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Small airplane high in the clouds. A large red suitcase is in the foreground
Budget airline Ryanair is fighting to retain its low-cost strategyImage: Fotolia/Olly

Ryanair legal blues

February 10, 2011

Germany’s highest court says low airport fees for Ryanair may breach EU competition rules. Lufthansa and Air Berlin want the budget airline to repay millions of euros in what they claim are illegal subsidies.


Lufthansa and Air Berlin claim that Irish budget airline Ryanair is using its dominant position at small, regional airports to force them to cut their fees. They argue that this gives Ryanair an unfair competitive advantage. The two airlines want the Dublin-based company to be forced to pay back millions of euros in what they claim are essentially illegal subsidies.

On Thursday, the Federal Court of Justice in Karlsruhe overturned judgements by the relevant regional and appeals courts, and ruled that the low fees may indeed amount to subsidies in breach of EU competition rules. This is being seen by observers as an indication that Lufthansa and Air Berlin now have a good chance of winning.

Ryanair argues that is has neither sought subsidies nor received any. It said that Lufthansa and Air Berlin should lower their ticket prices and not waste money on expensive lawsuits.

“If these expensive airlines don't want to pay exorbitant fees to expensive airports that are already taking on more traffic than they can handle, than they too are free to fly to Frankfurt-Hahn Airport or Hamburg-Lübeck Airport, like we do,” said Ryanair.

Creating a level, but more expensive, playing field

Lufthansa is optimistic it will win its claim. “We expect that it will become more difficult for Ryanair and smaller airports to profit from illegal subsidies and distort competition in the air travel industry,” a statement said.

“We consider the court's decision to be a success,” said a spokeswoman for Air Berlin.

German air travel continues to boom. Figures released by the Federal Statistics Office in Wiesbaden show that 166 million passengers transited through German airports in 2010. That's an increase of eight million passengers, or five percent, on 2009.

Author: Wilhelmina Lyffyt (Reuters, AP)

Editor: Susan Houlton

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