Greek MEP Elena Kountoura (The Left) has asked the European Commission whether it plans to propose specific European compensation mechanisms to address the permanent additional costs of island living, particularly in transport, energy and public services. In a written parliamentary question submitted on 9 June 2026, Kountoura argues that the structural handicaps recognised by Article 174 TFEU constitute a market failure justifying permanent compensatory mechanisms, fiscal instruments such as reduced VAT and transport equivalent schemes, and adapted state aid rules for all islands.
The question follows a previous inquiry (E-000173/2026) in which the Commission replied that it was not proposing a separate financial mechanism or measures exclusively for island connectivity. Kountoura now presses the Commission on three concrete asks: first, whether it will propose specific compensation mechanisms covering transport, energy and essential public services; second, whether it plans to adapt the EU state aid framework — including the de minimis rule, the General Block Exemption Regulation and regional aid rules — to account for permanent structural handicaps and increased operating costs of island economies; and third, whether it intends to introduce measures to offset the impact of decarbonisation policies for air and maritime transport on island regions, such as protecting connectivity, maintaining public service obligations and using ETS revenues to support island transport systems.
The question signals a push for EU-level intervention to address what Kountoura describes as a structural market failure, rather than leaving islands to rely on general EU funds or national measures. The Commission is expected to reply within approximately six weeks, and its answer will indicate whether it is willing to move beyond its previous position and consider dedicated financial instruments or regulatory adaptations for Europe's islands.
Stakeholder impact: Island residents and businesses would benefit from lower transport costs and better access to services if compensatory mechanisms are adopted. EU producers on islands would gain from reduced operating costs and improved market access. National governments of island states (e.g., Greece, Malta, Cyprus) would face pressure to align state aid rules with any new EU framework. The transport and energy sectors would be affected by potential new subsidies or regulatory changes, while decarbonisation policies could see their impact on islands mitigated through compensatory measures.