Ryanair strike new deal with airport

NO-FRILLS airline Ryanair has shrugged off the recent European Commission decision that threatened its routes to and from Charleroi airport near Brussels, by striking a new deal with the regional authority that owns the airport.

The agreement will leave the existing airport and handling charges, which help keep Ryanair's costs at a minimum, in place. But the charging structure will be reviewed when annual passenger numbers at Charleroi exceed 2 million, just 200,000 more than current levels.

The Walloon regional government will also bring in new legislation to make the discounts on offer to Ryanair available to other airlines, to counter the European Commission ruling in February that the subsidies were an illegal state aid to Ryanair that distorted competition.

Ryanair chief executive Michael O'Leary said the agreement meant that Ryanair would not close its base at Charleroi, from where it flies 11 routes across the continent, including services to Dublin and Shannon. Mr O'Leary said the European Commission's decision was flawed and that privately-owned airports offered Ryanair even lower cost arrangements than those available at Charleroi. Ryanair will appeal the decision next month.

"The Brussels Charleroi cost base passes the private investor principle, and when Ryanair appeals the decision to the European Court of First Instance in early May, this principle will form the core of our appeal," said Mr O'Leary.

Ryanair has also agreed to consider opening more routes from Charleroi as part of the deal. But this would be subject to the airport authorities building a second terminal and providing a competitive cost base for any new routes, the airline said.

The agreement between Ryanair and the airport authorities came as little surprise to analysts, given that the airline accounts for over 90% of Charleroi's business. The airline was ordered to repay over €4m in marketing subsidies after the European Commission decision, which cast doubt on the validity of Ryanair's commercial arrangements at all publicly-owned airports in Europe.

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