Ryanair loses challenge to German Condor bailout

low cost airline Ryanair Wednesday lost a legal challenge against Germany’s bailout of charter airline Condor.

The EU General Court ruled that the Dublin-based carrier had shown no reason to doubt the way the European Commission handled the aid request.

“The claimant has failed to refute the Commission’s findings that Condor’s difficulties resulted primarily from the liquidation of the Thomas Cook group and not from an arbitrary allocation of costs within the group,” said the court, adding that it had dismissed the action “in its entirety”.

Condor operated a fleet of over 50 aircraft before the Covid-19 pandemic. Germany announced the aid package to Condor after it filed for bankruptcy in September 2019 due to the liquidation of its parent company, Thomas Cook.

The German government then notified the commission that it would provide rescue measures for a period of six months by allowing the airline to reach an agreement with its creditors and a decision on its potential sale. The EU executive authorized in 2020 a German state-guaranteed loan of 550 million euros to Condor, but then decided in July 2021 that it would authorize the granting of 321.2 million euros to the company airline in the form of loans and cancellations.

However, the charter and holiday airline collapsed after a potential buyer pulled out in April 2020 when flights across Europe were grounded during the pandemic.

In its ruling, the court rejected Ryanair’s claim that the commission erred in law by approving the German bailout without conducting a formal inquiry procedure. Ryanair won a first challenge against the rescue in June 2021.

He also said the commission had correctly concluded that there was a risk of disruption to a significant service which was difficult to replicate as Condor’s insolvency had led to the immediate repatriation of up to 300,000 airline customers. .

James R. Rhodes