competitionlaw

  Introduction The European Commission has declared that aid granted by Germany to holiday air carrier Condor on the basis of Article 107(2)(b) TFEU [1] .   Background Article 107(2)(b) TFEU allows Member States to grant compensation of damages directly caused by exceptional circumstances. Condor is a German charter airline that experienced significant revenue decline due to travel restrictions imposed by countries to deal with the Covid-19 pandemic, though the airline took up new activities such as   return flights for stranded passengers and cargo flights. Germany notified the European Commission a package aid to compensate Condor for the direct damage suffered because of the cancellation or re-scheduling of flights following the imposition of travel restrictions linked to the Covid-19 outbreak over the March 2020-December 2020 period. The aid consisted of two State-guaranteed loans with subsidized interest rates amounting to € 529.8 million and € 20.2 million, respectively

In the recent Haugesund Airport and TORP Sandefjord Airport cases the EFTA Surveillance Authority (ESA) has cleared Covid-19 compensation measures granted by Norway authorities to the airports of Haugensund and Sandefjord on the legal basis of Article 61(2)(b) of the EEA Agreement. Alike Article 107(2)(b) TFEU, Article 61(2)(b) allows ‘… aid to make good the damage caused by natural disasters or exceptional occurrences …’. The Norwegian authorities made grant in the form of the payment of a lump sum of NOK 90 million and NOK 56,8 million to the operators of the airports of Haugesund and Sandefjord, respectively. The ESA considered the grants as state aid but it authorizes them because they met all the compatibility conditions set out in Article 61(2)(b) of the EEA Agreement.   i) Exceptional circumstance The ESA qualified the Covid-19 outbreak as an exceptional occurrence because it was not foreseeable and is clearly distinguishable from ordinary events, falling outside the n