A top European Union court on Wednesday annulled the EU’s approval of €3.4-billion ($5-billion) in state aid for the Dutch carrier KLM Royal Dutch Airlines, but suspended its immediate application because of the impact of the pandemic on the industry.
In a similar ruling backing a challenge from Irish air carrier Ryanair DAC, the court also overturned the EU’s decision to back state aid to the TAP Portuguese carrier for a potential total of €1.2-billion, but also suspended its application pending a new EU decision.
In both cases, the Luxembourg-based General Court said that the European Commission had to come up with more complete reasoning why such aid could be granted.
The two rulings were a success for Ryanair, which had been stymied in its attempts to challenge before the court such state aid to other EU airlines.
The EU’s executive arm, the European Commission, which polices state aid and other competition issues, has approved several aid plans for struggling airline companies in the wake of the pandemic, especially after border closings and other restrictions halted most air travel.
Ryanair had argued that the aid constituted unfair state bailouts for national carriers.
The rulings of the General Court can be appealed on points of law only.
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