Ryanair welcomes legal victory against Air France-KLM state bailouts

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Ryanair has welcomed a judgment made by the European General Court to overturn a decision to allow billions of euros in state aid to be paid to the Air France-KLM Group during the height of the COVID-19 pandemic. 

The Court ruled in Ryanair’s favor following an appeal being lodged by the low-cost carrier. Specifically, Ryanair objected to the approval of a €7 billion ($7.7bn) COVID-19 support grant to Air France-KLM in 2020 which was followed by a further €4 billion ($4.4bn) in 2021 with both payments being cleared by the European Commission.  

Ryanair had called on the European Commission to order France to recover the state aid package from Air France-KLM and additionally to impose “adequate remedies to repair at least some of the damage to competition done by this massive state bailout”. 

The General Court sitting in Luxembourg, ruled in favor of the objection, ruling that the state aid was indeed illegal, as alleged by Ryanair. Handing down its judgment, the Court stated: “Where there are grounds to fear the effects on competition of an accumulation of state aid within the same group, the onus is on the Commission to exercise particular vigilance in examining the links between the companies belonging to that group.” 

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“[This decision is] one of the EU’s greatest achievements and aids the creation of a true single market for air transport.” said a Ryanair spokesperson. “The European Commission’s approval of the French 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.”  

“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. The court’s intervention is a triumph for fair competition and consumers across the EU,” the spokesperson added. 

“Today’s judgments 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. 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,” added Ryanair commenting on the ruling. 

An appeal, should there be one made by Air France-KLM, must be limited to points of law only, and may be brought before the higher EU Court of Justice against the decision of the General Court within two months and 10 days of notification of the decision.  

The airline group is yet to decide whether to appeal or accept this latest decision. 

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