The European Commission has ordered France to recover EUR8.5 million euros (USD9.5 million) in illegal state aid from Ryanair (FR, Dublin International).
"Our investigation showed that certain payments by the French local authorities in favour of Ryanair to promote Montpellier airport gave Ryanair an unfair and selective advantage over its competitors and caused harm to other regions and other regional airports. This is illegal under EU State aid rules. France must now recover the illegal State aid," EU Commissioner responsible for competition policy Margrethe Vestager said in a press release.
The EU authority concluded that marketing agreements between the local Association for the Promotion of Touristic and Economic Flows (APFTE) and Ryanair concerning the carrier's presence at Montpellier airport "did not correspond to effective marketing needs of APFTE but only served as an incentive for Ryanair to maintain its operations at Montpellier airport." The Commission also established that the contracts were either signed directly with the Irish LCC and its subsidiary or awarded through biased tenders.
The agreements in question were concluded between 2010 and 2017. Ryanair ceased serving Montpellier in April 2019. The investigation itself was launched in July 2018 after a complaint lodged by a competing airline.
According to the ch-aviation schedules module, Montpellier is currently served by 17 airlines, of which the largest are Air France (AF, Paris CDG) (35.6% market share by weekly seat capacity), easyJet (London Luton) (19.5%), and Volotea (V7, Barcelona El Prat) (10.6%).
Meanwhile, the Italian newswire Ansa has reported that an Italian court has upheld an earlier EUR1.85 million euro (USD2.1 million) fine imposed on Ryanair by the Italian competition watchdog (Autorità Garante della Concorrenza e del Mercato - AGCM) for misinforming passengers about their rights during a wave of cancellations caused by a pilot shortage in September and October 2018.
The Irish Times added that Ryanair has vowed to appeal against both rulings.
