The European Commission said the investigation was triggered by a complaint.
The EU probe will focus on a 149-million-euro ($164.4 million) payment made in December last year to compensate ELTA for its universal service obligation between 2013 to 2018.
It will also cover a 100-million-euro capital injection by Greece into ELTA’s share capital last December and the company’s exemption from value added taxes since 2000.
“At this stage, based on its preliminary assessment, the Commission has doubts on whether certain measures in favour of ELTA are in line with EU State aid rules,” the EU executive said in a statement.
The EU competition enforcer can order EU governments to recover state aid if this is found to be illegal.