State aid – Guidelines on aid to airports and airlines

SUMMARY OF:

Communication from the Commission – 2014 guidelines on State aid to airports and airlines

Communication from the Commission prolonging the specific regime for operating aid for airports with up to 700,000 passengers per annum provided for in the guidelines on State aid to airports and airlines (2018)

Communication from the Commission extending the transitional period provided in the guidelines on State aid to airports and airlines concerning regional airports (2023)

WHAT IS THE AIM OF THE COMMUNICATIONS?

The European Commission’s 2014 communication sets out general principles and compatibility conditions for State aid to airports and airlines in the European Union (EU). These guidelines aim at ensuring good connections between regions and the mobility of EU citizens, while minimising distortions of competition in the EU’s single market.
In 2018, the Commission decided to postpone its evaluation of the specific regime for airports with fewer than 700,000 passengers per year, and issued a communication aligning the duration of that specific regime with the transitional period for regional airports with more than 700,000 passengers per year.
Since the adoption of the guidelines and the 2018 communication, the aviation sector has faced a major crisis as a result of the COVID-19 pandemic and the aggression of Russia against Ukraine. The 2023 communication extends the transitional period in the 2014 guidelines on State aid to airports and airlines concerning regional airports. The specific regime applying to airports with fewer than 700,000 passengers is also prolonged accordingly.

KEY POINTS

2014 guidelines

The guidelines introduced a new regulatory framework under which operating aid to airports is compatible with the single market for a transitional period of 10 years.
They also set out the conditions under which investment aid to airports and to airlines is compatible with the single market.
They were drawn up as part of the State aid modernisation programme.

The main features of the guidelines include the following.

Setting clear rules for assessing airport–airline agreements, to ensure that they are aid-free and contribute to the profitability of the airports concerned.
Permitting State aid for investments in airport infrastructure if there is a genuine transport need. The maximum permissible aid amounts are defined based on the size of an airport, in order to ensure the right mix between public and private investment. The possibilities to grant aid are therefore higher for smaller airports than for larger ones.
Allowing operating aid to regional airports (with fewer than 3 million passengers a year) for a transitional period of 10 years under certain conditions, in order to give airports time to adjust their business model and to become profitable at the end of the transitional period in April 2024 (a date that was subsequently extended – see below).
Providing for a higher aid intensity for airports with annual passenger traffic of up to 700,000 that may face increased difficulties in achieving full cost coverage during the 10-year transitional period; the guidelines therefore provide for a specific regime for such airports for an initial period of 5 years until 3 April 2019 (a date that was subsequently extended – see below).
Permitting start-up aid to airlines for opening new routes from airports with up to 3 million passengers a year for a maximum of 3 years. The airlines need to either provide a business plan showing the viability of the route in the future or commit to continuing to operate the route after the period covered by the aid.

The guidelines stated that the Commission was to undertake a general evaluation of the guidelines by 4 April 2020, including the rules on operating aid for airports.

2018 communication

In 2018, the Commission decided to postpone the evaluation of the specific regime of granting operating aid to airports with up to 700,000 passengers per year. It issued a communication prolonging the existing rules to provide for continuity and legal certainty in the treatment of this type of aid until 3 April 2024, thus aligning the duration of that specific regime with the transitional period applicable to regional airports with more than 700,000 passengers per year.

2023 communication

In view of the crisis being experienced by the aviation industry as a result of the COVID-19 pandemic, and of the impact of Russia’s war of aggression against Ukraine, both of which have hurt the profitability of smaller and regional airports, the Commission adopted a further communication in 2023. To avoid the possible closure of regional airports and its negative impact on connectivity, it extends until 4 April 2027 the transitional period during which EU Member States can grant aid to cover the operating costs of these airports. It also prolongs until 4 April 2027 the regime permitting higher aid intensity for airports with up to 700,000 passengers a year.

FROM WHEN DO THE GUIDELINES APPLY?

The guidelines have applied since 4 April 2014.

BACKGROUND

For further information, see:

State aid: Commission adopts new guidelines for State aid to airports and airlines – press release (European Commission)
State aid: Commission to prolong EU State aid rules and launch evaluation – press release (European Commission)
State aid: Commission prolongs the possibility to grant operating aid to certain regional airports – press release (European Commission).

MAIN DOCUMENTS

Communication from the Commission – Guidelines on State aid to airports and airlines (OJ C 99, 4.4.2014, pp. 3–34).

Successive amendments to the communication have been incorporated into the original text. This consolidated version is of documentary value only.

Communication from the Commission concerning the prolongation of the specific regime for operating aid for airports with up to 700,000 passengers per annum provided for in the guidelines on State aid to airports and airlines (OJ C 456, 18.12.2018, pp. 27–28).

Communication from the Commission extending the transitional period provided for in the guidelines on State aid to airports and airlines concerning regional airports (OJ C 244, 11.7.2023, pp. 1–3).

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