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ECJ: AUA rescue during the Corona pandemic was lawful

by AI | 30.Jul 2024 | Europe in brief AI

The rescue of the airline Austrian Airlines by the Austrian state in the wake of the coronavirus pandemic was lawful, the European Court of Justice (ECJ) in Luxembourg ruled on Monday. The low-cost airlines Ryanair and Laudamotion believed that the EU Commission should not have approved the state aid.

Archive image - The AUA was rescued in June 2020 after the first pandemic wave with a total of 600 million euros. Photo: APA/Robert Jaeger

EU-wide/Brussels/Schwechat – The two low-cost airlines Ryanair and Laudamotion have ultimately failed with their lawsuit against the state rescue of Austrian Airlines (AUA) during the coronavirus pandemic. On Monday, the European Court of Justice (ECJ) in Luxembourg ruled that Austria’s 2020 aid of 150 million euros for AUA was lawful. The legal dispute formally concerned whether the EU Commission was allowed to approve the aid.

The low-cost airlines Ryanair and Laudamotion had filed a lawsuit against the EU Commission’s decision, but failed in the first instance EU General Court (EGC) about three years ago. The two airlines appealed to the ECJ. However, the Court of Justice today confirmed the EGC ruling.

AUA was rescued with a total of 600 million euros in June 2020 after the first pandemic wave. The 150 million euros concerned in today’s judgment flowed directly from the state treasury to the airline’s accounts and did not have to be repaid. A 300 million euro loan, for which the Republic assumed liability, has since been repaid by AUA. Another 150 million euros were contributed by German AUA-owner Lufthansa at that time.

In the past, the EGC has viewed state aid for airlines in Europe differently. For example, the EU Court has previously ruled that German aid for AUA’s parent company Lufthansa and state aid from the Netherlands and France for their interconnected airlines KLM and Air France were illegal. As a consequence, the EU Commission recently announced that it would re-examine the Lufthansa aid in Germany. (29.07.2024)