EU Approves State Aid for Faster Broadband in Greece

European Union

The European Commission has approved under EU State aid rules a voucher scheme to support the take-up in Greece of broadband services with download speeds of at least 100 Megabit per second. The measure will contribute to reducing the digital divide while limiting distortions of competition.

The Greek authorities aim to increase the number of consumers using “Superfast Broadband Services”, which are defined by Greece as broadband services ensuring download speeds of at least 100 Megabits per second (Mbps), readily up-gradable to 1 Gigabit per second (Gbps).

Commissioner Margrethe Vestager, in charge of competition policy, said: “The Greek Superfast broadband project aims to increase the number of consumers adopting the Superfast broadband services. The voucher scheme will help more people use higher speed broadband services in areas where suitable infrastructure is available but insufficiently used. The scheme will contribute to bridging the longstanding digital divide in Greece, in line with the objectives of the EU’s Digital Single Market, while ensuring that competition is not unduly distorted.”

Infrastructure able to provide these broadband services is already available in Greece, but the take-up is very low.The vouchers will support increased take-up by covering part of the set-up costs and of the monthly fee for a maximum of 24 months. Users will be able to activate the vouchers until 31 March 2020.

Greece notified the support measure for assessment by the Commission under State aid rules. The Commission found that even though the scheme is mainly aimed at consumers, it amounts to State aid in favour of telecommunication services providers, who will be able to offer such services over existing broadband infrastructures. Therefore, the Commission assessed the measure under State aid rules, in particular under Article 107(3)(c) TFEU

The Commission has ensured that Greece will take adequate steps to avoid any undue distortion of competition and in particular will monitor that the scheme is not used to merely replace existing subscriptions to other high speed broadband services.

The scheme will be accompanied by a detailed evaluation to assess its impact. The results of this evaluation will be submitted by Greece to the Commission by December 2021.

On this basis, the Commission concluded that the scheme is in line with State aid rules and contributes to the EU strategic objectives set out in the Digital Agenda for Europe and in the Communication “Towards a European Gigabit Society”.

Broadband connectivity is of strategic importance for European growth and innovation in all sectors of the economy, as well as for social and territorial cohesion. The Digital Agenda for Europe acknowledges the socio-economic benefits of broadband and sets targets for broadband development in Europe, including that 50% or more of European households should subscribe to internet connections above 100 Mbps.

The Digital Agenda for Europe was complemented in 2016 by the Gigabit Society Communication, which defines connectivity objectives to be achieved by 2025, where the development of very high capacity networks able to provide download speeds of at least 100 Mbps, upgrade-able to 1 Gbps, should enable the widespread use of products, services and applications in the Digital Single Market.

In the broadband sector, demand-side measures may complement supply-side measures aimed at infrastructure roll-out by supporting the take-up of broadband services over the rolled-out infrastructure. Among the former, voucher schemes may be used to support subscriptions of broadband services by reducing the cost for end-users.

According to the Digital Economy and Society Index 2018 (DESI 2018), the take up of high speed broadband services in Greece is the lowest in the EU. According to Greece, one of the main reasons is the price of high fixed broadband, which is significantly higher than the EU average.