EC failure to investigate
Ryanair Holdings PLC
10 July 2007
Ryanair To Sue European Commission for Failure to Investigate
State Aid Complaints
Ryanair, Europe's largest low fares airline, today (Tuesday, 10th July 2007)
announced that it will sue the European Commission in the European Courts for
its repeated failure to take action on a number of State Aid complaints
involving Air France, Lufthansa, Alitalia and Olympic Airways, which were
submitted to the Commission over a year ago. These complaints involved hundreds
of millions of Euro in illegal state aids being granted by the French, German,
Italian and Greek Governments to subsidise their flag carrier airlines. Although
Ryanair has called on the Commission several times to investigate these claims,
the Commission has failed to do so.
Confirming that Ryanair is in the process of submitting a complaint against the
Commission to the European Courts, Ryanair's Head of Regulatory Affairs, Jim
Callaghan, said:
'This is another example of the Commission's twin track approach to state
aid. On one hand they refuse to take action against serious violations of
the state aid rules by national Governments to protect their flag carrier
airlines like Air France, Lufthansa, Alitalia and Olympic, while at the same
time they launch bogus investigations against small regional and secondary
airports like Charleroi. The foolishness of the Commission's Charleroi
decision is that Ryanair now actually has a lower cost base in Charleroi.
'The Commission has failed to take any action against the following blatant
abuses of the state aid rules:
•The French Government's discounting of domestic airport fees, which
amounts to an illegal state aid to Air France of approximately €1bln. over
the past 7 years. Meanwhile, the Commission is pursuing tiny Malta for a
similar discounting of its domestic airport charges.
•The German Government has allowed state owned Munich Airport to rack up
losses of over €50m. p.a. on a new terminal built exclusively for Lufthansa.
These losses are a massive subsidy to Lufthansa, the only occupant of this
terminal. Meanwhile, the Commission is going after small regional and
secondary airports like Charleroi that are offering competitive deals to
airlines, like Ryanair, who are prepared to deliver huge traffic growth to
these otherwise underutilised airports.
•The Italian and Greek Governments have repeatedly given massive
injections of state aid into their terminally ill flag carrier airlines,
Alitalia and Olympic. The Commission has rubberstamped multi-billion bailout
packages for Alitalia and the Italian Government is currently planning to
write off hundreds of millions in losses at the national airline in order to
make it attractive for sale. Meanwhile, the European Commission blocked
Ryanair from taking over the small, loss making regional Irish airline, Aer
Lingus. Moreover, the Greek Government has never repaid the multi-millions
in illegal state aid granted to Olympic.
'It appears as always that the Commission applies one rule for the high fare
flag carrier airlines and state owned primary airports, but a different one
for low cost airlines like Ryanair and the numerous regional and secondary
airports that are offering competition and lower fares to the travelling
public. The European Commission is more concerned with protecting
inefficient flag carrier airlines and hub airports than it is with actually
promoting competition and the consumer interest.
'Ryanair is left with no alternative but to challenge the Commission's
failure to investigate these unlawful state aid abuses in the European
Courts. Ryanair is confident that the European Court will take the
Commission to task for their failure to fairly enforce the state aid rules
against national Governments who continue to protect their inefficient flag
carrier airlines.
'It is time that the European Commission stops this twin track approach to
enforcing the state aid rules. The same rules should be fairly applied to
all airlines, and an end put to the unlawful state aid to the flag
carriers'.
Ends. Tuesday, 10th July 2007
For reference: Peter Sherrard - Ryanair
Tel: +353-1-8121228
Pauline McAlester - Murray Consultants
Tel: +353-1-4980300
This information is provided by RNS
The company news service from the London Stock Exchange
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