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March 25, 2023

EU Commission opens in-depth investigations into State aid to Romanian air transport sector

The European Commission (EC) has opened two in-depth investigations under European Union (EU) State aid rules into a Romanian support scheme for investments in regional airports, a press release informs. EC wants also to ascertain whether certain rebates and discounts granted by the Timisoara airport to some airlines distort competition.

The Commission doubts whether the public financing meets a clearly defined objective of general interest, given the apparent oversupply of airport services in the country. In addition, the Commission needs to assess whether the upgraded infrastructure is necessary and proportional, in particular with a view to the limited activity of the airports. The initial investigation shows that Romania’s regional airports are generally loss-making and that their operating losses are covered by the State on a yearly basis. EU rules allow for aid to start up services at regional airports or to cover for services of general economic interest.They do not allow for covering operating losses on a continued basis.

As regards Timisoara airport, the Commission also needs to verify whether the annual subsidies granted to the airport only serve to reduce the airport operator’s current expenditures. In the absence of a general economic interest purpose, this would be incompatible with EU rules as it would provide an unfair advantage to the beneficiary with regard to its competitors, who have to operate without aid. The Commission will also further investigate the contractual relations between Timisoara airport and Wizz Air, namely a marketing agreement signed in 2008 and the non-payment of airport charges amounting to EUR 2.6 million as well as additional rebates of 72 to 85 per cent on all airport charges for large aircraft.

In reaction to the inquiry opened by the European Commission, Cornel Samartinean, Director, Timisoara International Airport, said that the prices practiced at the Timisoara airport are included in a public information system available to all the airlines operating at the airport, and no ‘special terms” apply for a company or another. He also said he had not yet received a formal note over the investigation launched by the European Commission.

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