European Commission forces Ryanair to return illegal state aid

Ryanair Boeing 737-800
Photo: © Alan Wilson

The European Commission has found that low-cost carrier Ryanair received illegal state aid as part of a marketing agreements with the local Association for the Promotion of Touristic and Economic Flows (APFTE) at the airport of Montpellier in France.

In July last year, the Commission launched an investigation into the marketing agreements following a complaint by a competing airline.

Ryanair and its subsidiary received payments worth around €8.5 million for promoting Montpellier as a touristic destination on its website. The European Commission came to the conclusion that the payments only served as an incentive for Ryanair to maintain its operations at Montpellier airport. Furthermore, the marketing agreements gave Ryanair an advantage over its competitors.

The Irish airline now has to return the €8.5 million of illegal state aid to France, in order to restore equal treatment with other companies. It does not have to pay additional fines under the European Union’s state aid rules.

The European Commission is currently investigating further agreements between public authorities and airlines at certain regional airports, for example concerning the German airport Frankfurt-Hahn, or the Spanish airports Reus and Girona. All three airports are primarily used by Ryanair.