Official Journal of the European Union
Appeal brought on 10 December 2021 by TUIfly GmbH against the judgment of the General Court (Fifth Chamber) delivered on 29 September 2021 in Case T-447/18, TUIfly GmbH v European Commission
(Case C-763/21 P)
Language of the case: German
Appellant: TUIfly GmbH (represented by: L. Giesberts and D.J. Westarp, Rechtsanwälte)
Other party to the proceedings: European Commission
Form of order sought
The appellant claims that the Court should:
set aside the judgment of the General Court of the European Union of 29 September 2021 in Case T-447/18 in its entirety and annul Articles 7 and 8 of Commission Decision (EU) 2018/628 of 11 November 2016 on State aid SA.24221(2011/C) (ex 2011/NN) implemented by Austria for the Klagenfurt airport, Ryanair and other airlines using the airport (OJ 2018 L 107, p. 1.), and Articles 9, 10 and 11 thereof, in so far as they refer to Articles 7 and 8;
order the European Commission to pay the costs of both sets of proceedings.
Grounds of appeal and main arguments
In support of its appeal, the appellant relies on two grounds of appeal.
First, in the judgment under appeal, the General Court misinterpreted Article 107(1) TFEU and thus infringed EU law. In the context of Article 107(1) TFEU, the General Court exceeded, in its application of the market economy investor principle, the limits of what is permissible in the interpretation of EU law.
On the one hand, the General Court, like the Commission, incorrectly considered that an advantage had been granted to the appellant. In that regard, in its application of the market economy investor principle, the General Court erred in law by setting out a series of impermissible considerations. First of all, it interpreted Article 107(1) TFEU not strictly objectively but subjectively. In doing so, the General Court (like the Commission) focused on the fact that the Member State had not prepared business plans before the conclusion of the agreements. However, that did not comply with the case-law and administrative practice at the time, with the result that the General Court infringed the requirement of protection of legitimate expectations and the principle of non-retroactivity.
Furthermore, the General Court based its profitability analysis only on short-term considerations of profitability, even though that is substantively incorrect pursuant to the case-law of the Courts of the European Union and did not comply with the administrative practice at the relevant time. In so doing, the General Court erred by retroactively applying to the marketing agreements the Commission’s Aviation Guidelines, issued only after the conclusion of those agreements. In addition, the application itself was incorrect. The General Court also provided as reasons for its findings alleged particularities of the low-cost carrier sector that did not exist at the relevant time.
The appellant submits that had due regard been had to long-term profitability considerations and had the abovementioned infringements not occurred, the existence of aid under Article 107(1) TFEU would have had to be rejected.
Second, the appellant complains that the General Court, as regards the potential justification of the aid, applied Article 107(3)(c) TFEU incorrectly and evidently contradicted itself.
First of all, the assessment criterion chosen by the General Court (solely focusing on the profitability of individual flight connections operated by the appellant) was substantively incorrect, as it failed to take account of the requisite differentiation, pursuant to the legal classification, between facts and justification. Moreover, the criterion (in particular concerning the 2003 marketing agreement) in no way complied with the administrative practice or case-law relevant at the time. In addition, unlike in the case of the aid granted to the airport, the General Court erred in law by failing to take any account, as regards the appellant, of the transport needs of the Carinthia region. That resulted in an irreconcilable contradiction in the assessment on account of the proximity and the identical nature of the interests as regards the aid granted to the airport and to the appellant. The General Court disregarded fundamental assessments of Article 107(3) TFEU and thereby infringed that provision.
The appellant submits that, had Article 107(3) TFEU been legitimately applied, justification of the aid would have had to be accepted.