EU law update: Ryanair’s German state aid ‘unlawful’

During September and October there have been some interesting decisions made by both the European Commission and the European Court of Justice. On October 15th, the Commission announced its decision that Ryanair has received unlawful state aid granted through Leipzig-Altenburg airport in Germany because the agreement between the parties is not capable of being profitable for the airport "even in the long run". Ryanair has announced its intention to appeal the decisions, which require it to repay more than €1 million to the relevant EU member states. Ryanair did receive better news on September 18th, when the Court of Justice ruled that national laws preventing airlines from charging a price supplement for checked-in baggage are in breach of EU law. However, the Court noted that hand baggage cannot be subject to a price supplement if it meets reasonable requirements.

Bus services

Arrangements to compensate State-owned Bus Éireann and

Dublin Bus

for the operation of bus services across Ireland and the transport of schoolchildren have also come under review. On October 15th, the Commission concluded the current arrangements were implemented before EU state aid rules were applicable to this sector (ie the arrangements constitute “existing aid”). When existing aid is illegal, the Commission does not ask the member state to recover the aid granted but rather asks it to bring the measure to an end. Whilst the compensation arrangements for the bus services ceased in December 2009, the arrangements for the transportation of schoolchildren are still in place and must be brought into line with EU state aid rules.

On September 3rd, the European Court of Justice gave a preliminary ruling that provides guidance on the interpretation of “parody” as an exception to copyright law. Deckmyn v Vandersteen was a Belgian case in which the copyright in a comic book drawing was allegedly infringed by a calendar produced by the Flemish nationalist party. In answering a number of questions posed by the Belgian Court of Appeal, the Court of Justice held that “parody” is an EU law concept that must be interpreted uniformly and in accordance with its usual meaning in everyday language in all member states. The Court also noted that the two essential characteristics of parody are to evoke an existing work while being noticeably different from it and to constitute an expression of humour or mockery.

On October 9th, Minister for Children James Reilly told the Dáil that the European Commissioner for Health and Consumer Policy, Tonio Borg, had informed him that "the Commission has made no negative comment" on Ireland's proposal to be the first EU country to introduce plain cigarette packaging. Notification of the proposal (as a "technical standard") to the European Commission was made last June. Ireland has received widespread support for the proposal from politicians, anti-smoking lobby groups and cancer charities, and there are signs that other EU member states (such as France) will soon follow suit. However, objections to the notification were submitted to the European Commission by the US Chamber of Commerce and nine European countries: Italy, Bulgaria, the Czech Republic, Greece, Poland, Portugal, Romania, Slovakia and Spain. Despite the objections, it appears that the commission itself is favourable to the proposal.

Kate Leahy and Victoria Balaguer are committee members of the Irish Society of European Law