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UPDATE 1-EU says probing Bratislava aid for Ryanair

Tue Mar 11, 2008 11:23pm IST
 
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(adds Ryanair reaction, background)

BRUSSELS, March 11 (Reuters) - The European Commission said on Tuesday it was investigating an agreement on Irish low-cost carrier Ryanair's (RYA.I: Quote, Profile, Research) use of Slovakia's Bratislava airport on suspicion it may contain illegal state aid.

The European Union executive opened a formal probe after an unnamed complainant alleged Ryanair was getting preferential, cheaper airport charges for existing and new scheduled flights.

The EU's competition watchdog has previously ordered Belgium's Wallonia region to recover illegal state aid granted to Ryanair's operations at Charleroi airport, south of Brussels.

The no-frills airline reacted with indignation at what it called "further evidence of the European Commission's bias in applying one set of rules for high fare flag carriers and another set of discriminatory rules for Ryanair".

The Commission said it had ordered Bratislava airport to hand over a copy of the agreement after it had not complied with previous requests.

"Without access to this document, and on the basis of the information provided by the complainant, the Commission has doubts about its compatibility with EU rules on state aid," a Commission statement said.

The complainant said that under the deal concluded in December 2005 and running until 2016, the airport offered Ryanair a discount of up to 31 percent for existing destinations and 48 percent for new scheduled destinations.

Ryanair was one of the main beneficiaries of the European Commission's action in the 1990s to force open air travel in Europe to more competition, delivering lower fares and hugely increasing the number of air travellers.  Continued...

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