Ryanair 2016 Annual Report Download - page 61

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not suffer a significant loss of reservations in the event of a major breakdown of its booking engine or other related systems,
which, in turn, could have a material adverse effect on Ryanair’s operating results or financial condition.
Since October 1, 2009, all Ryanair passengers have been required to use Internet check-in. Internet check-in is
part of a package of measures intended to reduce check-in lines and passenger handling costs and pass on these savings by
reducing passenger airfares. Ryanair has deployed this system across its network. Any disruptions to the Internet check-in
service as a result of a breakdown in the relevant computer systems or otherwise could have a material adverse impact on
these service-improvement and cost-reduction efforts. There can be no assurance, however, that this process will continue
to be successful or that consumers will not switch to other carriers that provide standard check-in facilities, which would
negatively affect Ryanair’s results of operations and financial condition.
The Company Faces Risks Related to Unauthorized Use of Information from the Company’s Website.
Screenscraper websites gain unauthorized access to Ryanair’s website and booking system, extract flight and pricing
information and display it on their own websites for sale to customers at prices which may include hidden intermediary
fees on top of Ryanair’s fares. Ryanair does not allow any such commercial use of its website and objects to the practice
of screenscraping also on the basis of certain legal principles, such as database rights, copyright protection, etc. Ryanair is
currently involved in a number of legal proceedings against the proprietors of screenscraper websites in Ireland, Germany,
The Netherlands, France, Spain, Italy and Switzerland. Ryanair’s objective is to prevent any unauthorized use of its
website. Ryanair does allow certain companies who operate fare comparison (i.e. not reselling) websites to access its
schedule and fare information for the purposes of price comparison provided they sign a license and use the agreed method
to access the data. Ryanair also permits Travelport (trading as Galileo and Worldspan), Amadeus and Sabre, GDS
operators, to provide access to Ryanair’s fares to traditional and corporate travel agencies. Ryanair has received favorable
rulings in Ireland and The Netherlands, and unfavorable rulings in Germany, Spain, France and Italy, in its actions against
screenscrapers. However, pending the outcome of these legal proceedings and if Ryanair were to be ultimately unsuccessful
in them, the activities of screenscraper websites could lead to a reduction in the number of customers who book directly
on Ryanair’s website and consequently to a reduction in Ryanair’s ancillary revenue stream. Also, some customers may
be lost to Ryanair once they are presented by a screenscraper website with a Ryanair fare inflated by the screenscraper’s
intermediary fee. This could also adversely affect Ryanair’s reputation as a low-fares airline, which could negatively affect
Ryanair’s results of operations and financial condition.
For additional details, see “Item 8. Financial Information—Other Financial Information—Legal Proceedings—
Legal Proceedings Against Internet Ticket Touts.”
Ryanair is Subject to Cyber Security Risks and May Incur Increasing Costs in an Effort to Minimize Those Risks.
As almost all of Ryanair’s reservations are made through its website, security breaches could expose it to a risk of loss or
misuse of customer information, litigation and potential liability. Although Ryanair takes steps to secure its website and
management information systems, the security measures it has implemented may not be effective, and its systems may be
vulnerable to theft, loss, damage and interruption from a number of potential sources and events, including unauthorized
access or security breaches, cyber-attacks, computer viruses, power loss, or other disruptive events. Ryanair may not have
the resources or technical sophistication to anticipate or prevent rapidly evolving types of cyber-attacks. Attacks may be
targeted at Ryanair, its customers and suppliers, or others who have entrusted it with information.
In addition, data and security breaches can also occur as a result of non-technical issues, including breaches by
Ryanair or by persons with whom it has commercial relationships that result in the unauthorized release of personal or
confidential information. Any such cyber-attack or other security issue could result in a significant loss of reservations and
customer confidence in the website and its business which, in turn, could have a material adverse effect on Ryanair’s
operating results or financial condition and potentially entail its incurring significant litigation or other costs.
The Irish Corporation Tax Rate Could Rise. The majority of Ryanair’s profits are subject to Irish corporation tax
at a statutory rate of 12.5%. There remains a risk that the Irish government could increase Irish corporation tax rates above
12.5% in order to repay current or future loans or to increase tax revenues.
At 12.5%, the rate of Irish corporation tax is lower than that applied by most of the other European Union member
states, and has periodically been subject to critical comment by the governments of other EU member states. Although the