EU Court Declares Dutch State Aid to Air France-KLM Illegal, Ryanair Calls for Immediate Action
In a landmark ruling on February 7th, the EU General Court declared the €3.4 billion state aid granted by the Netherlands to Air France-KLM in 2020 as illegal. This decision marks the second occasion the aid package has been ruled unlawful by the Court, highlighting the European Commission's failure to address errors identified in its initial approval. This is the fourth instance of Covid-19 related state aid to Air France-KLM being deemed illegal by the Court, underscoring ongoing concerns about competition and fairness in the European air transport sector.
Ryanair, a leading competitor in the industry, has voiced its approval of the Court's decision, urging the European Commission to enforce the immediate recovery of the illegal aid from Air France-KLM. The airline emphasizes the need for remedies to mitigate the competitive damage inflicted by this substantial state bailout.
According to Ryanair's spokesperson, the Court's ruling is a victory for the principles of fair competition and consumer rights across the European Union. The spokesperson criticized the European Commission's lenient stance on state aid during the Covid-19 crisis, which permitted member states to disproportionately support their national carriers, often referred to as "zombie flag carriers," at the expense of a competitive market landscape.
The pandemic saw over €40 billion in discriminatory state subsidies allocated to EU flag carriers, with previous Court rulings also identifying unlawful aid to airlines such as SAS, Lufthansa, and various Italian carriers. These decisions highlight a systemic issue within the EU's approach to state aid, where national interests have overshadowed the broader objective of maintaining a level playing field in the aviation industry.
Ryanair's statement underscores the broader implications of the Court's ruling, calling for the European Commission's Directorate General for Competition to take decisive action. The airline advocates for the recovery of unlawful aid and the implementation of measures to repair the competitive landscape, stressing the importance of adhering to EU law and ensuring fair treatment for all airlines, irrespective of nationality.
This ruling not only challenges the legality of state interventions in the aviation sector but also sets a precedent for the treatment of state aid within the EU, advocating for a more balanced and competitive market that benefits consumers and airlines alike.