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The European Court of Justice (ECJ) has upheld a complaint by Ryanair over the German government’s financial rescue for the charter airline Condor.
In July 2021, the European Commission had approved a €321m state support package for the airline, after it ran into difficulties due to the insolvency of Thomas Cook, its former parent company.
Ryanair took a case against the European Commission to the ECJ on the basis that it had not carried out a formal investigation into the restructuring aid and Condor’s financial position.
Today the ECJ ruled that the Commission should have launched such an investigation due to doubts that the state aid was compatible with EU law, in particular the question of “adequate burden sharing”.
The court found that Ryanair had “demonstrated to a sufficient degree” that the Commission should have had doubts about the state aid.
It concluded that any restructuring aid for Condor which enhanced its equity position should have been granted in such a way as to ensure that the German state would have had a reasonable share of any future gains in the company’s value.
However, the court found that the Commission had not “ascertained whether the aid at issue had been granted on terms that would afford Germany a reasonable share of future gains in the value of Condor.”
The court ruled that while it had accepted Ryanair’s argument that the Commission’s decision to grant the restructuring aid should be annulled, it could not challenge the contents of the decision on its merits.
The court said that Ryanair had “not demonstrated that the aid at issue was liable to have a substantial adverse effect on its competitive position.”
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