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EU Court Annuls Aid to Belgian Postal Service

(CN) - Europe's second-highest court on Tuesday annulled the European Commission's decision to allow Belgium to inject its national postal service with 297.5 million euros.

In 2003, the commission decided to approve Belgium's plan to increase La Poste's capital, saying the boost in capital did not, in itself, constitute state aid.

Competitors Deutsche Post and DHL International sought annulment, claiming the commission failed to properly examine the plan before approving it.

The Court of First Instance granted their request, finding "serious difficulties" in the commission's preliminary examination procedure.

The court said the commission failed to compare the costs of running La Poste with the costs of other well-managed postal companies - "an appraisal which might have enabled it to find that the measures examined did not constitute State aid," the court ruled.

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