EN Official Journal of the European Union L 201/48

COMMISSION DECISION (EU) 2015/1226

of 23 July 2014

on State aid SA.33963 (2012/C) (ex 2012/NN) implemented by France in favour of Angoulême Chamber of Commerce and Industry, SNC-Lavalin, Ryanair and Airport Marketing Services

(notified under document C(2014) 5080)

(Only the French text is authentic)

(Text with EEA relevance)

THE EUROPEAN COMMISSION,

Having regard to the Treaty on the Functioning of the European Union, and in particular the first subparagraph of Article 108(2) thereof (1),

Having regard to the Agreement on the European Economic Area, and in particular Article 62(1)(a) thereof,

Having called on interested parties to submit their comments pursuant to those articles (2), and having regard to their comments,

Whereas:

1. PROCEDURE

(1) By letter dated 26 January 2010, the airline Air France lodged a complaint about advantages which the airline Ryanair was allegedly enjoying at a number of regional and local French airports. In the case of Angoulême Brie Champniers airport (‘Angoulême airport’), the complaint also referred to financial support allegedly received by the managing body of the airport, Angoulême Chamber of Commerce and Industry (‘Angoulême CCI’).

(2) By letter dated 16 March 2010, the Commission sent the French authorities a non-confidential version of the complaint and asked them for explanations concerning the measures at issue. The French authorities sent answers by letters dated 31 May and 7 June 2010.

(3) By letter dated 2 November 2011, Air France sent additional information in support of its complaint. The Commission forwarded this information to France and asked it for additional information by letter dated 5 December 2011. On 22 December 2011 the French authorities requested an extension of the deadline for replying, to which the Commission agreed by letter dated 4 January 2012. The French authorities sent their comments and their replies by letter dated 20 January 2012.

(4) By letter dated 21 March 2012, the Commission notified France of its decision to initiate the formal investigation procedure laid down in Article 108(2) TFEU concerning the potential aid to Angoulême airport and to the airline Ryanair. The Commission decision (the ‘opening decision’) was published in the Official Journal of the European Union (3) on 25 May 2012.

(5) The French authorities sent their comments and their replies to the questions set out in the opening decision and to the Commission’s subsequent questions by letters dated 22 May and 21 September 2012.

(6) Air France, Ryanair and Airport Marketing Services (‘AMS’) submitted their comments within the deadlines provided for in the opening decision. By letters dated 20 August 2012 and 3 May 2013, the Commission forwarded these comments to the French authorities. France, by letters dated 12 September 2012 and 7 June 2013, informed the Commission that it did not have any additional observations to make in this respect.

(7) The Commission received additional comments from Ryanair dated 13 April 2012, 10 April 2013, 20 December 2013, and 17 and 31 January 2014. These additional comments were sent to France by letters dated 13 July 2012, 3 May 2013, 9 and 23 January 2014 and 4 February 2014. France, by letters dated 17 July 2012, 4 June 2013, 29 January 2014, 3 February 2014 and 21 May 2014, informed the Commission that it did not have any additional observations to make in this respect.

(8) On 24 February, 13 and 19 March 2014, following the adoption of the Guidelines on State aid to airports and airlines (the ‘new guidelines’) (4), the Commission invited France and the interested parties to submit their comments on the application of the new guidelines, in particular to the present case. On 19 March 2014, the French authorities submitted observations in this regard.

(9) Furthermore, on 15 April 2014, a notice was published in the Official Journal of the European Union (5), inviting the Member States and interested parties to submit their comments, including in this case, in the light of the entry into force of the new guidelines. Air France and Transport & Environment submitted their comments within the stipulated deadlines. By letters dated 28 May 2014, the Commission forwarded these comments to the French authorities. France, by letter dated 21 May 2014, informed the Commission that it did not have any observations to make.

