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Document 62020TJ0737

    Judgment of the General Court (Tenth Chamber) of 18 October 2023.
    Ryanair DAC v European Commission.
    State aid – Latvian air transport market – Aid granted by Latvia to airBaltic in the context of the COVID-19 pandemic – Recapitalisation – Decision not to raise any objections – Action for annulment – Locus standi – Admissibility – Temporary Framework for State aid measures – Measure intended to remedy a serious disturbance in the economy of a Member State – Failure to weigh the beneficial effects of the aid against its adverse effects on trading conditions and the maintenance of undistorted competition – Identification of the relevant market – Significant market power – Equal treatment – Freedom of establishment – Freedom to provide services – Obligation to state reasons.
    Case T-737/20.

    ECLI identifier: ECLI:EU:T:2023:641

     Judgment of the General Court (Tenth Chamber) of 18 October 2023 –
    Ryanair v Commission (airBaltic; COVID-19)

    (Case T‑737/20) ( 1 )

    (State aid – Latvian air transport market – Aid granted by Latvia to airBaltic in the context of the COVID-19 pandemic – Recapitalisation – Decision not to raise any objections – Action for annulment – Locus standi – Admissibility – Temporary Framework for State aid measures – Measure intended to remedy a serious disturbance in the economy of a Member State – Failure to weigh the beneficial effects of the aid against its adverse effects on trading conditions and the maintenance of undistorted competition – Identification of the relevant market – Significant market power – Equal treatment – Freedom of establishment – Freedom to provide services – Obligation to state reasons)

    1. 

    Action for annulment – Natural or legal persons – Measures of direct and individual concern to them – Commission decision finding State aid compatible with the internal market without opening the formal investigation procedure – Action by parties concerned within the meaning of Article 108(2) TFEU – Action designed to safeguard the procedural rights of the parties concerned – Admissibility

    (Arts 108(2) and 263, fourth para., TFEU; Council Regulation No 2015/1589, Art. 1(h))

    (see paragraph 15)

    2. 

    Action for annulment – Natural or legal persons – Measures of direct and individual concern to them – Individual concern – Criteria – Commission decision finding aid compatible with the internal market – Action of a competing undertaking claiming that its market position is significantly affected – Admissibility – Obligation for the competing undertaking to provide a precise definition of the market at issue and to compare the situation of all the competitors present on that market in order to differentiate itself in relation to them – None – Proof that the competing undertaking’s position on the market in question is significantly affected

    (Arts 108(2) and (3) and 263, fourth para., TFEU)

    (see paragraphs 16-37)

    3. 

    Action for annulment – Natural or legal persons – Measures of direct and individual concern to them – Direct concern – Criteria – Commission decision finding aid compatible with the internal market – Action brought by an undertaking which is a competitor of the undertaking in receipt of aid – Competing undertaking proving direct concern

    (Art. 263, fourth para., TFEU)

    (see paragraph 38)

    4. 

    Aid granted by a Member State – Prohibition – Derogations – Aid capable of being regarded as compatible with the internal market – Aid intended to remedy a serious disturbance in the economy of a Member State – Assessment – Aid measure in favour of an airline important for the national economy in the context of the COVID-19 pandemic – Assessment in the light of the Commission Communication on the Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak – Aid measure consisting in a recapitalisation of the airline – Measure necessary to remedy a serious disturbance in the national economy

    (Art. 107(3)(b) TFEU)

    (see paragraphs 49-53, 56-58)

    5. 

    Aid granted by a Member State – Prohibition – Derogations – Aid capable of being regarded as compatible with the internal market – Assessment in the light of Article 107(3)(b) TFEU – Taking into account previous practice – Precluded

    (Art. 107(3)(b) TFEU)

    (see paragraphs 54, 55)

    6. 

    Aid granted by a Member State – Prohibition – Derogations – Aid capable of being regarded as compatible with the internal market – Aid intended to remedy a serious disturbance in the economy of a Member State – Assessment – Aid measure in favour of an airline important for the national economy in the context of the COVID-19 pandemic – Assessment in the light of the Commission Communication on the Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak – Aid measure consisting in a recapitalisation of the airline – Risk of insolvency of the airline without the recapitalisation measure – No error of assessment

    (Art. 107(3)(b) TFEU; Commission Communication 2020/C 91/01 I/01, point (49)(a))

    (see paragraphs 71-73)

    7. 

    Aid granted by a Member State – Prohibition – Derogations – Aid capable of being regarded as compatible with the internal market – Aid intended to remedy a serious disturbance in the economy of a Member State – Assessment – Aid measure in favour of an airline important for the national economy in the context of the COVID-19 pandemic – Assessment in the light of the Commission Communication on the Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak – Aid measure consisting in a recapitalisation of the airline – Systemic importance of the recipient company for the economy of the country concerned – No error of assessment

    (Art. 107(3)(b) TFEU; Commission Communication 2020/C 91 I/01, point (49))

    (see paragraphs 74-92)

    8. 

    Aid granted by a Member State – Prohibition – Derogations – Aid capable of being regarded as compatible with the internal market – Aid intended to remedy a serious disturbance in the economy of a Member State – Assessment – Aid measure in favour of an airline important for the national economy in the context of the COVID-19 pandemic – Assessment in the light of the Commission Communication on the Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak – Aid measure consisting in a recapitalisation of the airline – Inability of the airline to obtain financing on the market for all of its needs on affordable terms – No error of assessment

    (Art. 107(3)(b) TFEU; Commission Communication 2020/C 91 I/01, point (49)(c))

    (see paragraphs 93-111)

    9. 

