Ryanair loses final appeal against €150m aid package to Austrian Airlines
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The EU’s highest court has dismissed an action taken by Ryanair challenging an Austrian government aid package to rival airline Austrian Airlines — which is part of the Lufthansa Group.
The challenge centred around a June 2020 Austrian aid measure to Austrian Airlines which was in the form of a subordinated loan, convertible into a grant, of €150m. This was intended to compensate the airline for the damage resulting from the cancellation or rescheduling of its flights owing to the covid pandemic.
This was approved by the European Commission.
Ryanair challenged this to the General Court of the European Union, but failed, and its subsequent appeal went before the EU’s Court of Justice.
In its ruling on Monday, the EU’s Court of Justice dismissed Ryanair’s case, saying that member states are allowed to “reserve to a single undertaking aid that is intended to make good the damage caused by an exceptional occurrence”.
The court said that Ryanair did not establish that the aid package, because it only benefited Austrian Airlines, constituted “an obstacle to the freedom of establishment and to the freedom to provide services”.
“They failed to demonstrate that that aid produced restrictive effects which went beyond those inherent in State aid,” the court stated.
"The choice of Austrian Airlines as the sole beneficiary of the aid at issue is inherent in the selective nature of that aid."
In a statement, Ryanair noted the judgment, saying that other cases concerning State aid to airlines during the pandemic were deemed unlawful. It cited cases including Lufthansa, Air France, KLM, and Scandinavian Airlines.
It said the European Commission’s Directorate General for Competition has still not recovered "unlawful aid" from numerous countries who favoured their local airlines in breach of EU law.