In a judgment handed down on Wednesday 25 June (Case T-366/22), the General Court of the European Union dismissed the action brought by the low-cost airline Ryanair against State aid that Germany had granted in 2020 to the charter company Condor in order to deal with the Covid-19 pandemic.
The disputed measure consists of aid of €144.1 million and two loans from KfW backed by a public guarantee totalling €400 million. It was re-approved in July 2021 by the European Commission after a previous General Court judgment had declared it illegal, while maintaining its effects (case T-665/20 - see EUROPE 12737/25).
In the General Court’s view, the action is admissible because it upholds Ryanair’s procedural rights, in so far as the Irish company had not been able to submit observations during the procedure chosen by the Commission, namely a preliminary examination.
Nevertheless, in the European Court's view, Ryanair had not demonstrated that the EU institution should have had doubts as to the compatibility of the aid with the internal market. The fact that Condor was a firm in difficulty which had received rescue aid and restructuring aid (see EUROPE 13629/4) did not prevent it from also receiving aid in the context of the Covid-19 pandemic, provided that the conditions for obtaining such aid had been met.
In particular, the General Court held that, despite the difficulties encountered by Condor, the scenario adopted by the Commission, which was based on the plan for the German charter airline to be taken over by an investor, was plausible and the EU institution could rely on this scenario without any doubts. Condor was a healthy and viable company whose difficulties were linked to those of its parent company, Thomas Cook. The Commission could therefore expect investors to show an interest in its takeover.
In addition, the General Court rejects Ryanair’s arguments to the effect that the Commission failed to ensure that the aid in question compensated only for the costs arising from the lockdown caused by the Covid-19 pandemic and not for the costs associated with the restructuring of Condor. The arguments that no account was taken of the risk of double compensation with the rescue aid previously granted to Condor were also rejected.
See the General Court’s judgment: https://aeur.eu/f/hk0 (Original version in French by Mathieu Bion)