World, As Seen from the most beautiful islands: Ireland and Cyprus

Court rules that state aid to KLM wasn’t well explained


A European Court called back the Dutch state on state aid to KLM, following objections from competitor Ryanair. This was demonstrated on Wednesday by a decision of the General Court of the European Union.

The Dutch government did not sufficiently explain why the billion-dollar aid was necessary, after the parent company Air France-KLM had already received aid from the French authorities, the court of first instance stated in its ruling.

The approval of the Dutch state aid of the European competition watchdog has therefore been annulled until the government has provided the necessary explanation. This has no direct impact on the aid KLM receives, due to its economic importance.

The court considers that the European authorities should examine ‘particularly carefully’ whether Air France-KLM and KLM do not form a single economic entity. Information on this is missing from the European Commission’s assessment. It should also be clear that the French aid to Air France-KLM was intended only for the French airline and could not have been used to support KLM. KLM announced that it would study the ruling.

Moreover, the Portuguese TAP also received no request from the European Court today. The state aid received by the Portuguese company was annulled because it was not sufficiently substantiated.

Written by: Liam O'Reilly

Liam O'Reilly is the founder of the publication, a former analyst at a major reputation agency in the UK, who chose Cyprus as his home.

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World, As Seen from the most beautiful islands: Ireland and Cyprus

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