EU objects to state aid for Brussels Airlines

The European Commission has raised strong objections to the €15 million subsidy approved by the outgoing Di Rupo government for Brussels Airlines. A thorough investigation has been ordered.

According to the government, the aid is for Brussels Airport, part of a €19.4 million package to be shared between three airlines – Brussels Airlines, Thomas Cook and Jetairfly. The two smaller airlines receive €1.2 million and €3.2 million respectively.

The Commission criticised the subsidy on the grounds that it had not been informed in advance. EU rules are on the whole against the granting of state aid to companies because it is seen as protectionist and a distortion of fair trade.

Exceptions are possible, and the investigation now under way will require an explanation from the government, which will argue the strategic and economic importance of the country’s main airport.

The government could, according to analysts, have trouble convincing the Commission that the best way to support the airport is to subsidise the security costs of only three airlines. Those three airlines were selected because they are the only ones carrying more than 400,000 passengers annually out of Brussels Airport.

The main recipient, Brussels Airlines, recorded an operational loss last year of €28 million, which would have been almost half as large again without the government subsidy. The three airlines received their aid payments for 2014 only two weeks ago, after the mobility ministry delayed the payment out for budget reasons.

Next to the EU investigation, the subsidy package is also the subject of legal action brought by Ryanair and the anti-noise nuisance group Pas Question.

photo courtesy Bergen Lehle/Wikimedia