EU to take next step in disciplinary action against Italy this week

[BRUSSELS] European Union governments' delegates are set to back on Thursday the European Commission's disciplinary move against Italy over its debt, according to two EU sources and a document seen by Reuters.

The move is expected to be approved this week despite signals from Rome that it could tweak its fiscal targets for next year in the direction of EU requirements.

But in a more conciliatory note for Rome, the decision on formally starting disciplinary proceedings could be delayed until February, one official said citing a timeline foreseen under EU rules.

Italy is not compliant with EU regulations that require it to reduce its excessive debt, a draft document discussed on Monday by the EU governments' delegates sitting in the Economic and Financial Committee (EFC) said.

"Overall, the Committee is of the Opinion that (..) the debt criterion should be considered as not complied with," the draft document said.

"A debt-based EDP is thus warranted," the document concludes, referring to the EU disciplinary process known as the Excessive Deficit Procedure.

An EU official said the draft document was still subject to changes, but its conclusions were not contentious.

REUTERS