Opinion of Advocate General Pitruzzella delivered on 26 January 2023.

• Jurisdiction: European Union
• Celex Number: 62021CC0320
• ECLI: ECLI:EU:C:2023:54
• Date: 26 January 2023
• Court: Court of Justice (European Union)

OPINION OF ADVOCATE GENERAL

PITRUZZELLA

delivered on 26 January 2023 (1)

Case C‑320/21 P

Ryanair DAC

v

European Commission

(Appeal – State aid – Article 107(2)(b) TFEU – Sweden – COVID-19 – State guarantee on a revolving credit facility – Decision by the European Commission not to raise objections)

I. Introduction

1. On 13 March 2020, two days after the World Health Organization (WHO) classified the COVID-19 outbreak as a pandemic, the European Commission issued a press release (2) proposing an immediate reaction, in the form of ‘a European coordinated response’, to the major economic shock to the European Union caused by the public health emergency. In that press release, the Commission stated that it would use all the instruments at its disposal to mitigate the consequences of the pandemic, in particular, ‘to allow Member States to act decisively in a coordinated way, through using the full flexibility of [the State Aid Framework]’. It also emphasised that the main fiscal response to the coronavirus had to come from Member States’ national budgets and that the rules on State aid enabled the Member States to take swift and effective action to support companies. On 19 March 2020, the Commission adopted a communication setting out a ‘Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak’ (3) (‘the Temporary Framework’). The Temporary Framework recommended, inter alia, that, for critical situations, the Member States have recourse to specific derogations from the prohibition on State aid laid down in the Treaty, such as Article 107(2)(b) TFEU (4) and Article 107(3)(b) TFEU. (5) On the basis of the Temporary Framework, several Member States adopted measures, in the form of individual aid or aid schemes, to support airlines having an operating licence issued by Sweden. Those measures, based on Article 107(2)(b) TFEU or Article 107(3)(b) TFEU, depending on the case, were swiftly declared compatible with the internal market by the Commission, without the formal investigation procedure provided for in Article 108(2) TFEU being initiated. The Ryanair group contested the majority of those decisions before the General Court. The latter has, to date, dismissed all of those actions except for three, which it upheld, on the ground that the decisions contested in those cases were vitiated by an inadequate statement of reasons, while maintaining the effects of the annulled decisions. (6) Eight appeals brought by the Ryanair group are currently pending before the Court of Justice.

2. By the appeal which I address in this Opinion, Ryanair DAC (‘Ryanair’ or ‘the appellant’) asks the Court to set aside the judgment of 14 April 2021, Ryanair v Commission (SAS, Sweden; COVID-19) (7) (‘the judgment under appeal’), by which the General Court dismissed the application lodged by Ryanair pursuant to Article 263 TFEU and seeking the annulment of Commission Decision C(2020) 2784 final of 24 April 2020 (8) (‘the contested decision’) concerning the aid granted by the Kingdom of Sweden to the airline SAS AB (‘SAS’).

II. The facts, the procedure before the General Court, the judgment under appeal, the procedure before the Court of Justice and the forms of order sought

3. The facts on which the action before the General Court was based are described in paragraphs 1 to 3 of the judgment under appeal, as follows.

4. On 11 April 2020, the Commission authorised, under Article 107(3)(b) TFEU, an aid measure in the form of a scheme providing loan guarantees to certain airlines (‘the Swedish aid scheme’), notified by the Kingdom of Sweden on 3 April 2020. (9) On 21 April 2020, in accordance with Article 108(3) TFEU, the Kingdom of Sweden notified the Commission of an aid measure (‘the measure at issue’) in the form of a guarantee on a revolving credit facility of up to 1.5 billion kronor (SEK) (approximately EUR 137 million) for SAS, on the ground that SAS was having difficulties in securing loans from credit institutions in the framework of the Swedish aid scheme. That measure, intended to compensate SAS in part for the damage resulting from the cancellation or rescheduling of its flights following the imposition of travel restrictions amid the COVID-19 pandemic, was declared compatible with the internal market on the basis of Article 107(2)(b) TFEU.

