Ryanair Subsidies Ruled Illegal In France

by Ulrika Lomas, for LawAndTax-News.com, Brussels

22 December 2003

Low cost airline, Ryanair was angered on Thursday by a French appeals court's decision to uphold an earlier ruling against it, which stated that subsidies paid by the Strasbourg Chamber of Commerce to the airline represented unfair aid, and a misuse of public money.

The earlier decision followed a complaint by BritAir, a subsidiary of Air France, which objected to the fact that the Strasbourg Chamber was paying Ryanair in the region of 560,000 euros per year to promote its services and website. In return for this, Ryanair agreed to fly to Strasbourg, a move which substantially boosted the regional economy.

Speaking to the European media, Ryanair chief executive, Michael O'Leary pledged to appeal the case in the European courts, announcing that:

"Ryanair is committed to restoring its low-fares Strasbourg to London service and will be appealing this decision, if necessary all the way throught the French courts and to the European Court in Luxembourg itself."

"We are confident that the European courts will in time recognise the benefits for consumers and the regions of low-cost air travel between Strasbourg and London."

The airline is currently awaiting an European Commission judgement on whether aid granted to it by Belgium's Charleroi airport constituted illegal state aid. A decision is expected next month.

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