EC approves more aid to Alitalia, continues other probes

The European Commission has approved a further EUR73.02 million euros (USD90.5 million) in Italian state support for Alitalia (AZ, Rome Fiumicino), declaring it to be in line with EU state aid rules. The funding, which takes the form of a direct grant, is aimed at compensating the carrier for damages suffered “according to a route-by-route quantitative analysis of 19 eligible routes submitted by Italy” due to the coronavirus pandemic between June 16 and October 31, it said in a statement dated December 29. The restrictions in place in Italy and other countries to limit the spread of the virus have heavily affected Alitalia’s operations, especially regarding international and intercontinental flights, the EU watchdog said, and as a result the airline “incurred significant operating losses” at least until the end of October. The measure is proportionate, as the analysis “appropriately identifies the damage attributable to the containment measures, and therefore the compensation does not exceed what is necessary to make good the damage” on the 19 routes. As with other state aid provided to airlines by various European countries, the commission said it considered that the outbreak qualified as an exceptional occurrence, as it is an unforeseeable event having a significant economic impact. However, the commission’s investigations into past support measures to Alitalia are still ongoing, it warned. When the European Commission last approved Italian state aid to the troubled flag carrier, clearing EUR199.45 million (USD245 million) on September 4 for damages suffered from March 1 to June 15, it said that two earlier investigations were continuing. These two probes were opened on April 23, 2018, “on the basis of complaints received”, into a EUR900 million (USD1.1 billion) loan provided in 2017; and on February 28, 2020, to look into a EUR400 million (USD490 million) loan granted in October 2019. Separately, Alitalia’s state-appointed administrator, Giuseppe Leogrande, has urged the government to push through between EUR77 million and EUR77.5 million (USD94.5-95 million) in further funds to cover the last two months of 2020, the Corriere della Sera newspaper reported. Because of the collapse in passenger demand at the start of the winter season, the airline is again running out of cash, he warned. As expected, the business plan for Alitalia newco ITA – Italia Trasporto Aereo was sent from the board of directors to Italy’s parliament just before Christmas. It will be assigned to the relevant committees this week who will then have 30 days to examine it. The same document has also been sent to the European Commission for assessment. Meanwhile, sources told Corriere della Sera that the European Commission also green-lit, on December 23, EUR130 million (USD160 million) that Rome earmarked for Italian carriers Air Dolomiti, Blue Panorama Airlines, and Neos for damages suffered between March 1 and June 15. However, the European Commission has so far not publicly confirmed this. ch-aviation has contacted the three carriers for comment.