Ryanair challenges Portugal’s TAP bailout

Low-cost pioneer Ryanair said on Thursday, August 27, it had taken its challenge over Portuguese aid for state-owned carrier TAP to the European courts.

The Irish-based carrier told Agence France-Presse it was appealing against a June decision by the European Commission to authorize a €1.2-billion ($1.5-billion) rescue loan for ailing TAP to keep it afloat as the coronavirus pandemic buffeted the aviation industry.

Lisbon then announced last month it was taking the carrier back into majority state ownership, boosting its stake to 72.5% from 50% with the 55-million-euro purchase of half of the Atlantic Gateway consortium’s stake controlled by United States businessman David Neeleman.

Portugal argues the move, which will see the fleet pared down and routes scrapped, will permit restructuring and TAP’s long-term viability.

Ryanair argues the cash injection amounts to illegal state support.

The commission said in June the aid did not violate competition rules and also last week green-lighted 290 million euros in aid for Brussels Airlines, part of the Lufthansa Group.

But Ryanair’s legal director Juliusz Komorek told Portuguese daily Publico that “a government cannot decide only to support national companies.”

The Irish carrier has also challenged aid packages for other rival carriers including SAS, Air France, and Lufthansa, insisting that it gets by without such help. – Rappler.com