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PR(03)34: The EFTA Surveillance Authority authorises the prolongation of governmental “war insurance” in support of air carriers and airports in Iceland and Norway


In two decisions taken today, the EFTA Surveillance Authority decided not to raise objections to the prolongation of ‘war insurance’ schemes in Iceland and Norway.

Given that the commercial insurance market did not return to normal after the first month following the terrorist attacks of 11 September 2001, the Icelandic and Norwegian Governments decided on various occasions to prolong the Governmental ‘war insurance’ schemes. In earlier decisions from 2001 and 2002, the Authority has authorised Icelandic and Norwegian ‘war insurance’ schemes and their prolongations. The present decisions deal with the prolongations covering the period between 1 June to 31 August 2002 (Iceland) and 1 June and 30 June 2002 (Norway), respectively. Both Iceland and Norway ended their support schemes after these dates.

In assessing the compatibilityof these measures, the Authority applied Article 61 (2)(b) of the EEA Agreement, which allows for the possibility to grant “aid to make good the damage caused by … exceptional occurrences.” In this respect, the Authority took into account the criteria which it had applied in its earlier decisions and which are based on various EC Commission Communications. The last EC Communication on this matter[1] allowed the EC Member States to continue the ‘war insurance’ scheme until 31 October 2002. The Authority verified that the Governmental ‘war insurance’ schemes were limited to remedying the withdrawal of such insurance cover by the commercial insurance market and that the schemes did not place the air carriers in a position which was more favorable than before the events of 11 September 2001. As the insured operators paid a premium, according to principles established within the European Community and in conformity with previous decisions by the Authority, the Authority declared the prolongations compatible with the EEA State aid rules.

For further information, please contact Mr. Amund Utne, Director, tel. (32)(0)2 286 18 50 or Ms. Annette Kliemann, Officer, tel. (32)(0)2 286 18 52.

[1]Insurance in the Air Transport sector following the terrorist attacks of 11 September 2001 in the United States, of 2 July 2002, COM (2002) 320 final.

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