On Wednesday 13 May, the General Court of the European Union dismissed the appeals against the European Commission’s decision which, in July 2016, had declared Sardinia’s aid to the airlines easyJet, Volotea and Germanwings serving the island to be illegal (Cases T-8/18, T-607/17 and T-716/17).
In 2010, the Autonomous Region of Sardinia had authorised the financing of the island’s airports for the development of air transport, in particular through the seasonal adjustment of air links with Sardinia. The contested measures provided for the conclusion of commercial agreements between the operators of Sardinia’s main airports (Alghero, Cagliari-Elmas and Olbia) and airlines with a view to improving air services to the island and promoting tourism.
The three companies brought an action for annulment of the Commission’s decision that the Sardinian aid scheme was partly incompatible with the internal market.
By its judgment, the General Court dismisses the airlines’ appeal. It considers that the Commission was right to conclude that the airlines were beneficiaries of the aid scheme at issue. The payments made by the airport operators to the airlines under the agreements concluded represented a mobilisation of State resources, since the funds paid by Sardinia to the airport operators were used to make the payments in question. In addition, the Sardinian Region exercised effective control (prior approval of airport operators’ business plans, conditions required for the reimbursement of sums paid to airlines) over the allocated funds.
Secondly, the General Court rejects the airlines’ complaints concerning the absence of distortion of competition and effects on trade between Member States. In Case T-716/17, it rules out that Germanwings could usefully rely on the limited amount of the payment it received from the operator of Cagliari-Elmas airport. In Case T-607/17, it endorses the Commission’s choice not to apply Regulation (360/2012), as Volotea had not established the existence of clearly defined public service obligations in respect of each of the air routes for which it had received aid.
Finally, in Cases T-8/18 and T-607/17, the General Court held that the airlines could not have had any legitimate expectation in the legality of the aid or in the commercial nature of their contractual relations with the airport operators.
See judgment T-8/18: https://bit.ly/3dEK7Jy
See judgment T-607/17: https://bit.ly/3dKXVT1
See judgment T-716/17: https://bit.ly/3dKDRQK (Original version in French by Mathieu Bion)