them up. Furthermore, the rising cost of
living is preventing young couples from settling down and starting a family, thereby causing the fall in the
population which has been a subject of debate in Europe for years. For this reason a systematic policy
needs to be launched, not least in view of the serious shortage of services for young children in Italy and
the other Member States. A comparative study, commissioned by the British Government and carried out
by the University of York in 2002, of measures for the benefit of children in the 15 countries of the Union
and in Norway, the United States, Australia, Canada, Israel, Japan and New Zealand, showed that in some
Member States the standards of assistance are unsatisfactory as regards both the granting of benefits and
the provision of facilities.

In its answer of 15 July 2002 to Written Question E-1551/02 (1) of 3 June 2002 the Commission said it
was interested in family issues, although there was no legal basis conferring any specific competence on
the European Union in this sphere. Article 308 of the Treaty assigns power to adopt Community measures