European Union recommends Penalties for Spain and Portugal over deficits

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While faulting Madrid and Lisbon for failing to take necessary measures to bring their budgets within limits, the European Commission will leave it to EU finance ministers to decide if they deserve to be penalized.

The European Commission, after weeks of pushing off the question of whether to penalize Spain and Portugal for breaching EU budget deficit rules, has made a decision - largely to let others decide.
On Thursday, it formally found Spain and Portugal in breach of the 3-percent deficit limit and forwarded this recommendation to EU finance ministers, who will decide whether penalties ought to be the result. The finance ministers are set to meet next Tuesday.

EU fiscal regulations require eurozone member countries to keep their budget deficits under three percent of their gross domestic product (GDP). There has been a long list of past breaches - France, Greece and Croatia also came in above the allowed level last year alone - though no country has yet to be fined for it.
The European Commission said it had moved to enforce the rules against Spain and Portugal for failing to initiate "effective action" to bring their deficits back under the required amount.