On Tuesday 4 July, the European Commission announced that it had opened an in-depth investigation to examine the compliance of a Danish and Swedish recapitalisation measure worth around €1 billion (SEK 11 billion) in favour of SAS AB, an airline operating in Denmark, Sweden and Norway. SAS was threatened with failure and insolvency due to restrictions linked to the Covid-19 pandemic in 2020 (see EUROPE 13179/18).
Notified on 11 August 2020, the aid measure was initially approved by the Commission on 17 August 2020 under the temporary ‘Covid’ framework on state aid.
However, in its judgment of 10 May 2023, following an action for annulment brought by Ryanair (case T-238/21), the General Court of the EU annulled the European Commission’s decision (see EUROPE 13179/18).
The General Court found that the recapitalisation measure granted to SAS did not meet one of the conditions set out in the temporary ‘Covid’ framework.
The General Court found that the Commission had not required the inclusion of a step-up mechanism for increasing remuneration or any other mechanism with the same effect, designed to ensure that Denmark and Sweden would receive sufficient remuneration for their investment. The mechanism should also have encouraged SAS to buy back, in the shorter term, the shares acquired by Denmark and Sweden, thereby guaranteeing the temporary nature of the aid.
Following the General Court’s judgment, the Commission announced that it was opening a more detailed investigation into the recapitalisation measure.
The Commission’s preliminary view is that the recapitalisation measure complies with Article 107(3)(b) of the Treaty on the Functioning of the EU and with the conditions of the temporary ‘Covid’ framework, with the exception of the absence of a mechanism for increasing remuneration.
The final decision is expected in the coming months.
Links to the files in the Commission’s register: https://aeur.eu/f/7w3 ; https://aeur.eu/f/7w4 (Original version in French by Émilie Vanderhulst)