Judgments nº T-716/17 of Tribunal General de la Unión Europea, May 13, 2020

• Resolution Date: May 13, 2020
• Issuing Organization: Tribunal General de la Unión Europea
• Decision Number: T-716/17

(State aid - Aviation sector - Aid granted by Italy in favour of Sardinian airports - Decision declaring the aid partly compatible and partly incompatible with the internal market - Imputability to the State - Beneficiaries - Advantage for co-contracting airlines - Market economy operator principle - Effect on trade between Member States - Adverse effect on competition - Obligation to state reasons - Aid scheme - De minimis aid - Recovery)

In Case T-716/17,

Germanwings GmbH, established in Cologne (Germany), represented by A. Martin-Ehlers, lawyer,

applicant,

v

European Commission, represented by T. Maxian Rusche and S. Noë, acting as Agents,

defendant,

APPLICATION under Article 263 TFEU for the annulment of Commission Decision (EU) 2017/1861 of 29 July 2016 on State aid SA 33983 (2013/C) (ex 2012/NN) (ex 2011/N) - Italy - Compensation to Sardinian airports for public service obligations (SGEI) (OJ 2017 L 268, p. 1),

THE GENERAL COURT (First Chamber, Extended Composition),

composed of S. Papasavvas, President, J. Svenningsen (Rapporteur), V. Valančius, Z. Csehi and P. Nihoul, Judges,

Registrar: P. Cullen, Administrator,

having regard to the written part of the procedure and further to the hearing on 3 October 2019,

gives the following

Judgment

Background to the dispute

The measures at issue

1 The island of Sardinia (Italy) has five airports, including Alghero, Cagliari-Elmas and Olbia airports.

2 Alghero airport is operated by So.Ge.A.AL SpA (‘SOGEAAL’), whose capital was entirely subscribed by local public bodies and the majority of whose shares is held by the Regione autonoma della Sardegna (Autonomous Region of Sardinia, Italy; ‘the Autonomous Region’), including indirectly through Società Finanziaria Industriale Regione Sardegna (SFIRS). Cagliari-Elmas airport for its part is operated by So.G.Aer SpA (‘SOGAER’), a company the majority of whose shares is owned by the chamber of commerce of Cagliari (‘the CCIA of Cagliari’), while Olbia airport is operated by GEASAR SpA (‘GEASAR’), a company registered in Olbia, the majority of whose shares is owned by a private company, Meridiana SpA.

The provisions adopted by the Autonomous Region

- Article 3 of Law No 10/2010

3 On 13 April 2010, the Autonomous Region adopted legge regionale n. 10 - Misure per lo sviluppo del trasporto aereo (Regional Law No 10 - Measures for the development of air transport) (Bollettino ufficiale della Regione Autonoma della Sardegna No 12, of 16 April 2010) (‘Law No 10/2010’).

4 Article 3 of Law No 10/2010, entitled ‘Incentives to seasonal adjustments of the island’s air routes’ (Incentivi alla destagionalizzazione dei collegamenti aerei isolani), reads as follows:

‘1. Expenditure of [EUR] 19 700 000 for the year 2010 and of [EUR] 24 500 000 for each of the years 2011 to 2013 shall be authorised to finance the island’s airports with a view to strengthening and developing air transport as a service of general economic interest, including seasonal adjustments of air routes, in accordance with Communication from the Commission 2005/C 312/01 - Community guidelines on financing of airports and start-up aid to airlines departing from regional airports.

2. The criteria, nature and duration of the transport offer, together with the guidelines for the drafting of plans of activities by the airport management companies, which must take into account the measures relating to territorial continuity referred to in Article 2, shall be defined by decision of the Regional Executive to be adopted on the proposal of the Member of the Regional Executive responsible for transport, in agreement with the Members of the Regional Executive responsible for planning, the budget, credit and regional development, tourism, handicrafts and trade, agriculture and agricultural and livestock reform, cultural heritage, information, recreation and sport.

3. The decision referred to in paragraph 2 and the plans of activities, including those already defined by the airport management companies on the date of entry into force of the present Law, together with the corresponding measures and contracts, shall be financed if they are drawn up in accordance with the criteria, nature and duration of the transport offer and with the guidelines referred to in paragraph 2 and shall first be submitted for a binding opinion to the competent committee.’

