EU court withdraws easyJet, Volotea order to repay assistance; Dentons represented Volotea in achieving the landmark victory

EU court withdraws easyJet, Volotea order to repay assistance; Dentons represented Volotea in achieving the landmark victory

The Court of Justice of the European Union (CJEU) has cancelled earlier decisions ordering easyJet (London Luton) and Volotea (V7, Asturias) to reimburse Italian government aid. They received this for launching new routes out of Olbia and Cagliari airports in between 2010 and 2014.

The CJEU found that both the 2016 decision by the European Commission ordering the two airlines and the 2020 ruling by the lower-instance General Court upholding this decision were erroneous. It's being assessed based on the ruling on an appeal brought by the two airlines to return the funds.

Earlier, in particular, the CJEU resolved that the rulings incorrectly supposed that the aid bestowed was not in compliance with state aid rules.

According to the ruling, "The Court of Justice finds that the General Court, in the judgments under appeal, did not ascertain whether the Commission had fulfilled its obligation, in the decision at issue, to determine whether the contracts for the provision of services concluded between the airport operators and the airlines constituted normal market transactions."

The ruling resets a long-running case to the law adopted in 2010 by the Italian government to allocate EUR68.7 million euros (USD70.9 million) in public funds. It is to distribute to the operators of airports in Sardinia for route support systems. easyJet and Volotea subsequently nailed contracts with Olbia airport (at that time majority-owned by Meridiana fly (Olbia)) and Cagliari airport (operated by privately-owned Sogaer) for subsidies covering 2010-2014.

In 2016, the Commission ruled that these funds were bestowed to a private investor without the necessary test by the regional authority and ordered both carriers to return all funds.

The CJEU ruling does not openly say that the scheme was compliant with strict EU state aid rules. But it only upturns the Commission's and the General Court's decisions to that effect.

The team from Dentons comprised of Partners Michele Carpagnano (Rome) and Matthias Nordmann (Munich) led the Dentons legal team, with support from associates Giulia Giordano (Rome) and Caglagül Koz (Berlin).