An EU court has annulled a European Commission decision to approve aid granted by Italy to its airlines to help them cope with the effects COVID-19 disruption.

In a case taken by Ryanair, the General Court of the Court of Justice of the European Union (CJEU) found that the commission had failed to provide a statement of reasons for its finding that the measure was not contrary to EU laws on state aid.

The aid package, unveiled in 2020, consisted of subsidies paid out of a € 130 million compensation fund to certain airlines holding an Italian licence.

In its ruling, the EU court said that a decision not to initiate a formal investigation into state-aid measures notified to the commission “must set out the reasons for which the commission takes the view that it is not faced with serious difficulties in assessing the compatibility of the aid at issue with the internal market”.

‘Clear and unequivocal’

The court noted that while such a statement could be “succinct”, it had to set out “in a clear and unequivocal fashion” the reasons for decision not to conduct an investigation.

“The General Court finds that that has not been done here, however,” it said.

Earlier this month, the court upheld a Ryanair challenge linked to aid for the German airline Lufthansa.