EU ready to rule against Ryanair

THE EU Commission is expected to rule today that Ryanair’s deal with Charleroi airport is illegal.

Its decision could result in the low fares airline being forced to pay back between €4m and €10 million in aid from the Walloon state government.

The airline’s shares fell nearly 30% last week after it warned profits this year would be 10% less than the previous year’s outturn.

However, the shares have regained some of this lost ground and yesterday they closed down 21 cents at €4.66.

In today’s ruling the EU Commission is expected to brand the deal as a secret commercial one.

In particular, it is going to brand the 1 landing charge, half the rate charged to other airlines, as anti-competitive.

The Commission will also insist that the acceptable parts of the deal agreed for 15 years will have to be cut back to a maximum of three years.

And in future, grants to the airline will be permitted only if they can be linked to the cost of setting up new routes.

It is understood the amount to be repaid by Ryanair will not be decided immediately.

The amount due to be returned by the airline will not be arrived at until the Commission has fully examined the full extent of the deal conceded by the Walloon state to the airline.

EU president, Pat Cox, who represents Munster as an MEP, warned yesterday that the Brussels ruling could have an impact on the development of regional airports.

Mr Cox has written to the Commission seeking “reassurances” that their ruling will not conflict with regional development in the EU.

“It is important to ensure that the decision taken does not lead to unforeseen, unplanned and potentially unwelcome practical side effects in different regions across Europe,” said Mr Cox.

Reservations about the anticipated outcome of the ruling were aired also by Commissioner David Byrne and EU vice-president, Neil Kinnock.

Despite their concerns however it is expected the majority of the Commission will back the findings.

Ryanair has made it clear it will fight any decision made against it today.

The airline said last night that the off-the-record briefing by the EU Commission yesterday was unprecedented and would have a seriously prejudicial effect on the Commission’s vote today.