Judgments nº T-259/20 of Tribunal General de la Unión Europea, February 17, 2021

• Resolution Date: February 17, 2021
• Issuing Organization: Tribunal General de la Unión Europea
• Decision Number: T-259/20

(State aid - French air transport market - Deferral of payment of civil aviation tax and solidarity tax on airline tickets due on a monthly basis during the period from March to December 2020 in the context of the Covid-19 pandemic - Decision not to raise any objections - Aid intended to make good the damage caused by an exceptional occurrence - Free provision of services - Equal treatment - Criterion of holding a licence issued by the French authorities - Proportionality - Article 107(2)(b) TFEU - Duty to state reasons)

In Case T-259/20,

Ryanair DAC, established in Swords (Ireland), represented by E. Vahida, F.-C. Laprévote, S. Rating and I.-G. Metaxas-Maranghidis, lawyers,

applicant,

v

European Commission, represented by L. Flynn, S. Noë and C. Georgieva-Kecsmar, acting as Agents,

defendant,

supported by

French Republic, represented by E. de Moustier, C. Mosser, A. Daniel and P. Dodeller, acting as Agents,

intervener,

APPLICATION under Article 263 TFEU for annulment of Commission Decision C(2020) 2097 final of 31 March 2020 on State Aid SA.56765 (2020/N) - France - Covid-19 - Deferral of the payment of airline taxes in favour of public air transport undertakings,

THE GENERAL COURT (Tenth Chamber, Extended Composition),

composed of M. van der Woude, President, A. Kornezov, E. Buttigieg (Rapporteur), K. Kowalik-Bańczyk and G. Hesse, Judges,

Registrar: S. Spyropoulos, Administrator,

having regard to the written part of the procedure and further to the hearing on 23 September 2020,

gives the following

Judgment

Background to the dispute

1 On 24 March 2020, the French Republic notified the European Commission, in accordance with Article 108(3) TFEU, of an aid measure in the form of a deferral of the payment of civil aviation tax and solidarity tax on airline tickets due on a monthly basis during the period from March to December 2020 (‘the aid scheme at issue’).

2 The aid scheme at issue, which is designed to ensure that airlines holding an operating licence issued in France pursuant to Article 3 of Regulation (EC) No 1008/2008 of the European Parliament and of the Council of 24 September 2008 on common rules for the operation of air services in the Community (OJ 2008 L 293, p. 3) (‘the French licence’) are able to maintain sufficient liquidity until the restrictions or prohibitions on movement are lifted and normal commercial activity resumed, thus defers payment of those taxes until 1 January 2021 and then spreads payments over a period of 24 months, until 31 December 2022. The precise amount of the taxes is determined by reference to the number of passengers carried and the number of flights operated from a French airport. In addition, the aid scheme at issue will benefit public air transport undertakings holding a French licence, which means that they have their ‘principal place of business’ in France (see paragraph 29 below).

3 On 31 March 2020, the Commission adopted Decision C(2020) 2097 final concerning State aid SA.56765 (2020/N) - France - Covid-19 - Deferral of the payment of airline taxes in favour of public air transport undertakings (‘the contested decision’), by which, after concluding that the aid scheme at issue constituted State aid within the meaning of Article 107(1) TFEU, it assessed the compatibility of the aid with the internal market and more particularly in the light of Article 107(2)(b) TFEU.

4 In that regard, in the first place, the Commission considered in particular that the Covid-19 epidemic constituted an exceptional occurrence within the meaning of Article 107(2)(b) TFEU and that there was a causal link between the damage caused by that occurrence and the harm compensated by the aid scheme at issue, since that aid scheme was aimed at reducing the liquidity crisis of airlines attributable to the Covid-19 pandemic, by providing a response to the cash-flow needs of public air transport undertakings holding a French licence.

5 In the second place, after observing that it followed from the case-law of the Court of Justice that only economic disadvantages caused directly by an exceptional occurrence might be compensated for and that the compensation could not exceed the amount of those disadvantages, the Commission considered, first, that the aid scheme at issue was proportionate in the light of the amount of the damage expected since the amount of the projected aid seemed to be lower than the commercial damage expected from the crisis resulting from the Covid-19 pandemic.

