The EU General Court (the “Court”) annuls, through its ruling dated 8 February 2023, the decision of the EU Commission approving Romanian aid to Timișoara International Airport in favour of Wizz Air.
Timișoara International Airport is operated by Societatea Națională ‘Aeroportul Internaţional Timişoara – Traian Vuia’ SA (“AITTV”), a joint stock company in which the Romanian State holds 80% of the shares.
AITTV received financing from the Romanian State for the construction of a terminal for non-Schengen flights and for security equipment within the context of Romania’s accession to the European Union in 2007. More particularly, AITTV signed in 2008 agreements with Wizz Air, a Hungarian low-cost airline, for the use of the airport infrastructure and services by the latter (the “2008 Agreements”). Two of those agreements were amended in 2010 by way of a new discount scheme agreed between Wizz Air and AITTV (the “2010 Amendment Agreements”). Under the Aeronautical Information Publications (“AIPs”) of 2007, 2008 and 2010, Wizz Air also received discounts and rebates on airport charges.
In 2010, the Romanian regional airline Carpatair SA submitted a complaint to the EU Commission challenging the aid granted by the Romanian authorities to Timișoara International Airport in favour of Wizz Air.
The EU Commission’s Decision
Following the complaint, the EU Commission issued its decision of 24 February 2020 (the “Contested Decision”), whereby it has been considered the following:
- the public financing provided in the period between 2007 and 2009 to AITTV for the non-Schengen terminal development constitutes State aid which is compatible with the internal market within the meaning of Article 107(3)(c) of the Treaty on the Functioning of the European Union (the “TFEU”); and
- the EU Commission found that the public financing of the access road and the development of the parking area in 2007 and for the security equipment in 2008, the airport charges in the 2007 AIP, 2008 AIP and 2010 AIP, and the 2008 Agreements with Wizz Air, including the 2010 Amendment Agreements, do not constitute State aid within the meaning of Article 107(1) TFEU.
Carpatair SA brought an action for the annulment of the Contested Decision in so far as the EU Commission found that neither the discounts and rebates on the airport charges in the 2010 AIP nor the 2008 Agreements, as amended in 2010, constitute State aid.
Findings of the Court
The Court finds, as regards the substance, that the Contested Decision is vitiated by several errors of law which affect the conclusion that neither the discounts and rebates on the airport charges in the 2010 AIP nor the agreements concluded with Wizz Air in 2008, as amended in 2010, constitute State aid within the meaning of Article 107(1) TFEU, since, according to the EU Commission, the former are not selective in nature and the latter do not confer an economic advantage to Wizz Air.
As regards, in the first place, the selective nature of the discounts and rebates on the airport charges in the 2010 AIP, the Court recalls that, although only measures which confer a selective advantage fall within the concept of ‘State aid’, it is apparent from the case-law that interventions which, prima facie, apply to undertakings in general may, in relation to their effects, be to a certain extent selective and, accordingly, be regarded as measures designed to favour certain undertakings or the production of certain goods. Such de facto selectivity can be established in cases where the structure of the measure is such that its effects significantly favour a particular group of undertakings.
In that context, the EU Commission also did not take a position on the question whether airlines other than Wizz Air had in their fleet aircrafts of the relevant sizes and sufficient frequencies which actually enabled them to benefit from certain rebates. In the light of those observations, the Court concludes that, by failing to examine whether all types of reduction, taken in isolation, favoured Wizz Air owing to the conditions governing its application, as Carpatair SA maintains, the EU Commission erred in law.
As regards, in the second place, the question whether an economic advantage was conferred to Wizz Air by the 2010 Amendment Agreements, the Court points out that the assessment is made in principle by applying the “private operator in a market economy” test. In order to examine whether or not the Member State or the public body concerned has adopted the conduct of a prudent private operator in a market economy, the only relevant evidence is the information which was available, and the developments which were foreseeable, at the time when the decision to conduct the operation in question was taken. However, the conclusion reached by the EU Commission in the Contested Decision, was based entirely on evidence established ex post and, in particular, on a report drawn up in 2015.
In that regard, the Court states that the view cannot be taken as the 2015 report relates to an ex ante analysis capable of demonstrating compliance with the private operator in a market economy test. Accordingly, the Court finds that the EU Commission failed to state grounds in law for its conclusion that the 2008 Agreements and the 2010 Amendment Agreements had not conferred an economic advantage on Wizz Air.
In light of those considerations, the Court upholds the action and annuls the Contested Decision in so far as it concludes that the airport charges in the 2010 AIP and the 2008 Agreements, including the 2010 Amendment Agreements, do not constitute State aid.