The EU General Court has overturned another approval of state aid to an airline, ruling that the €321m ($344m) granted by Germany to charter airline Condor in 2021 should not have been approved by the European Commission (EC) without a formal investigation.
The ruling continues budget airline Ryanair’s ongoing success overturning EU approval for state aid handed out during and after the Covid-19 pandemic, following similar lawsuits against aid given to Air France-KLM, SAS, and Lufthansa.
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Condor received grants from the German Government after the collapse of its parent company Thomas Cook in 2019 to support the restructuring of the company as it sought to stay afloat and seek new ownership, eventually selling a majority stake to Attestor Capital.
While the General Court declared that Ryanair had not proven that aid given to Condor would have substantially affected its competitive position, it found that the EC had not taken steps to ensure the grant complied with adequate burden-sharing requirements.
A statement explaining the ruling said: “Any restructuring aid that enhances the beneficiary’s equity position should be granted on terms that afford the State a reasonable share of future gains in value of the beneficiary.”
The restructuring aid was granted to Condor in 2021 as part of a wider package that also included €204m in Covid-19 related compensation to support the company, similar to the aid that was granted to Air France-KLM and Lufthansa.
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By GlobalDataRyanair described it as a “triumph for fair competition”, a spokesperson said: “The European Commission’s approval of the German aid to Condor went against the fundamental principles of EU law.
“Today’s judgment confirms once again that the Commission must act as a guardian of the level playing field in air transport and cannot sign off discriminatory State aid promoted by national governments.”
In response to the General Court’s decision, a spokesperson from Condor told the press that the judgement would have “no impact” on the airline’s business situation and flight operations, saying that the repayment of state aid was going ahead according to plan.