2. THE FACTS

2.1. Operators and owners of the airport infrastructure

(10) Angoulême airport was managed by Angoulême CCI until 2011. By ministerial decree of 20 September 2002, the State, which owned the airport at that time, granted a concession over the airport to Angoulême CCI for five years. The agreement (6) concluded by Angoulême CCI with the state provided that Angoulême CCI was responsible for the construction, maintenance and operation of the airport. To that end, Angoulême CCI, acting as the operator and manager of Angoulême airport (‘CCI-airport’), had separate accounting from Angoulême CCI’s general department (7). By an order of the Prefect of 22 December 2006, the ownership of Angoulême airport was then transferred to the Syndicat mixte des aéroports de Charente (‘SMAC’). SMAC therefore replaced the state as the conceding authority on 1 January 2007. From that date, all the investments and financing of the airport were the responsibility of SMAC.

(11) SMAC is responsible for fitting out, equipping, maintaining, managing and operating Angoulême airport, and includes the département of Charente (‘CG16’), the Communauté d’agglomération du grand Angoulême (‘Comaga’), the Communauté des communes de Braconne Charente (‘CCBC’), Angoulême CCI, the Communauté des communes de Cognac (‘CCC’) and the Cognac Chamber of Commerce and Industry. As stated in the opening decision (8), SMAC’s statutes provide for the allocation between its members of the expenditure incurred in relation to Angoulême airport.

(12) After extending the concession to Angoulême CCI until 31 December 2008, SMAC concluded a management subcontracting agreement with Angoulême CCI on 22 January 2009 (‘2009 subcontracting agreement’). With effect from 1 January 2009, for a period of three years, the investments undertaken for airport operations were the responsibility of SMAC rather than CCI-airport.

(13) Lastly, following a competitive tendering procedure, since 1 January 2012 the management and operation of the airport have been the responsibility of the private company SNC-Lavalin (9).

2.2. Airport characteristics and traffic

(14) As was pointed out in the opening decision, Angoulême airport is located in the département of Charente and is open to national and international commercial traffic. It is located 75 km from Périgueux and Limoges airports, 80 km from Niort airport, and approximately 120 km from La Rochelle and Bordeaux airports. Table 1 Airports neighbouring Angoulême airport (10) Niort Périgueux Limoges La Rochelle Bordeaux Duration in mins 93 106 79 119 102 Distance in km 108 110 97 156 127

(15) A scheduled air service subject to a public service obligation (PSO) between Angoulême and Lyon, operated by Twin Jet, was discontinued in April 2007. In 2008 and 2009, Ryanair operated a service to London Stansted from April to October, with a frequency of three weekly rotations. From 2004 to 2011, the other commercial movements at Angoulême airport were mainly flights by flying clubs, helicopter clubs and business flights.

(16) Passenger traffic at Angoulême airport, as summarised in Table 2 below, places it in category D of paragraph 15 of the 2005 Community Guidelines on financing of airports and start-up aid to airlines departing from regional airports (11) (the ‘2005 Guidelines’). Table 2 Traffic and movements at Angoulême airport (12) Passengers of which, Ryanair % scheduled service Movements 2004 5 496 0 85,53 % 26 731 2005 6 789 0 89,45 % 28 328 2006 6 553 0 94,26 % 24 381 2007 2 362 0 66,30 % 22 868 2008 25 596 24 494 95,69 % 22 650 2009 28 216 27 490 97,43 % 31 358 2010 345 0 0,00 % 24 632 2011 (13) 394 0 0,00 % 26 060

(17) Analysis of Angoulême airport’s financial situation shows that the management of the platform made substantial losses in the periods in question. The total contributions paid to the airport managing body for operating the airport during the period 2004-2011 were EUR 1 0 2 32 310 (14). Non-state investments made by the airport managing body during the period 2004-2011 amounted to EUR 1 2 77 000. They were financed by the interested regional and local authorities, then by SMAC and CCI-airport (15).

