EU court rules against Lufthansa in $7B bailout case, saying approval breached state aid rules despite airline repaying funds
FRANKFURT: German airline giant Lufthansa Thursday lost a legal battle over a six-billion-euro ($7-billion) pandemic-era government bailout when the EU’s top court ruled Brussels mishandled its approval of the cash injection.
Europe’s biggest airline group by revenues received the bailout in 2020 to save it from collapse as government lockdowns to prevent the spread of Covid-19 brought air travel to a halt.
The European Commission approved the move, but Irish no-frills carrier Ryanair and German airline Condor brought legal action, claiming this broke state aid rules.
The European Court of Justice (ECJ) on Thursday dismissed a challenge from Lufthansa, and upheld an earlier ruling by a lower tribunal which had overturned the approval by the commission, the EU executive.
“The Court of Justice dismisses Lufthansa’s appeal and thus upholds the General Court’s ruling to annul the decision by which the Commission had approved the recapitalisation of Lufthansa,” it said in a statement.
The lower court had correctly concluded that the commission had “infringed” emergency rules brought in to allow governments to support the economy during times of crisis, it said.
The commission was examining the judgement, a spokesman said, adding it would press on with an investigation into the bailout, which was launched in 2024.
Lufthansa, which also operates Eurowings, Austrian, Swiss and Brussels Airlines and has acquired a stake in Italy’s ITA, has paid back the bailout cash, and it was not clear what impact the court defeat would have.
Lufthansa said in a statement that it took note of the judgement.
