Brussels, 18/02/2014 (Agence Europe) - The European Commission unveiled new guidelines on Thursday 20 February for state aid for airports and airlines.
These will be formally adopted at the end of March and will replace the 2005 guidelines. They adjust the state aid rules in line with changes in the industry over the past few years, which have seen a doubling of the number of airports and the burgeoning of low-cost airlines, which now account for 46% of the market in the EU. The Commission's aim is to ensure good connections between regions and the mobility of European citizens, while minimising distortions of competition in the single market, overcapacity in airport infrastructure and airports shopping around for regional aid.
The European Commission adopted today new guidelines on how member states can support airports and airlines in line with EU state aid rules. They are part of the Commission's State Aid Modernisation (SAM) strategy, which aims at fostering growth in the single market by encouraging more effective aid measures and focusing the Commission's scrutiny on cases with the biggest impact on competition
The use of public money is only allowed if it provides genuine value-added in the form of growth or meeting recognised needs if there is a genuine market failure. It must not be used to compensate for running losses or lack of profitability, unless the airports are situated in peripheral or isolated regions.
Aid for airports. 1) Infrastructure aid does not need to be notified if the public investor acts like a private investor would in a market economy. State aid for investment in airport infrastructure is allowed if there is a genuine transport need and the public support is necessary to ensure the accessibility of a region. Aid must not be used to duplicate existing resources or excess (the Commission will take account of other forms of transport, like the train). The intensity of authorised aid must be inversely proportionate to the size of the airport (75% of ineligible investment costs for airports with fewer than a million passengers a year, 50% of airports with between 1 and 3 million passengers and 25% for airports with between 3 and 5 million passengers). Aid is not allowed for airports with more than 5 million passengers. 2) Operating aid for regional airports (with fewer than 3 million passengers a year) will be allowed for a transitional period of 10 years under certain conditions, in order to give airports time to adjust their business model. To receive operating aid, airports need to work out a business plan paving the way towards full coverage of operating costs at the end of the transitional period. As under the current market conditions, airports with an annual passenger traffic of below 700,000 may face increased difficulties in achieving full cost coverage during the transitional period, the guidelines include a special regime for those airports, with higher aid intensities and a reassessment of the situation after five years.
Aid for airlines. Start-up aid to airlines of up to half the cost of launching a new air route is permitted provided it remains limited in time and as long as the air route takes off from an airport with fewer than 3 million travellers a year or more travellers in exceptional circumstances (such as for remote regions), as long as the aid is unbiased.
In all cases, the Commission will examine aid on a case-by-case basis against criteria, such as whether the aid will contribute to a common interest, failure of the market, the existence of an incentive, proportionality and whether the aid is suitable for the pursued objective. (FG/transl.fl)