The Court of Justice of the European Union has set aside a 2024 judgment that annulled the European Commission’s approval of €3.4 billion in Dutch state aid for KLM. The 5 November ruling restores the approval for now, but does not end Ryanair’s challenge: the Court referred the airline’s remaining arguments back to the General Court for examination. The aid comprised a state-backed bank loan and a state loan to provide temporary liquidity during the Covid-19 pandemic.
The Commission’s decision of 16 July 2021 found the aid compatible with the EU internal market and identified KLM and its subsidiaries as the sole beneficiaries. Ryanair challenged that decision. In February 2024, the General Court annulled the approval, finding that the Commission had wrongly excluded Air France and the Air France-KLM holding company from its assessment of the beneficiaries.
The Court of Justice found that the General Court had substituted its own assessment for the Commission’s without demonstrating that the Commission’s conclusion was implausible. It therefore set aside the 2024 judgment and sent the unresolved grounds back to the lower court. Those include Ryanair’s arguments concerning non-discrimination, EU freedoms, the aid’s compatibility under Article 107(3)(b) of the Treaty on the Functioning of the European Union, procedural rights and the duty to give reasons.
Air France-KLM has said that the group’s Covid-era support was repaid with interest by 2023. The latest ruling does not conclusively establish the legality of the KLM aid; that question remains subject to the General Court’s further proceedings.