Ryanair Holdings Plc (RYA)’s deals with Nimes airport in France will be investigated by European Union regulators over whether the company benefited from French government subsidies.
The European Commission will probe rebates and marketing agreements between Ryanair and the airport that may have given the airline an “undue economic advantage,” as well as financial arrangements between French authorities and the Nimes facility, regulators said in an e-mailed statement today.
Nimes airport received state subsidies of more than 2 million euros ($2.6 million) and cash advances of more than 9 million euros from 2000 until 2006, the EU said. The investigation will also cover public subsidies to Veolia Transport, a private company which has operated the airport since 2007. The payments may violate EU state aid rules because they “may cover ordinary operating expenses,” regulators said.
EU regulators opened a similar probe into Ryanair’s agreements with France’s Carcassonne airport earlier this month, adding to several reviews of discounts and subsidies offered by small, regional airports across Europe to attract low-cost airlines. The Brussels-based commission must approve large state subsidies to airports and airlines and can order companies to pay back government funding if it can’t be justified as providing a public service.
“Ryanair’s arrangements with all EU airports comply with competition rules,” said Stephen McNamara, a Dublin-based spokesman for the airline, in an e-mail.
Nimes airport and Veolia Transport didn’t immediately respond to an e-mail seeking comment.
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