3. DETAILED DESCRIPTION OF THE MEASURES

3.1. Financial support for the airport

3.1.1. Contractual framework for subsidies to the airport

(18) Part of Angoulême airport’s investments and operating deficit were paid for by CG16, Comaga and CCBC under a partnership agreement (16) (‘2002 Agreement’) with Angoulême CCI. This agreement followed the award by the state of a local public equipment concession. As a result, until 31 December 2006, CG16, Comaga and CCBC provided financial support to Angoulême CCI for operating the airport (17). SMAC took over the commitments referred to in the 2002 Agreement with effect from 1 January 2007.

(19) Under the 2009 subcontracting agreement, SMAC covered the operating deficit of CCI-airport for the period 2009-2011. The breakdown of the contributions between the member organisations of SMAC in respect of the expenditure attributable to Angoulême airport remain, for this period, identical to that provided for by the 2002 Agreement.

(20) Lastly, as noted above, SNC-Lavalin has been operating Angoulême airport since 1 January 2012 under a six-year public operating contract awarded by SMAC (18). Every participant in the call for tenders (19) had to propose a strategic development plan for a ‘baseline scenario’ (20) and a ‘proactive scenario’ (21). The delegating authority chose the second scenario.

3.1.2. Investments in infrastructure

(21) Details of the contributions actually paid to CCI-airport by the different public authorities to finance investments in airport infrastructure are set out in the opening decision (22). The Commission points out that the non-state investments made by CCI-airport during the period 2004-2011 amounted to EUR 1 2 77 000. They were financed by the interested regional and local authorities (CG16, Comaga, CCBC), then by SMAC and CCI-airport.

(22) These investments were intended to extend the runway by 50 metres so that Angoulême airport had the technical characteristics required to host airlines that could contribute to the growth of air traffic. The French authorities also argue that the work to fit out the airport and the modular installations were intended to comply with the regulations applicable to establishments serving the public.

(23) With the exception of state prerogatives, SMAC has been responsible for the cost and supervision of investments for fitting out and equipment since 1 January 2012. Although no definitive programme has been drawn up, these investments were estimated at EUR 1 2 00 000 during the period 2012-2017 (23).

3.1.3. Financing of the costs associated with state tasks

(24) The 2002 Agreement explicitly excludes from its scope investments directly linked to state tasks. According to the French authorities, these costs (24) cover operational expenditure, safety equipment (25) and security equipment (26). This expenditure can be broken down as follows: Table 3 Security and safety expenditure (EUR) Year 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Safety 2 44 858 2 34 727 2 43 989 2 55 209 2 92 450 2 55 555 5 36 194 5 17 307 4 63 595 3 15 065 Security 59 490 1 08 626 1 20 002 1 30 078 1 11 919 59 943 2 76 869 2 54 428 57 206 45 269 Overheads 0 0 0 0 0 0 0 77 174 52 080 36 033 Total 3 04 348 3 43 353 3 63 991 3 85 287 4 04 369 3 15 498 8 13 063 8 48 909 5 72 881 3 96 367

(25) This expenditure was covered, pro rata the depreciation charges, by the airport tax and additional subsidies from the Intervention Fund for Airports and Air Transport (Fonds d’intervention pour les aéroports et le transport aérien — FIATA), which were replaced from 2008 by an increase in the airport tax. The airport tax, which is established by Article 1609 quatervicies of the General Tax Code, is collected by airport operators whose enplaned and deplaned traffic exceeds 5 000 passengers during the previous calendar year. A ministerial order lays down the list of airports concerned and the amount of the tax for each airport (27).

