State aid: Commission opens in-depth investigation procedure into measures in favour of Béziers airport in France and Ryanair

The European Commission has opened an in-depth investigation to assess whether operating aid granted to Béziers airport and marketing and airport services agreements concluded between Ryanair and the Béziers airport operators are in line with EU State aid rules.

Béziers airport is a regional airport located in the French region of Occitanie. The airport served more than 250,000 passengers in 2019. It was owned and managed from 2007 to 2011 by the Chamber of Commerce and Industry of Béziers St Pons, and since 2011 until today by the Syndicat mixte ”Pôle aéroportuaire Béziers Cap d’Agde Hérault – Occitanie”. The latter is exclusively composed of local and regional public authorities.

The Commission received a complaint concerning operating aid granted to the successive operators of Béziers airport from 2007 to today. The complaint also concerned marketing and airport services agreements concluded between Ryanair and the Béziers airport operators under the same period. The complainant alleged that the operating aid and the agreements amounted to illegal State aid in favour of Ryanair and the Béziers airport.

With respect to the Béziers airport operators, following a preliminary assessment, the Commission has decided to open an in-depth investigation as it has concerns that the operating aid is incompatible with the single market. In particular, the operating aid was granted by several local and public authorities to the operators, it was imputable to the State, involved public resources and granted an undue and selective advantage to the airport operators that potentially affected competition and trade between Member States.

With respect to Ryanair, following a preliminary assessment, the Commission has decided to open an in-depth investigation in relation to:

• Certain marketing agreements concluded since 2009 between the Syndicat mixte and Ryanair;
• Airport services agreements concluded since 2007 between the Béziers airport operators and Ryanair.

At this stage, the Commission has concerns that the agreements in question may give Ryanair an undue economic advantage vis-à-vis its competitors that might amount to incompatible aid in favour of Ryanair.

The Commission will now investigate further to find out whether its initial concerns are confirmed.

The opening of an investigation gives interested third parties the opportunity to submit comments. It does not prejudge the outcome of the investigation.

Background

In the aviation sector, the Commission’s guidelines on state aid to airports and airlines (see also MEMO) reflect the fact that, subject to certain conditions, public subsidies can be used by regional airports or regional authorities to attract price-sensitive airlines. Such subsidies can typically take the form of low airport charges, discounts to airport charges, success fees or marketing payments.

Publicly-owned regional airports may offer attractive conditions to airlines in order to boost their traffic. However, such conditions must in principle not go beyond what a profit-driven airport operator would be prepared to offer under the same circumstances (the market economy operator principle – MEOP). If this principle is respected, the conditions do not involve State aid to the airlines and are not subject to the Commission’s review. Conversely, if this principle is not respected, the conditions involve state aid and the Commission must then examine whether this can be found compatible with EU state aid rules.

In recent years, the Commission has concluded a number of cases regarding aid to airlines aimed at attracting or maintaining airlines’ aircraft capacity at certain airports, finding that they were not in line with State aid rules, for example regarding the airports of Montpellier, Nîmes, Pau, and Angoulême in France, Altenburg-Nobitz in Germany, Klagenfurt in Austria, and the Sardinian airports of Cagliari, Olbia and Alghero in Italy.

Also, the Commission is currently investigating further agreements between public authorities and airlines in certain regional airports, for example concerning the German airport of Frankfurt-Hahn or the Spanish airports of Reus and Girona.

The Commission considers that such measures can be very distortive on the highly-competitive, pan-European air transport market on intra-Union routes. Moreover, such measures can disadvantage regions and airports, which do not use unlawful State aid to attract airlines.

The non-confidential version of the decision will be made available under the case number SA.47970 in the State Aid Register on the Commission’s competition website once any confidentiality issues have been resolved. More information on the Commission’s state aid policy in the air transport sector is available in this policy brief.