The European Commission has given the green light for the Romanian government to allocate €1.9 million in financial aid to its flag carrier TAROM to compensate for the financial loss incurred during the pandemic.
The approval was announced in a statement published on May 2, 2022.
The Commission found the amount of compensation was in line with EU rules on state aid to companies in difficulty as the airline was not able to operate its 14 routes between July 1 and December 31, 2020.
“The Commission assessed the measure under Article 107(2)(b) of the Treaty on the Functioning of the European Union (TFEU), which enables the Commission to approve State aid measures granted by the Member States to compensate specific companies or sectors for the damages directly caused by exceptional occurrences, such as the coronavirus outbreak,” the EU Commission statement reads.
“The Commission found that the Romanian measure will compensate for damage that is directly linked to the coronavirus pandemic. It also found that the measure is proportionate, as the compensation does not exceed what is necessary to make good the damage. On this basis, the Commission concluded that the Romanian measure is in line with EU State aid rules,” the statement continues.
The Otopeni-based airline was granted a €19.3 million Romanian-state guaranteed loan in October 2020 to cover financial damage. The loan was approved for the period between mid-March and late June 2020 as the airline experienced a significant decline in traffic and profitability at the time.