Ryanair has welcomed the further ruling by the EU General Court regarding the €3.4bn Covid-19 State aid granted by the Netherlands to Air France-KLM in 2020.
This ruling marks the second time the aid package has been deemed illegal by the court, emphasizing significant concerns over fair competition within the European aviation market.
Ryanair has now called on the European Commission to order the Netherlands to immediately recover this multi-billion euro illegal State aid package from Air France-KLM and impose adequate remedies.
Background and Context
The decision by the EU General Court comes after the European Commission’s approval of the Dutch State aid to Air France-KLM.
This was contested by Ryanair due to its potential to undermine the principles of EU law, particularly the principle of non-discrimination based on nationality.
Ryanair’s stance pointed to the importance of upholding a level playing field in air transport to foster fair competition and benefit consumers across the EU.
Implications of the Ruling
Today’s EU court ruling not only highlights the court’s role in safeguarding fair competition but also raises questions about the European Commission’s approach to State aid during the Covid-19 crisis.
With over €40bn in discriminatory State subsidies provided to EU flag carriers during the pandemic, concerns over inefficiency and the distortion of competition have been brought to the forefront.
Ryanair’s spokesperson has criticized the European Commission’s handling of State aid, describing it as “spineless” and emphasizing the need for immediate action to address the unlawful aid packages received by various airlines.
“The European Commission’s approval of the Dutch State aid to Air France-KLM went against the fundamental principles of EU law, like the principle of non-discrimination on the basis of nationality,” said Ryanair’s spokesperson.
“The European Commission’s Directorate General for Competition has still not acted to force recovery of the unlawful aid, nor has it imposed any measures to remedy the damage to competition caused by the Swedish, Danish, German, French, and Italian governments favouring their local airlines over other EU airlines, in breach of EU law.”
The failure to enforce recovery of these aids and implement measures to remedy the damage to competition poses long-term risks to consumer welfare and market efficiency, according to Ryanair.
“Undistorted competition eliminates inefficiency and benefits consumers through low fares and choice. Unjustified subsidies, on the other hand, encourage ineffectiveness and will harm consumers for decades to come,” the airline’s spokesperson concluded.
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