    Aid granted by a Member State – Prohibition – Derogations – Aid capable of being regarded as compatible with the internal market – Aid intended to remedy a serious disturbance in the economy of a Member State – Assessment – Aid measure in favour of an airline important for the national economy in the context of the COVID-19 pandemic – Assessment in the light of the Commission Communication on the Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak – Aid measure consisting in a recapitalisation of the airline – Measure including a mechanism aimed at incentivising gradual redemption of the capital received – No error of assessment

    (Art. 107(3)(b) TFEU; Commission Communication 2020/C 91 I/01, points (56), (61), (79) and (80))

    (see paragraphs 123-143)

    10. 

    Aid granted by a Member State – Prohibition – Derogations – Aid capable of being regarded as compatible with the internal market – Aid intended to remedy a serious disturbance in the economy of a Member State – Assessment – Aid measure in favour of an airline important for the national economy in the context of the COVID-19 pandemic – Assessment in the light of the Commission Communication on the Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak – Aid measure consisting in a recapitalisation of the airline – Conditions for presenting a restructuring plan – Breach of principle of proportionality – None

    (Art. 107(3)(b) TFEU; Commission Communication 2020/C 91 I/01, point (85))

    (see paragraphs 149-154, 156)

    11. 

    Aid granted by a Member State – Prohibition – Derogations – Aid capable of being regarded as compatible with the internal market – Assessment in the light of Article 107(3)(b) TFEU – Criteria – Weighing the beneficial effects of the aid against its adverse effects on trading conditions and the maintenance of undistorted competition – Not a necessary criterion

    (Art. 107(3) TFEU)

    (see paragraphs 162-167)

    12. 

    Aid granted by a Member State – Prohibition – Derogations – Aid capable of being regarded as compatible with the internal market – Aid intended to remedy a serious disturbance in the economy of a Member State – Assessment – Aid measure in favour of an airline important for the national economy in the context of the COVID-19 pandemic – Assessment in the light of the Commission Communication on the Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak – Aid measure consisting in a recapitalisation of the airline – Assessment of whether the airline has significant market power on the market in question – Definition of those markets using the airport-by-airport approach – Whether permissible

    (Art. 107(3)(b) TFEU; Commission Communication 2020/C 91 I/01, point (72))

    (see paragraphs 191-203)

    13. 

    Aid granted by a Member State – Prohibition – Derogations – Aid capable of being regarded as compatible with the internal market – Aid intended to remedy a serious disturbance in the economy of a Member State – Assessment – Aid measure in favour of an airline important for the national economy in the context of the COVID-19 pandemic – Assessment in the light of the Commission Communication on the Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak – Aid measure consisting in a recapitalisation of the airline – Assessment of whether the airline has significant market power on the market in question – No error of assessment

    (Art. 107(3)(b) TFEU; Commission Communication 2020/C 91 I/01, point (72))

    (see paragraphs 212-237)

    14. 

    Aid granted by a Member State – Prohibition – Derogations – Aid capable of being regarded as compatible with the internal market – Aid intended to remedy a serious disturbance in the economy of a Member State – Recapitalisation of an airline in order to compensate it in the context of the COVID-19 pandemic – Aid compatible with the internal market under Article 107(3)(b) TFEU – Assessment of compatibility with the principle of non-discrimination – Criteria – Objective of the aid – Need for the aid – Proportionality of the aid

    (Art. 107(3)(b) TFEU)

    (see paragraphs 244-262)

    15. 

    Aid granted by a Member State – Prohibition – Derogations – Aid capable of being regarded as compatible with the internal market – Aid intended to remedy a serious disturbance in the economy of a Member State – Assessment – Aid measure in favour of an airline important for the national economy in the context of the COVID-19 pandemic – Aid compatible with the internal market under Article 107(3)(b) TFEU – Infringement of the freedom to provide services and the freedom of establishment – None

    (Arts 49, 58(1), 100(2) and 107(3)(b) TFEU)

    (see paragraphs 267-272)

    16. 

    Aid granted by a Member State – Planned aid – Examination by the Commission – Preliminary review and main review – Compatibility of aid with the internal market – Difficulties of assessment – Commission’s duty to initiate the main review procedure – Serious difficulties – Concept – Objective nature – Circumstances enabling the existence of such difficulties to be established – Judicial review – Scope

    (Arts 107 and 108(2) and (3) TFEU; Council Regulation No 2015/1589, Art. 4(3) and (4))

    (see paragraphs 276-280)

    17. 

    Aid granted by a Member State – Commission decision not to raise objections to an aid scheme – Obligation to state reasons – Scope – Account taken of the context and all the legal rules governing the matter

    (Arts 107(3)(b) and 296 TFEU)

    (see paragraphs 284-292)

    Operative part

    The Court:

    1. 

    Dismisses the action.

    2. 

    Orders Ryanair DAC to bear its own costs and to pay those incurred by the European Commission and Air Baltic Corporation AS.

    3. 

    Orders the Republic of Latvia to bear its own costs.


    ( 1 ) OJ C 53, 15.2.2021.

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