EU draws up new air subsidy rules

A day after fining Ryanair for violating anti-competition rules, the European Union head office began drafting EU-wide rules on subsidies low-cost airlines can receive from small regional airports.

EU spokesman Gilles Gantelet said the European Commission was “working on a set of guidelines … taking stock of deregulation and the evolution of low-cost airlines”.

He said it would soon consult governments and airlines on the guidelines governing contracts between airlines and airports.

The Commission told Irish no-frills carrier Ryanair yesterday it received illegal subsidies from the publicly owned airport at Charleroi, just south of Brussels, gaining an unfair edge over other airlines.

Ryanair may have to pay back around €5.1m of the €17.6m it has received in subsidies from Belgian authorities to entice it to operate at the Charleroi airport.

The subsidies came in reduced landing and ground-handling fees and one-off injections of funds for hiring staff, marketing new routes, office space and hotel accommodation.

Gantelet said the Commission still had not decided how much exactly Ryanair had to repay.

He said that would be determined in talks with the Belgian government which has two months to “reply and give their first estimate about the possible amount that has to be repaid” by Ryanair.