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The Temporary Framework for State Aid and Competition Law Enforcement in the Air Transport Sector during the COVID-19 Crisis

Paper provides for a systematic overview of the EU temporary scheme for the State aid and Public service obligation rules applicable to the air transport sector during pandemic. The air transport sector, along with the tourism and service sector, is among the economic sectors that are probably the most affected by the COVID-19 crisis. According to some estimations, the drop in passenger traffic in April 2020 compared to April 2019 rose up to 94.4%. In order to help air transport companies in Europe to overcome the financial troubles, to preserve jobs, to ensure the basic connectivity for passenger during COVID -19 crisis and to secure supply of essential food, medicals or other items EU Commission adopted a special legislative instruments allowing that way member states to support their air transport industry. Since in normal circumstances such practice would be considered as prohibited State aid the intention of this paper is, firstly, to analyse in what situation and under what conditions member states are under temporary State aid scheme entitled to support air transport sector during pandemic. Secondly, to explore to what extent and for what purposes different member states granted State aid to their airline industry. Special focus will be on the State aid measures provided by the Croatian government to Croatian Airlines. Authors will examine whether these state aid was in line with the EU temporary competition law and the legal framework for state aid. In the conclusion, authors will, in light of Ryan air allegations bring their own views as to whether thereby the member states with regard to State aid contrary to rules prescribed by the EU Commission’s Temporary framework.

state aid ; COVID-19 ; temporary framework ; competition law ; Air Transport Sector

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