The Court of Justice of the European Union - Europe's highest court - has dismissed an appeal by Ryanair (FR, Dublin International) concerning EUR10 billion euros (USD10.7 billion) worth of COVID-19-era Spanish state aid approved by Brussels in 2020.

Ryanair challenged a decision by the General Court of the European Union on May 19, 2021, which rejected the airline's attempt to contest the European Commission's approval of the Spanish aid on July 31, 2020. The Spanish state had set up an aid scheme to establish a solvency support fund. The beneficiaries were strategic Spanish undertakings experiencing temporary difficulties due to the pandemic.

The Court of Justice upheld the General Court's ruling, confirming that the Spanish state aid scheme was proportionate and did not violate the principle of non-discrimination based on nationality. The EU permits different treatment of companies when the aid aims to address a significant economic disruption in a member state. The highest court found that Ryanair did not prove that the Spanish aid scheme's restrictive effects exceeded those typical of such aid or constituted an obstacle to the freedom to provide services and establish businesses.

The Court of Justice also agreed with the General Court that the European Commission was not required to balance the aid scheme's positive effects against its negative impact on trading conditions and competition within the EU. Given the aid scheme's exceptional nature and significant objectives, a fair balance was deemed to have been achieved between its benefits and adverse effects, making it in the common interest of the EU.

Ryanair acknowledged the ruling and criticised the EU competition authority for not yet having recovered pandemic-era state aid granted to its rivals, and which had been rejected by the General Court, Reuters reports. Ryanair pointed out that the General Court had ruled as unlawful aid received by airlines like Air France, KLM Royal Dutch Airlines, Lufthansa, SAS Scandinavian Airlines and certain Italian airlines. The Irish carrier also lambasted the Commission for not addressing the competitive damage caused by governments favouring their national airlines. Ryanair has had mixed success with its legal challenges around state aid granted by the EU, winning some and losing others.