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The European Commission will investigate whether financial arrangements between public authorities and the airports of Saarbrucken, Zweibrucken, Lubeck-Blankensee (Germany) and Klagenfurt (Austria), as well as rebates and marketing agreements concluded between these airports and some of the airlines using them, 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.
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 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.
On the basis of the information at its disposal the Commission cannot exclude that the measures in favour of the four airports and their customer airlines involve state aid which gives them an unfair advantage vis-a-vis their competitors and is thus incompatible with the internal market.
Saarbrucken airport
Saarbrucken airport is a regional airport in Saarland. It is financed by its mother company Verkehrsholding Saarland which itself receives regular capital injections from the State of Saarland. It additionally profited from guarantees and land transfers from Saarland. The Commission has doubts that the public authorities acted in accordance with the MEIP and that the airport could operate under market conditions. Moreover, the airport operates a discount scheme on airport charges open to all airlines using the airport and made additional payments to Cirrus Airlines and Air Berlin. The Commission has concerns that the discounts and payments granted to the airlines could provide them an undue economic advantage over their competitors.
Zweibrucken airport
Zweibrucken airport is a small regional airport in Rhineland-Palatinate, around 39 kilometres from Saarbrucken airport. It has allegedly received infrastructure and operating aid since 2006. Moreover, the Commission has concerns that arrangements on reductions of airport charges concluded between the airport and the airlines Germanwings, TUIfly and Ryanair could provide an undue economic advantage to these airlines compared with their competitors.
Lubeck-Blankensee airport
Lubeck airport is a small regional airport in Schleswig-Holstein around 70 kilometres from Hamburg. Until October 2009, Infratil Ltd., a New Zealand-based infrastructure investment company, owned 90% of stakes in Lubeck airport. After Infratil ended its engagement, the City of Lubeck purchased back its 90 % stakes. The Commission is concerned that the purchase price and agreements concluded in 2009 could provide an undue economic advantage to Infratil compared to its competitors.
The Commission also has doubts that financing measures provided by Lubeck to the airport are in line with the MEIP. The Commission is particularly concerned that given its financial situation that the airport would have ceased operations under normal market conditions. Moreover, the Commission has concerns that the 2006 schedule of airport charges and underlying discounts, prices for de-icing services, as well as individual agreements with Ryanair could provide an undue economic advantage to airlines using the airport compared with their competitors.
Klagenfurt airport
Klagenfurt airport is a small regional airport in Carinthia, Austria. The airport receives regular capital injections from the Federal State, the State of Carinthia and the City of Klagenfurt. The Commission has doubts that the public authorities acted in accordance with the MEIP and that the airport could operate under market conditions. Moreover, the airport operates a discount scheme open to all airlines using the airport and made additional marketing payments to Ryanair, TUIfly and Air Berlin. The Commission has concerns that the discounts and payments granted to the airlines could provide them an undue economic advantage over their competitors.
Theodore is the Co-Founder and Managing Editor of TravelDailyNews Media Network; his responsibilities include business development and planning for TravelDailyNews long-term opportunities.
