Ryanair barred from Strasbourg subsidies

NANCY, France, Dec 18 (AFP) – A French appeals court here on Thursday barred subsidies received by Irish budget airline Ryanair from the Strasbourg chamber of commerce, a court official said.

The appeals court upheld a lower court decision that subsidies paid by the chamber of commerce to Ryanair represented an improper use of public funds to support the carrier’s Strasbourg-London service.

The appeals court “annulled … the agreements linking the company Ryanair and the Strasbourg chamber of commerce and industry (CCI),” the official told AFP.

In the Ryanair deal to offer service between the Strasbourg-Entzheim airport in eastern France and London’s Stansted airport, the CCI had agreed to pay EUR 560,000 (USD 694,000) a year for at least five years to purchase advertising space in the British press and promote Ryanair’s Web site.

The payments were to be made as part of an effort to bring more traffic to the Strasbourg area and to boost the regional economy.

But a Strasbourg court, ruling on a complaint by Air France subsidiary Brit Air, found on July 24 that the CCI payments amounted to a misuse of public money.

Ryanair subsequently closed the Strasbourg-London service, which it had opened on October 31, 2002, and switched traffic to Baden-Baden, 40 minutes from Strasbourg in Germany.

In France most regional airports are under the management of local chambers of commerce, themselves statutory bodies.

 © AFP

                                                                Subject: France news