Europe's top court rules against Lufthansa's €6b Covid-era bailout approval

EU court rejects Lufthansa's €6B pandemic bailout over legal flaws

LUXEMBOURG, April 23 - The European Court of Justice has sided with rival airlines in a dispute over state aid to Lufthansa, confirming the annulment of a €6 billion (US$7 billion; RM27.82 billion) recapitalisation granted during the Covid-19 crisis, reported German Press Agency (dpa).

The European Court of Justice (ECJ) on Thursday confirmed a 2023 ruling by a lower chamber, the General Court, that the European Commission was wrong to approve the financial aid, as the methods used to determine the share price were not in line with EU rules.

Lufthansa's competitors Ryanair and Condor had sued against the commission's approval.

In 2020, months after the start of the Covid-19 pandemic, the German government awarded the state aid to Germany's biggest airline to restore its balance sheet.

Lufthansa has since repaid the portion of the contested aid it had received in full by the end of 2022, partly replacing it with its own debt.

"We take note of the European Court of Justice's ruling," Lufthansa said.

Following the previous ruling of the General Court, the commission in 2024 launched a new investigation into the German measure to re-assess Lufthansa's eligibility for state aid.

Lufthansa said that the company "will engage constructively with the ongoing process and are in close contact with all the institutions involved." - Bernama-dpa