Council Decision (EU) 2017/1225 of 16 June 2017 abrogating Decision 2010/288/EU on the existence of an excessive deficit in Portugal

• Published date: 07 July 2017
• Subject Matter: Economic and Monetary Union
• Official Gazette Publication: Official Journal of the European Union, L 174, 7 July 2017

7.7.2017 EN Official Journal of the European Union L 174/19

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COUNCIL DECISION (EU) 2017/1225

of 16 June 2017

abrogating Decision 2010/288/EU on the existence of an excessive deficit in Portugal

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article 126(12) thereof,

Having regard to the recommendation from the European Commission,

Whereas:

(1) On 2 December 2009, following a recommendation from the Commission, the Council decided, by Decision 2010/288/EU (1), in accordance with Article 126(6) of the Treaty, that an excessive deficit existed in Portugal. The Council noted that the general government deficit planned for 2009 was 5,9 % of GDP, thus above the 3 %-of-GDP Treaty reference value. The general government gross debt (which had been above the 60 %-of-GDP Treaty reference value since 2005) was foreseen to reach 74,5 % of GDP in 2009.

(2) On 2 December 2009, in accordance with Article 126(7) of the Treaty and Article 3(4) of Council Regulation (EC) No 1467/97 (2), the Council, based on a recommendation from the Commission, addressed a Recommendation to Portugal with a view to bringing the excessive deficit situation to an end by 2013 at the latest. The Council also set a deadline of 2 June 2010 for effective action to be taken.

(3) Following the request by the Portuguese authorities for financial assistance from the Union, the Member States whose currency is the euro and the International Monetary Fund (IMF), the Council granted financial assistance to Portugal (3). The Memorandum of Understanding on Specific Economic Policy Conditionality between the Commission and the Portuguese authorities was signed on 17 May 2011. Thereafter the Council addressed two new Recommendations to Portugal on 9 October 2012 and 21 June 2013 on the basis of Article 126(7) of the Treaty, which extended the deadline for correcting the excessive deficit to 2014 and 2015, respectively. In both cases, the Council considered that Portugal had taken effective action, but unexpected adverse economic events with major unfavourable consequences for government finances had occurred. In line with Article 10(2)(a) of Regulation (EU) No 472/2013 of the European Parliament and of the Council (4), Portugal was exempted from a separate reporting requirement under the excessive deficit procedure and reported in the framework of its macroeconomic adjustment programme (5).

(4) In accordance with Article 126(8) of the Treaty, the Council decided, on 12 July 2016, that Portugal had not taken effective action in response to the Council Recommendation of 21 June 2013. On 8 August 2016, the Council adopted a decision in accordance with Article 126(9) of the Treaty giving notice to Portugal to take measures for the deficit reduction judged necessary in order to remedy the situation of excessive deficit, thereby setting a new deadline for correction by 2016. The Council also set a deadline of 15 October 2016 for effective action to be taken.

(5) On 16 November 2016, the Commission concluded that Portugal had taken effective action in compliance

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