EU Commission Investigates Corsair’s Restructuring Plan for Compliance with State Aid Rules

The European Commission has initiated a detailed probe into the restructuring plan of Corsair International, a major move aimed at evaluating the plan’s alignment with EU state aid regulations. This investigation will scrutinize whether the adjustments proposed to Corsair’s strategy can ensure the airline’s sustainability without the need for further state support, all within a feasible timeframe.

In late 2023, Corsair announced it had obtained new funding to support its recapitalization efforts. Nonetheless, recent reports suggest that some aspects of this financial boost are now under scrutiny. The core of the Commission’s investigation, however, revolves around a EUR 136.9 million restructuring package approved in December 2020, designed to aid Corsair during the COVID-19 crisis. Two years subsequent to this approval, France requested modifications to the plan, which included amendments to existing financial instruments and the introduction of additional tax benefits.

The European Commission’s examination will determine the adequacy and authenticity of Corsair’s contributions and those from the market towards the restructuring expenses. It will also assess if the aid provided is proportional and ensures fair compensation for the state’s involvement.

The commencement of this investigation reflects the Commission’s obligation to perform a thorough analysis to confirm the restructuring plan’s compatibility with EU state aid laws. While opening an inquiry does not imply any assumption about the investigation’s conclusion, it does provide France and other interested parties an opportunity to submit their observations.

This move underscores the European Commission’s commitment to maintaining fair competition while ensuring that state aid interventions do not distort the market dynamics within the EU. Corsair’s case will be closely watched, as its outcome could have significant implications for the airline’s future and the broader aviation sector’s regulatory landscape.