Ryanair furiousat Charleroi ruling

3 February 2004

BRUSSELS – Cut-price airline Ryanair has reacted furiously after being ordered to pay back millions of euros it received from Belgium’s Walloon government in exchange for developing its activities at Charleroi airport.

Ryanair chief Michael O’Leary said the ruling meant that air passengers in Europe would now have to face higher fares, and he slated what he saw as the Commission’s failure to promote competition.

The airline also hinted that it may cut routes to some other state-owned airports in Europe, a move that would hit destinations in France and Spain particularly hard.

Speaking to the UK’s BBC television network after the ruling, O’Reilly said the decision marked a “bad day for EU air travel”.

In a widely anticipated ruling, EU Transport Commissioner Ana De Palacio said Ryanair would have to pay back some, though not all, of a multi-million euro discount deal it struck with the Walloon government and Charleroi airport itself back in 2001.

The Commission put no precise figure on the amount the Irish airline will have to stump up but EU insiders have suggested a sum of around EUR 4 million.

De Palacio argued that the Commission had taken a “well balanced” decision and had only punished Ryanair when it had received funding or special discounts not available to other airlines.

The Commission was particularly critical of a 50 percent reduction in landing charges Charleroi offers to Ryanair but no other airlines as well as the fee of EUR 1 per passenger the airport charges the Irish airline for ground handling charges. The usual charge for such services is between EUR 8 and EUR 13.

Ryanair says it will challenge Tuesday’s ruling at the European Court of Justice in Luxembourg and has also threatened to bring lawsuits against any other European airlines that have struck preferential deals with state-owned airports like Charleroi. The Irish airline warns such legal action would hit nearly all air carriers in Europe.

Subject: Belgian news