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Italian government to detail Alitalia loan terms to EU

24 April 2008, 18:15 CET

(ROME) - The outgoing Italian government said Thursday it would provide details of its emergency loan for the near bankrupt national airline Alitalia to the European Commission within 10 working days.

"Regarding the letter received today from the European Commission on the 300-million-euro (480-million-dollar) loan, (Prime Minister Romano Prodi's government) confirms that it will provide the requested information within the 10 working days specified in the letter," the government said in a communique.

The EU executive had voiced doubts on Thursday that the loan was being made on commercial terms, raising the prospect that regulators may block the deal.

"Italy maintains that the measures are not state aid because the loan is being made available on commercial terms," Commission spokesman Michele Cercone said in Brussels.

"We want to understand if this is a (purely) commercial operation or has elements of state aid," he added.

Italy is currently banned from offering state aid to the ailing airline because of past bailouts and could be forced to recover the money if it is deemed to be illegal state aid.

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