Despite counterclaim from Ryanair: Brussels approves state aid for Condor


Despite counterclaim from Ryanair
Brussels approves state aid for Condor

Last year, the German state supported the Condor holiday airline in the Corona crisis with around half a billion euros. After a lawsuit from Ryanair, a court intervenes. Now the EU Commission is improving the permit.

The European Commission has once again given the green light for German state aid to the Condor holiday airline with a total amount of around 525 million euros. Among other things, the aid is intended to cushion the consequences of the travel restrictions in the corona pandemic for the vacation airline and to initiate its restructuring, the EU Commission announced in Brussels.

A first positive decision was stopped by the EU court in Luxembourg. The commission has now made improvements. Airlines were hit particularly hard by the Corona requirements, said Competition Commissioner Margrethe Vestager. The restructuring plan also enables Condor to survive in the long term, she emphasized.

The aid for the vacation airline is controversial, the competitor Ryanair had complained against it. The EU court in Luxembourg had banned the aid on the grounds that the EU Commission had only insufficiently declared its release. The Commission has now taken the judges’ decision into account in its new decision, said the Brussels authority.

New owner jumped off

The state had backed Condor with around 550 million euros in loans in the Corona crisis last year because the entire passenger air traffic collapsed due to the travel restrictions. According to EU law, public aid is permitted in the event of extraordinary events with significant economic effects on companies, the EU Commission explained. The corona pandemic is such an event. Therefore, the EU countries are likely to help affected companies like Condor with aid. The German aid for the restructuring of the airline is also legal and does not distort competition.

At Condor, the situation was complicated by the bankruptcy of the parent company Thomas Cook in autumn 2019, which preceded the corona crisis. The airline was only able to continue working with rescue aid of 380 million euros. The insolvency proceedings initiated at that time had to be extended after the outbreak of the Corona crisis because the new owner, the Polish aviation company PGL, had jumped off.

The 550 million euro state aid also included costs that had arisen from the extension of the insolvency proceedings at Condor. Ryanair had filed a number of lawsuits against government aid to competitors in the Luxembourg court.

Condor is counting on the demand for travel to pick up again. “I’ve always been more optimistic than many that demand will come back faster than we think,” said Condor boss Ralf Teckentrup at the beginning of July.

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