The European Commission has launched on 27 August a public consultation on State aid in the aviation sector. The consultation will run until 8 October 2024.
The 2014 Guidelines on State aid to airports and airlines provide for:
- the interpretation on the notion of State aid in regard to public interventions for airports and airlines;
- the compatibility conditions for investment aid to airports with up to 5 million passengers per year;
- the compatibility conditions for operating aid to airports with up to 3 million passengers per year;
- the compatibility conditions for start-up aid to airlines for new routes at regional airports with up to 5 million passengers per year; and
- the compatibility conditions for aid of social character for certain categories of passenger.
All State aid provided for in the Guidelines, whether granted individually or as part of an aid scheme, must be notified in advance by Member States to the European Commission to be formally authorised before the aid can be granted.
The Guidelines on State aid to airports and airlines provide for a transitional period (originally up to April 2024 and extended to 2027) for operating aid to airports with between 700,000 and 3 million passengers per year.
Operating aid for airports with fewer than 700,000 passengers per year is subject to evaluation by the Commission, which has not yet been completed. It should be noted that a study commissioned by the Commission in this regard in 2019 confirmed the structural lack of profitability in this category of airport. The pandemic certainly did not help in the long-term development of those regional airports.
The other categories of aid covered by these Guidelines, namely investment aid for airports and start-up aid for new routes, are not subject to a transitional period.
The Guidelines' conditions for operating aid have never been fully realistic and adequate given the realities faced by the sector, as only part of the deficit may be covered by a subsidy. It should be remembered that the aid granted for a maximum of five years must not exceed 50% (for airports with between 700,000 and 3 million passengers per year) or 80% (for airports with fewer than 700,000 passengers per year) of the average deficit of the airport concerned over the period 2009–2013. The relevance of this reference period is debatable, as is the aid intensity for airports that may never achieve profitability but are nevertheless essential for economic development, tourism and connectivity of regions.
In this context, the Commission is now inviting the actors of
the aviation sector to submit their opinions on the current
Guidelines in order to assess whether they need to be
revised.
In particular, the call for evidence launched by the Commission
aims to:
- examine the evolution of the aviation sector and its needs since the adoption of the Guidelines in 2014 and evaluate the Commission's decision-making practice in relation to the Guidelines;
- verify whether the Guidelines should be updated and simplified in order to reduce the administrative burden and improve compliance by Member States; and
- assess how to better align the Guidelines with the priorities of the European Green Deal.
All interested parties, airports, airlines, industry
associations and ground handlers are invited to submit their
positions via the following link to the public consultation
documents:
State aid in the aviation sector - Commission
guidelines on airports and airlines (revision) (europa.eu).
The Commission will prepare a public consultation scheduled for the last quarter of 2024.
Finally, it is worth noting that the General Block Exemption Regulation, which allows Member States to grant aid without having to notify the European Commission in advance, includes investment aid for airports with a maximum of 3 million passengers per year and operating aid for airports with a maximum of 200,000 passengers per year under simplified and more appropriate conditions of compatibility. This Regulation is in force until the end of 2026.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.