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The European Commission has opened an in-depth investigation to assess whether financial arrangements between public authorities and the airport of Nimes (France), as well as rebates and marketing agreements concluded between this airport and Ryanair, are in line with EU state aid rules. The opening of proceedings gives interested third parties an opportunity to submit comments on the measures under assessment; it does not prejudge the outcome of the investigation.
Nimesis a regional airport in Gard (Languedoc-Roussillon region), with a total traffic of 176 521 passengers in 2010. It is located within 80 km of Marseille airport. The civil part of the airport is owned by the French state, and was operated by the local Chamber of Commerce until December 2006. Afterwards, the operation of the airport was awarded to Veolia Transport.
From 2000 to 2006, the Chamber of Commerce benefited from a range of public support measures for its activity as operator of Nimes airport, including subsidies of over €2 million and cash advances totalling over €9 million. Veolia Transport has also been granted public subsidies as the airport operator since 2007. At this stage, the Commission considers that these measures, granted by several public entities (including the region, Conseil General du Gard and local municipalities), may cover ordinary operating expenses of the airport operators and may therefore give them an undue economic advantage which their competitors do not have.
Finally, the Commission will examine whether agreements between the airport operators and Ryanair, such as marketing support contracts and discounts on airport charges, would have been contracted by a market economy investor. The Commission has concerns that such arrangements could give the airline an undue economic advantage that its competitors do not enjoy. In addition, the Commission will assess whether part of the aid to the airport operators has been passed on to the airline.
The Commission is currently conducting several investigations in the air transport sector.
Investments by public authorities into companies carrying out economic activities are in line with EU state aid rules when they are made on terms that a private player operating under market conditions would accept (the market economy investor principle, MEIP). In the aviation sector, infrastructure investment subsidies can, in principle, be found compatible with the 2005 guidelines on state aid in the aviation sector when they are necessary, proportionate, pursue an objective of general interest, ensure non-discriminatory access for all users and do not unduly affect trade in the internal market. Operating support is far more likely to distort competition between airports and is therefore, in principle, incompatible with the internal market.
In 2012 the Commission plans to revise its guidelines on aviation – covering both airlines and the financing of airport infrastructure – following a public consultation.
The non-confidential version of the decision will be made available under the case number SA.33961 in the State Aid Register on the DG Competition website once any confidentiality issues have been resolved. New publications of state aid decisions on the internet and in the Official Journal are listed in the State Aid Weekly e-News.
Theodore is the Co-Founder and Managing Editor of TravelDailyNews Media Network; his responsibilities include business development and planning for TravelDailyNews long-term opportunities.
