EU takes France to court over Ryanair state aid

The European Commission has referred France to the European Court of Justice for failing to recover incompatible aid received by Ryanair and its subsidiary Airport Marketing Services (AMS) for using Pau, Nîmes and Angoulême airports, as well as Transavia for using Pau airport.

The Commission decisions of 23 July 2014 required France to recover close to €10 million in total of incompatible state aid from the airlines. This is because through various contractual and marketing arrangements with the airports, the airlines paid less than the additional costs linked to their presence in the airport.

The airlines had therefore benefitted from an undue economic advantage, which has to be recovered to remedy the resulting distortion of competition, the European Commission said.

On the basis of the information currently at available to the Commission, France has failed to fully recover the incompatible aid within the required period of 4 months. The French authorities have sent out the recovery orders but have not been able to execute them under national law because they are under appeal by the beneficiaries.

Under a provision of French law recovery orders are automatically suspended in case of appeal. However, this goes against established European case law on the implementation of recovery decisions by Member States, which prevents national courts from applying such provisions when deciding on appeals against recovery orders.

In order to ensure its state aid decisions are fully implemented the Commission has therefore decided to refer France to the European Court of Justice.