In a significant legal development, the EU General Court has ruled that the €7 billion and €4 billion Covid-19 State aid granted to Air France-KLM in 2020 and 2021, respectively, is illegal.
Ryanair, a major player in the aviation industry, has welcomed this ruling and is now urging the European Commission to take immediate action.
Ryanair’s Call for Action
Ryanair, in response to the court’s decision, calls on the European Commission to direct France to promptly recover this multi-billion euro illegal State aid package from Air France-KLM.
Additionally, Ryanair advocates for the imposition of adequate remedies to mitigate some of the damage to competition caused by this substantial State bailout.
Violation of EU Principles
A spokesperson for Ryanair emphasized the importance of the EU’s achievement in creating a true single market for air transport.
The European Commission’s approval of the French State aid to Air France-KLM, however, was deemed to go against fundamental principles of EU law, particularly the principle of non-discrimination based on nationality.
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The spokesperson stated, “Today’s judgments confirm that the Commission must act as a guardian of the level playing field in air transport and cannot sign-off discriminatory State aid issued by national governments.”
Triumph for Fair Competition
Ryanair sees the EU General Court’s intervention as a triumph for fair competition and consumers across the EU.
The rulings highlight the court’s stance on preventing discriminatory State aid that distorts the level playing field in the aviation industry.
Critique of the EU Commission’s Approach
The statement from Ryanair criticizes the European Commission’s approach to State aid during the Covid-19 crisis.
The airline asserts that Commission’s allegedly “spineless” approach allowed member states to provide open-ended financial support to their inefficient national carriers, compromising fair competition.
Ryanair points out that during the pandemic, over €40 billion in discriminatory State subsidies was given to EU flag carriers.
The court has previously ruled against similar cases involving SAS, Lufthansa, and certain Italian airlines, declaring billions of euros in aid unlawful.
Urgent Action Required
Despite previous rulings, Ryanair claims that the European Commission’s Directorate General for Competition has not taken sufficient action to force the recovery of unlawful aid.
The airline claims it has not imposed measures to remedy the damage to competition caused by governments favoring their local airlines over other EU carriers.
The Ryanair spokesperson concludes, “Today’s judgements underline the need for the European Commission to immediately act to recover these illegal State aid packages and order remedies to restore at least some of the damage done to competition.”
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