Ryanair 2016 Annual Report Download - page 116

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Item 8. Financial Information
CONSOLIDATED FINANCIAL STATEMENTS
Please refer to “Item 18. Financial Statements.”
OTHER FINANCIAL INFORMATION
Legal Proceedings
The Company is engaged in litigation arising in the ordinary course of its business. Although no assurance can
be given as to the outcome of any current or pending litigation, management does not believe that any such litigation will,
individually or in the aggregate, have a material adverse effect on the results of operations or financial condition of the
Company, except as described below.
EU State Aid-Related Proceedings. On December 11, 2002, the European Commission announced the launch of
an investigation into the 2001 agreement among Ryanair, the Brussels (Charleroi) airport and the government of the
Walloon Region of Belgium, the owner of the airport, which enabled the Company to launch new routes and base up to
four aircraft at Brussels (Charleroi). The European Commission’s investigation was based on an anonymous complaint
alleging that Ryanair’s arrangements with Brussels (Charleroi) constituted illegal state aid.
The European Commission issued its decision on February 12, 2004. As regards to the majority of the
arrangements between Ryanair, the airport and the region, the European Commission found that although they constituted
state aid, they were nevertheless compatible with the EC Treaty provisions and therefore did not require repayment.
However, the European Commission also found that certain other arrangements did constitute illegal state aid and therefore
ordered Ryanair to repay the amount of the benefit received in connection with those arrangements. On April 20, 2004,
the Walloon Region wrote to Ryanair requesting repayment of such state aid, although it acknowledged that Ryanair could
offset against the amount of such state aid certain costs incurred in relation to the establishment of the base, in accordance
with the European Commission’s decision. Ryanair made the requested repayment.
On May 25, 2004, Ryanair appealed the decision of the European Commission to the Court of First Instance
(“CFI”), requesting the court to annul the decision because:
 the European Commission infringed Article 253 of the EC Treaty by failing to provide adequate reasons for its
decision; and
 the European Commission misapplied Article 87 of the EC Treaty by failing to properly apply the Market
Economy Investor Principle (MEIP), which generally holds that an investment made by a public entity that would
have been made on the same basis by a private entity does not constitute state aid.
In March 2008, Ryanair had its hearing before the CFI, and in December 2008, the CFI annulled the European
Commission’s decision. Ryanair was repaid the €4.0 million that the Commission had claimed was illegal state aid. The
Belgian government has also withdrawn a separate €2.3 million action against Ryanair arising from the European
Commission’s decision.
In January 2010, the European Commission concluded that the financial arrangements between Bratislava airport
in Slovakia and Ryanair do not constitute state aid within the meaning of EU rules, because these arrangements were in
line with market terms. In July 2012, the European Commission similarly concluded that the financial arrangements
between Tampere airport in Finland and Ryanair do not constitute state aid. In February 2014, the European Commission
found that the financial arrangements between Aarhus, Berlin (Schönefeld) and Marseille airports, and Ryanair, do not
constitute state aid. In July 2014, the European Commission announced a ‘no state aid’ decision in respect of Dusseldorf
(Weeze) airport. In October 2014, the European Commission concluded that Ryanair’s agreements with the Brussels
(Charleroi), Frankfurt (Hahn), Alghero and Stockholm (Västerås) airports did not constitute State aid. In July and October
2014, the European Commission announced findings of state aid to Ryanair in its arrangements with Pau, Nimes,
Angouleme, Altenburg and Zweibrücken airports, ordering Ryanair to repay a total of approximately €10.4 million of