Aviation
Commercial /
Europe
State support
TAP may lose its aid of 1.2 billion Euros after Ryanair's challenge
Airbus A321neo da TAP Air Portugal
Por Pedro Aragão, CC BY-SA 3.0, via wikimedia comons
Rafael Ramos
5/21/2021
TAP Air Portugal recorded a large net loss in 2019 and, supposedly, was having trouble maintaining itself. With the arrival of the pandemic, things got even more difficult, so that the European Commission authorized, on June 10, 2020, an emergency aid of 1.2 billion Euros for the company, as long as the company presented a restructuring plan by the end of the year.
The low-cost airline Ryanair protested the aid, claiming that the aid to TAP is not sufficiently substantiated and that it could generate an undue advantage for the company. Ryanair was heard and, a decision published today, May 19, by the European Commission, temporarily suspends aid from the Portuguese government for TAP. The company may, depending on the Commission's final decision, have to return the amount that has already been received. See the decision on the sternum link below.
Airbus A330-900neo
TAP
Nicky Boogaard, CC BY 2.0, via Wikimedia Commons
According to the Portuguese government, legal disputes over the aid are part of the market and believe that national aid will be maintained. TAP has 60 days to appeal, since the decision is still at first instance.
Ryanair also contested the Dutch government's € 3.4 billion aid to the KLM and the French government's € 7 billion aid to Air France. Ryanair's question was whether the money offered to KLM would be compatible with the company and why Air France had received it before KLM, since the two are from the same group. Thus, the General Court of the European Union suspended the financial aid until a further decision by the Commission, which had already been approved.
The Air France-KLM group will also have 60 days to respond to questions. In this period, no further aid can be received. See the decision on the external link below.
Ryanair, for its part, celebrated and said that state aid to Air France-KLM and TAP were against fundamental principles of European Union legislation and that they encourage unfair competition.
Hyperlinks:
https://curia.europa.eu/jcms/u...
https://curia.europa.eu/jcms/u...
Rafael Ramos
Aviation enthusiast from an early age, he had his first contacts with the area developing that good old habit of spending dozens of hours in front of the screens of Micrsoft Flight Simulator and other simulators. With a solid background in various technological areas, including engineering and chemistry, Rafael has rejoined aviation as editor and author of articles and materials on our portal, providing invaluable help to the dynamics and expansion of the website and the aeronautical community, bringing us the news and updates so indispensable for us to remain current in our area of operation.
   
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