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The government has talked about Malev - spokesman

The government has discussed Hungarian airline Malev, Government Spokesman Andras Giro-Szasz said on Wednesday, without adding further details.

Last week, the European Commission said it ordered Hungary to recover illegal state aid given to national airline Malev between 2007 and 2010.

"The European Commission found that financing granted to Hungarian flag carrier Malev between 2007 and 2010 in the context of its privatisation and renationalisation constitutes illegal state aid, as Malev would not have been able to obtain similar financing from the market on the terms conceded by the Hungarian authorities. Hungary now needs to recover the unlawful aid from the beneficiary," the Commission said.

The Commission noted that troubled companies may receive sate aid under strict conditions but the measures in favour of Malev did not meet these criteria "because Malev could not demonstrate how it would become viable again under its current business model".

The National Development Ministry acknowledged the Commission’s decision in a statement and said the government was expected to discuss proposals on Malev’s future at a cabinet meeting on January 16.

The ministry said several possible courses of action had been prepared and their content would now be brought up to date with the Commission’s decision.

The ministry said that keeping a Budapest-based national carrier in the interest of the national economy remained a priority. To achieve this the continued operation of Malev is necessary, it added.

Authorities will take all necessary steps to recover the state aid, the ministry said, adding that it would draw up a package of measures, together with the government, to ease the situation in the coming weeks.