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Ryanair to appeal EC decision to support Alitalia buy-out

14th November 2008 - 09:28 GMT | by The Shephard News Team


Ryanair, Europe's largest low fares airline, today (13th Nov) questioned the European Commission's objectivity when it comes to enforcing the state aid rules against failed national airlines after it rubber stamped yet another illegal multi-billion euro bailout of the terminally ill Italian national carrier, Alitalia, and also passed a rescue package for another bankrupt Italian airline, Alpi Eagles.

Ryanair said that the decision again to bail out Alitalia and Alpi Eagles made a further mockery of the Commission's enforcement of the state aid rules after the EU claimed that the decisions "will strengthen competition and sends a positive signal to the air transport sector".

To add insult to farce, the Commission found an earlier "loan" of €300m to Alitalia by the Italian government to have been illegal state aid. At the time of the loan Ryanair urged the Commission to suspend the loan before Alitalia could spend it given that it was clearly illegal state aid, a point which is not confirmed by the Commission. However, the Commission refused to do so and now Alitalia is incapable of paying it back.

Highlighting this latest corrupt application of the state aid rules by the Commission, Ryanair's Director of Legal and Regulatory Affairs, Jim Callaghan, said:

"It is now clear that the Italian Commissioner's assurance to the European Parliament that "the State aid rules will be rigorously enforced, irrespective of the country concerned" was false. Thus far the Commission has ignored several complaints by Ryanair regarding blatantly illegal state aid and other protectionist measures being pursued by the Italian Government to prop up their failed national carrier. In total, Ryanair has brought some 10 complaints against Alitalia, including:

· Alitalia's previous multi-billion bailout in 2004, whereby they shifted billions of debt into a separate subsidiary and received a multi-million "recapitalisation" by the Italian government.

· A previous illegal "restructuring loan" of €400m.

· Employing the same trick again in 2008 where over a billion euro in bad debts has been written off by the Italian government.

· A further "loan" of €300m - now found illegal but will never be paid back.

· Certain members of the consortium "purchasing" Alitalia are also involved in the bank that will value Alitalia's assets!

· Failure of the Italian Government to obtain the payment of debts owed by Alitalia to Italian airports.

· Illegal payment to Alitalia of €35 million in bogus "9/11 compensation" - 4 years after 9/11!

· Rebates on fuel costs for "Italian airlines".

· Reductions in airport charges at "Italian hubs".

· Passengers of other airlines flying to Italy, including Ryanair, being forced to pay for this mess through a €4.50 per passenger "redundancy tax".

"At the same time the Commission continues to pursue bogus complaints against small regional airports, in places like Pau in the South of France and Tampere in Finland. These airports are actually enhancing competition and putting pressure on monopoly main airports, and are therefore a threat to inefficient and uncompetitive national airlines like Alitalia.

"Ryanair will be appealing this latest blatantly corrupt decision by the Commission to the European Courts. Eventually, the Commission will be exposed for its corrupt and biased application of the state aid rules in favour of flag carrier airlines like Alitalia".

The Shephard News Team


The Shephard News Team

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