5. By application lodged at the Registry of the General Court on 19 June 2020, Ryanair brought an action challenging the contested decision. The French Republic, the Kingdom of Sweden and SAS were granted leave to intervene in support of the form of order sought by the Commission. Ryanair put forward five pleas in law in support of its action, alleging, first, that the Commission had breached the requirement that aid granted under Article 107(2)(b) TFEU was not to make good the damage suffered by a single victim; secondly, that the measure at issue was not based on Article 107(2)(b) TFEU and that the Commission had erred in finding that the measure at issue was proportionate in relation to the damage caused to SAS by the COVID-19 pandemic; thirdly, that the Commission had infringed various provisions on the liberalisation of air transport in the European Union; fourthly, that the Commission had infringed Ryanair’s procedural rights by refusing to open the formal investigation procedure despite serious difficulties; and fifthly, that the Commission had infringed the second paragraph of Article 296 TFEU. By the judgment under appeal, the General Court rejected all of the pleas raised by Ryanair and dismissed the action in its entirety, ordered Ryanair to bear its own costs and to pay those of the Commission, and ordered the French Republic, the Kingdom of Sweden and SAS to bear their own costs.

6. By document lodged at the Registry of the Court of Justice on 21 May 2021, Ryanair brought the appeal which is the subject of this Opinion. On 14 September 2022, a joint hearing was held in respect of the present case and Case C‑321/21 P, Ryanair v Commission, (10) which concerns a measure similar to the measure at issue granted to SAS by Denmark. In the course of that hearing, Ryanair, the Commission, SAS, Sweden and France made oral submissions.

7. Ryanair asks the Court, principally, to set aside the judgment under appeal, annul the contested decision and order the Commission to pay the costs, and, in the alternative, to set aside the judgment under appeal, refer the case back to the General Court for reconsideration and reserve the costs of the proceedings at first instance and on appeal. The Commission asks the Court to dismiss the appeal and order the appellant to pay the costs. SAS asks the Court to dismiss the appeal and order Ryanair to pay the costs. Sweden and France ask the Court to dismiss the appeal.

III. The appeal

8. Ryanair raises six grounds in support of its appeal. The first alleges that the General Court erred in law in rejecting Ryanair’s claim that aid granted on the basis of Article 107(2)(b) TFEU is not to make good damage suffered by a single victim. The second alleges an error of law and manifest distortion of the facts in the application of Article 107(2)(b) TFEU and of the principle of proportionality in relation to the damage caused to SAS by the COVID-19 pandemic. The third alleges that the General Court erred in law in rejecting Ryanair’s claim regarding infringement of the principle of non-discrimination. The fourth alleges that the General Court erred in law and distorted the facts in rejecting Ryanair’s claim regarding infringement of the freedom of establishment and of the freedom to provide services. The fifth alleges an error of law and distortion of the facts in connection with the failure to initiate the formal investigation procedure. The sixth ground of appeal alleges an error of law and distortion of the facts in connection with a failure to state reasons.

A. The first ground of appeal

9. By its first ground of appeal, which is directed against paragraphs 22 to 27 of the judgment under appeal, the appellant argues that the General Court interpreted Article 107(2)(b) TFEU incorrectly in taking the view that that provision authorises the Member States to adopt individual aid measures.

10. In the judgment under appeal, the General Court rejected that same argument, raised by Ryanair at first instance, for two reasons. First, the General Court emphasised, in paragraphs 22 and 23 of the judgment under appeal, that there is no requirement for Member States to grant any aid to make good the damage caused by an exceptional occurrence within the meaning of Article 107(2)(b) TFEU. Secondly, it stated in paragraph 24 of the judgment under appeal that an aid measure may be directed at making good the damage caused by an exceptional occurrence, in accordance with Article 107(2)(b) TFEU, irrespective of the fact that it does not make good the entirety of that damage. It thus concluded, in paragraph 25 of that judgment, that, since the Member States are not obliged to make good the entirety of the damage caused by an exceptional occurrence, they are likewise not required to grant aid to all of the victims of that damage.

11. The appellant maintains that neither of the two reasons on which the judgment under appeal is based answers the allegation it made in its first plea in law. The issue underlying that allegation is not whether Sweden should have granted more aid or whether it was required to make good the entirety of the damage caused by the pandemic, but rather whether a Member State may adopt a measure, under Article 107(2)(b) TFEU, to support a single undertaking, arbitrarily chosen, to the exclusion of all other undertakings operating in the same market. Ryanair asserts that a reading of Article 107(2)(b) TFEU to the effect that it authorises only aid schemes, and not individual aid measures, can be arrived at from the wording and logic of that provision. Indeed, if the Member State concerned...