Ryanair challenges €650mn Polish state aid to LOT

Ryanair (FR, Dublin Int’l) has lodged another complaint at the Court of Justice of the European Union (CJEU) against airlines across the continent receiving state aid, this time targetting the EUR650 billion euros (USD772 million) in public funds that LOT Polish Airlines (LO, Warsaw Chopin) has received, Puls Biznesu and Gazeta Wyborcza reported.

The Irish carrier has so far challenged aid to 20 airlines, which it says have received a total of EUR30 billion (USD35.7 million). The European Commission approved the sum to LOT in December, to compensate it for losses suffered during the Covid-19 pandemic.

The aid will consist of a EUR400 million (USD475 million) subsidised loan granted by the state-owned Polish Development Fund (Polski Fundusz Rozwoju) and a capital injection of EUR250 million (USD297 million) through newly minted shares taken up by the Polish treasury.

“We appealed against the decision in the LOT case to the CJEU at the beginning of July. The case is pending. The next step is the response of the European Commission and probably the intervention of Poland that supports it. I suspect that the trial will not take place until 2022,” Juliusz Komorek, Ryanair’s chief legal and regulatory officer, told Puls Biznesu.

LOT spokesman Krzysztof Moczulski countered: “Ryanair accuses the European Commission of, among other things, the misapplication of state aid rules, including recapitalisation as a support measure, instead of other less market-distorting methods. It should be noted, however, that before issuing its decision, the commission analysed the LOT case in detail, the conditions of the assistance provided, its necessity, and how appropriate the forms of support accepted are.”

LOT Polish Airlines posted a net loss of over PLN1 billion zloty (USD260 million) for 2020 as passenger numbers plunged from almost 10.5 million in 2019 to three million in 2020, disrupting the plans it had to expand that year and beyond.

LOT and Ryanair did not immediately respond to ch-aviation’s request for comment.