Ryanair, the Irish low-cost airline, has lost its legal challenge against state aid received by Brussels Airlines, a subsidiary of Lufthansa. The European Union court ruled on Wednesday that the financial assistance provided to Brussels Airlines in the form of loans and recapitalization during the COVID-19 pandemic was compatible with the EU's internal market regulations.
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This ruling implies that Ryanair's legal challenge against this aid has been unsuccessful. Brussels Airlines expressed its satisfaction with the court’s decision in an emailed statement released on the same day. The Belgian airline had received €290 million from the Belgian State during the pandemic. This financial assistance was deemed necessary to help the airline navigate through the unprecedented crisis caused by the pandemic.
Ryanair had lodged a complaint against this state aid, arguing that it was discriminatory and favored Brussels Airlines over other EU airlines. However, the Court of Justice of the European Union rejected Ryanair’s complaint, thereby upholding the legality of the state aid provided to Brussels Airlines.
This ruling is significant as it sets a precedent for state aid provided to airlines during times of crisis. It underscores that such financial assistance, when deemed necessary and provided in accordance with EU regulations, is lawful and does not constitute unfair competition. The decision comes as a setback for Ryanair, which has been vocal in its criticism of state aid provided to other airlines. However, it provides much-needed clarity and guidance on the issue of state aid to airlines, particularly in times of unprecedented crises such as the COVID-19 pandemic.
