Ryanair to repay €4m subsidy

NO-FRILLS airline Ryanair has agreed to repay the €4 million subsidy relating to its operations at Charleroi in Belgium that fell foul of the European Commission earlier this year.

The company said yesterday that it would make the payment to take the pressure off the Walloon regional authority, which owns the airport at Charleroi and had provided Ryanair with discounted fees and marketing support to attract more business.

The commission declared some of these arrangements illegal in February, saying they constituted state aid that distorted competition, and told the authority to reclaim the money.

Ryanair said the payment would be made “under protest” and would not prejudice the outcome of the company’s appeal against the commission decision, which is still ongoing. The €4 million will be held on trust in a special bank account and repaid to Ryanair, with interest, if its appeal is upheld. The money will only be paid to the Walloon authorities if the European Court backs the commission. A final decision is not expected before September next year.

Ryanair head of communications Paul Fitzsimmons said the company did not want the payment issue to deflect attention away from the appeal process. Handing over the money meant a “sideshow” that had the potential to delay progress on the case was now out of the way, he said.

Mr Fitzsimmons rejected suggestions that the payment was a climbdown and said the company expected to get the money back when the appeal had run its course and the commission’s “unlawful decision” had been overturned.

The regional government wrote to Ryanair last month asking for repayment of the €4 million. The company sent a detailed reply yesterday, outlining its view that there was no legal requirement to repay the money and that no national court would stand over attempts to force payment until the appeal had been dealt with.

It said the Commission had ignored factual evidence that Charleroi was one of the more expensive airports used by Ryanair. Imposing full costs on the airline for using Charleroi hurt the competitiveness of regional and secondary airports and would force passengers to pay higher fares, it added.