State aid: Commission approves €1.2 billion rescue loan; opens investigation into €3.2 billion Portuguese further restructuring aid in favour of TAP

By two separate decisions adopted today, the European Commission has (i) re-approved €1.2 billion rescue aid to Transportes Aéreos Portugueses SGPS S.A. (‘TAP Air Portugal’), and (ii) opened an investigation to assess whether the restructuring aid Portugal plans to grant to TAP is in line with EU rules on State aid granted to companies in difficulty. On 10 June 2020, the Commission adopted a decision approving a €1.2 billion rescue loan to TAP SGPS, finding that the aid was in line with the requirements of the Commission’s Guidelines on rescue and restructuring aid (‘R&R Guidelines’). By a judgment of 19 May 2021 (case T-465/20, Ryanair/Commission), the General Court of the European Union annulled the initial rescue aid decision. The General Court gave the Commission a possibility to adopt a new decision within two months, addressing these shortcomings. The decision adopted today re- approves the rescue aid and further specifies the reasons for approving the aid, in connection with the situation of the TAP group and its shareholders in June 2020. On 10 June 2021, Portugal formally notified to the Commission €3.2 billion restructuring aid, with the aim of financing a restructuring plan of TAP Group through TAP Air Portugal. The Commission has opened an in-depth investigation to further assess the compliance of the proposed restructuring plan and of the related aid with the conditions of the R&R Guidelines. The opening of an investigation gives Portugal and interested third parties the opportunity to submit comments. It does not prejudge the outcome of the investigation. Executive Vice-President Vestager, in charge of competition policy, said: “We have adopted a new decision re-approving rescue aid for the Portuguese TAP airline, following the recent judgment of the General Court annulling the Commission’s original decision. This ensures that the disbursed rescue aid to TAP will not have to be repaid, while efforts continue to develop a sound restructuring plan that ensures TAP’s viability in the long-term, without the need for continued State support. In this context, we have also opened an investigation into the restructuring aid notified by Portugal. We will continue our constructive engagement with the Portuguese authorities on this issue

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