6 Secondly, the Commission considered that the aid scheme at issue was clearly established in a non-discriminatory fashion, since the beneficiaries of the scheme included all airlines holding French licences. In that regard, it emphasised that the fact that, in the case at hand, the aid was granted by a deferral of certain taxes also imposed on the budgets of airlines holding operating licences issued by other Member States did not affect its non-discriminatory nature, since the aid scheme at issue was clearly intended to compensate for the damage sustained by airlines holding French licences. The coverage of the aid scheme at issue therefore remains proportionate in the light of its objective of compensating for the damage caused by the Covid-19 pandemic. In particular, the aid scheme at issue contributes to preserving the structure of the aviation sector for airlines holding French licences. Consequently, the Commission considered that the French authorities had demonstrated at that stage that the aid scheme at issue does not exceed the damage caused directly by the crisis attributable to the Covid-19 pandemic.

7 The Commission therefore decided, having regard to the commitments given by the French Republic and, in particular, the undertaking to communicate to the Commission and to have validated by it a detailed methodology of the way in which that Member State intended to quantify, ex post facto and for each beneficiary, the amount of the damage associated with the crisis caused by the Covid-19 pandemic, not to raise objections to the aid scheme at issue.

Procedure and forms of order sought by the parties

8 By document lodged at the Court Registry on 8 May 2020, the applicant brought the present action.

9 By document lodged at the Court Registry on the same date, the applicant applied for the present action to be decided under an expedited procedure in accordance with Articles 151 and 152 of the Rules of Procedure of the General Court. By decision of 29 May 2020, the General Court (Tenth Chamber) granted the request for an expedited procedure.

10 The Commission lodged the defence at the Court Registry on 18 June 2020.

11 Pursuant to Article 106(2) of the Rules of Procedure, the applicant submitted a reasoned request for a hearing on 30 June 2020.

12 By document lodged at the Court Registry on 20 July 2020, the French Republic sought leave to intervene in the present proceedings in support of the form of order sought by the Commission. By document lodged at the Court Registry on 28 July 2020, the applicant requested, in accordance with Article 144(7) of the Rules of Procedure, that certain information concerning the number of bookings and the expected number of passengers contained in the application, in the abbreviated version of the application and in the annexes to those documents, should not be disclosed to the French Republic. Accordingly, it attached a non-confidential version of the application, the abbreviated version of the application and their annexes.

13 On a proposal from the Tenth Chamber, the Court decided, pursuant to Article 28 of the Rules of Procedure, to refer the case to a Chamber sitting in extended composition.

14 By order of 5 August 2020, the President of the Tenth Chamber (Extended Composition) of the Court granted the French Republic leave to intervene and provisionally limited disclosure of the application, the abbreviated version of the application and their annexes to the non-confidential versions produced by the applicant, pending the submission of any observations by the French Republic on the request for confidential treatment.

15 By a measure of organisation of procedure of 6 August 2020, the French Republic was permitted, pursuant to Article 154(3) of the Rules of Procedure, to lodge a statement in intervention.

16 On the 21 August, the French Republic submitted to the Court Registry its statement in intervention, without raising any objection in relation to the applicant’s request for confidential treatment.

17 The applicant claims that the Court should:

- annul the contested decision;

- order the Commission to pay the costs.

18 The Commission contends that the Court should:

- dismiss the action;

- order the applicant to pay the costs.

19 The French Republic submits that the action is inadmissible in so far as it seeks to challenge the overall merits of the assessment of the aid, and that it should be dismissed on substantive grounds as to the remainder. In the alternative, it submits that the entire action should be dismissed on its merits.

Law

20 It should be recalled that the Courts of the European Union are entitled to assess, according to the circumstances of each case, whether the proper administration of justice justifies the dismissal of the action on its merits, without first ruling on its admissibility (see, to that effect, judgments of 26 February 2002, Council v Boehringer, C-23/00 P, EU:C:2002:118, paragraphs 51 and 52, and of 14 September 2016, Trajektna luka Split v Commission, T-57/15, not published, EU:T:2016:470, paragraph 84). Therefore, having particular regard to the considerations which led to the present proceedings being expedited and the importance of a swift substantive response, both for the applicant and the Commission and the French Republic, it is appropriate to begin by examining the merits of the action without first ruling on its admissibility.

21 The applicant puts forward four pleas in law in support of its action. The...