EU court rejects Ryanair lawsuit against airline state aid

The budget carrier had challenged national bailout schemes for rivals Air France and SAS in their respective home countries. The fight could still go further.

Ryanair on Wednesday lost a legal fight in the European Union’s second court against state aid being granted to pandemic-hit rivals Air France and Sweden ‘s SAS through national schemes.

Judges at the EU’s General Court in Luxembourg backed EU competition regulators who had allowed the support under loosened rules.

What was Ryanair’s complaint?

The state aid rules of the European Commission — the defendant in the case —were loosened at the start of the pandemic.

National governments offered more than 3 trillion euros ($3.65 trillion) in aid to companies across the 27-member bloc.

The General Court was asked to assess a French scheme allowing airlines to defer certain aeronautical taxes, and to rule on Sweden’s loan guarantee scheme for airlines.

Ryanair has pursued a legal campaign across Europe to stop the bailouts, arguing the state aid gives an unfair advantage to prestigious national flag carriers.

What did the court say?

“This aid scheme is appropriate to remedy the economic damage caused by the COVID-19 pandemic and does not constitute discrimination,” the court said, referring to the French scheme.

It also said the Swedish scheme was compatible with EU laws. The court said that the limitation of the loan guarantee scheme “is appropriate for achieving the objective of remedying the serious disturbance in Sweden’s economy.”

What can the Irish airline do now?

The losses for Ryanair were just a first round, and the cases could now moving to the higher European Court of Justice.

Ryanair — the biggest airline in Europe when it comes to passenger numbers — is also seeking to reverse Germany’s massive bailout of Lufthansa.

It also has lodged proceedings against the commission over the Netherlands’ KLM, Austrian Airlines and Portugal’s TAP, among others.