Ryanair wins EU court appeal over KLM’s Covid-19 support

Ryanair Holdings Plc won a European Union court challenge against the EU’s approval of €3.4 billion ($3.7 billion) in state aid for rival Air France-KLM, in the latest round of the Irish carrier’s campaign against allegedly unfair subsidies doled out during the Covid-19 pandemic.

The EU’s General Court in Luxembourg on Wednesday annulled the European Commission’s decision, saying regulators “erred in defining the beneficiaries of the state aid granted.”

Ryanair — Europe’s biggest discount airline — has filed more than two dozen challenges to the vast amounts of state aid given by governments to local carriers, arguing the measures shouldn’t have been waved through by the EU’s executive because they distorted competition in the industry.

Ryanair said the EU’s approval of the aid “went against the fundamental principles of EU law, like the principle of non-discrimination on the basis of nationality.”

It’s the second time the commission has had its approval of the state aid overturned by EU judges. The same court in 2021 toppled its earlier approval of the support, giving the watchdog a chance to review its decision. The EU adopted a new decision in favor of the aid later that year. A spokesperson at the commission said it would “reflect on possible next steps.”

KLM said it had “repaid the loans granted under the temporary community framework for state aid in June 2022” and the “credit facility was terminated as of April 2023.”

The case is: T-146/22, Ryanair v. Commission (KLM II; COVID-19).