   - The measures implementing Law No 10/2010

   5 In accordance with Article 3(2) of Law No 10/2010, the Executive of the Autonomous Region adopted several acts implementing the measures provided for in Article 3 of that law (‘the implementing measures’), in particular deliberazione della Giunta regionale n. 29/36 (Regional Council Decision No 29/36), of 29 July 2010 (‘Regional Decision No 29/36’), deliberazione della Giunta regionale n. 43/37 (Regional Council Decision No 43/37), of 6 December 2010 (‘Regional Decision No 43/37’), and deliberazione della Giunta regionale n. 52/117 (Regional Council Decision No 52/117), of 23 December 2011 (‘Regional Decision No 52/117’) (together with Article 3 of Law No 10/2010, ‘the measures at issue’).

   6 Those implementing measures define three clusters of ‘activities’ for which airport operators could receive compensation from the Autonomous Region for the years 2010 to 2013, namely:

   - increase in air traffic by airlines (‘activity 1’);

   - promotion of the island of Sardinia as a touristic destination by airlines (‘activity 2’);

   - further promotional activities entrusted by airport operators to third service providers other than airlines on behalf of the Autonomous Region (‘activity 3’).

   7 Regional Decision No 29/36, on the one hand, specified that, in the implementation of Article 3 of Law No 10/2010, the objective of reducing the seasonality of air routes involved increasing the frequency of flights during the mid-season and the winter season and opening up new air routes. On the other hand, that decision stated that the ultimate objective pursued by the measures provided for in Article 3 of Law No 10/2010 for the promotion of a regional air transport policy was the strengthening of economic, social and territorial cohesion, as well as the development of the local economies, tourism and culture of the island of Sardinia.

   8 In that regard, Regional Decision No 29/36 defined the criteria, nature and duration of the transport services for which compensation could be provided during the period 2010-2013 as well as guidelines for the development and evaluation of the ‘plans of activities’ drawn up by the airport operators.

   9 Specifically, in order to receive financing provided for by Law No 10/2010, an airport operator had to submit for approval to the Autonomous Region a detailed plan of activities. That plan had to identify which of the activities, of activities 1 to 3 mentioned in paragraph 6 above, the airport operator intended to implement in order to attain the objectives of Law No 10/2010. That plan was to be achieved through specific agreements between the airport operator and airlines.

   10 Where an airport operator wished to receive financing for activity 1, the plan of activities which it submitted to the Autonomous Region had to identify the ‘routes of strategic interest’ (domestic and international) and define the targets per year concerning flight frequency, new routes and number of passengers.

   11 According to the Italian authorities, the operation of those routes of strategic interest constituted the service of general economic interest which the airlines provided in exchange for compensation.

   12 A plan of activity implementing activity 2 had to define specific marketing and advertising activities aimed at increasing the number of passengers and at promoting the catchment area of the airport.

   13 Regional Decision No 29/36 provided that the plans of activities had to be backed up by forecasts of the prospects for the profitability of the activities they identified.

   14 According to Regional Decision No 29/36, the plans of activities had to respect certain principles:

   - the routes of strategic interest established by the plans could not overlap with routes already operated under a public service obligation;

   - the financing for each of the subsidised routes had to decrease over time;

   - the financial agreement concluded with the airlines was to include a plan for promotion of the territory.

   15 If the Autonomous Region noticed inconsistencies between, on the one hand, the plans of activities submitted by the airport operators and, on the other hand, the provisions of Law No 10/2010 and its implementing measures, it could require that changes be made to those plans of activities.

   16 After having approved the various plans of activities submitted to it by the airport operators, the Autonomous Region distributed among the airport operators the financial resources available for each of the years 2010 to 2013.

   17 Where the total of the contributions requested by the airport operators exceeded the amount provided for by Law No 10/2010, Regional Decision No 29/36 laid down preferential award criteria.

   18 The final amounts of the annual contributions were determined a posteriori, taking into account the amounts, possibly lower than those provided for in the plans of activities, actually paid by the airport operators in implementation of the said plans. For the purposes of confirming those amounts, those operators had to submit reports specifying, in particular, the costs actually incurred for the actions undertaken and accompanied by supporting documents.

   19 Moreover, the implementing measures provided that airport operators were to monitor the performance of airlines. In particular, they required that the specific agreements concluded between airport operators and airlines provide for the imposition of penalties on airlines for non-fulfilment of pre-defined targets, inter alia in terms of frequency of flights and number of passengers.

   20 Finally, the Autonomous Region’s contributions...