(26) According to the French authorities, the resources collected may be broken down as follows: Table 4 Income from resources allocated to financing state activities (EUR) Year 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Revenue from the tax 45 560 48 704 26 087 30 657 32 673 11 995 1 30 734 82 1 359 1 644 Increase 0 0 0 0 0 0 7 86 190 8 38 362 5 82 712 1 33 340 FIATA 3 89 000 1 31 802 2 96 639 3 36 184 3 07 806 5 90 775 0 0 0 0 Total 4 34 560 1 80 506 3 22 726 3 66 841 3 40 479 6 02 770 9 16 924 8 38 444 5 84 071 1 34 984

3.1.4. Operating subsidies

(27) Until 2008, CG16, Comaga and CCBC covered the operating deficit and paid the loan instalments in accordance with the 2002 Agreement; Angoulême CCI paid the balance of any deficit by a contribution from its general department (28). The ceiling on the annual deficit covered by the parties to the 2002 Agreement, which was initially set at EUR 3 50 000, was increased from 2004. Lastly, SMAC offset the entire operating deficit of CCI-airport from 2008 and after 1 January 2009, the date on which SMAC made a commitment under the 2009 subcontract.

(28) In total, the contributions paid to CCI-airport for the operation of Angoulême airport during the period 2004-2011 are as follows: Table 5 Amount of operating subsidies received by CCI-airport (thousand EUR) Year 2004 2005 2006 2007 2008 2009 2010 2011 Grants 801,38 999,23 1 295,37 1 222,77 1 896,21 1 679,63 1 313,90 1 023,82

(29) Since 2012, SNC-Lavalin has been operating the airport under a procurement contract. The baseline scenario and the proactive scenario described above (see footnotes 17 and 18) set out, on the basis of the forecast operating result, the maximum amount of the balancing contribution financed by SMAC and the level of the flat-rate remuneration awarded to the delegatee. The offers submitted by SNC-Lavalin were as follows: Table 6 Ceiling on operating subsidies and remuneration granted to SNC-Lavalin (including taxes) — Baseline scenario (EUR) Year 2012 2013 2014 2015 2016 2017 Balancing contribution 4 01 000 3 64 000 3 74 000 3 57 000 3 50 000 3 42 000 Remuneration 1 79 400 1 79 400 1 79 400 1 79 400 1 79 400 1 79 400 Total 5 80 400 5 43 400 5 53 400 5 36 400 5 29 400 5 21 400 Table 7 Ceiling on operating subsidies and remuneration granted to SNC-Lavalin (including taxes) — Proactive scenario (EUR) Year 2012 2013 2014 2015 2016 2017 Balancing contribution 4 64 722 4 25 471 4 48 416 3 84 230 3 41 228 2 96 389 Remuneration 1 79 400 1 79 400 1 79 400 1 79 400 1 79 400 1 79 400 Total 6 44 122 6 04 871 6 27 816 5 63 630 5 20 628 4 75 789

3.2. Fee framework for Angoulême airport

(30) Angoulême CCI took four successive fee decisions, of which the latter two were approved by SMAC: Table 8 Aeronautical charges at Angoulême airport (EUR) Charges as at 15.6.2003 Charges as at 1.12.2005 Charges as at 1.1.2009 Charges as at 1.6.2010 Landing Several categories Several categories Several categories Several categories B737-800 landing 284,56 296,77 296,81 305,94 Runway lighting 26,25 27,35 27,35 35,00 Parking (per hour and per tonne beyond 2 h) 0,25 0,26 0,26 0,27 EU passengers 3,61 3,76 2,76 2,85 Fee for disabled passengers/passengers with reduced mobility (29) — — — 0,42

(31) Companies planning scheduled flights could be the subject of a specific agreement, depending on the services required. In that context, rebates could be granted (30).

3.3. Relations with Ryanair

3.3.1. Contracts concluded with Ryanair and Airport Marketing Services

(32) Following the publication of a European call for projects (31), two contracts were concluded on 8 February 2008 between SMAC and, first, Ryanair and, second, Airport Marketing Services, a wholly owned Ryanair subsidiary (‘AMS’). The purpose of these two contracts (‘the 2008 Agreements’) was to establish a scheduled air service between Angoulême and London Stansted.

(33) The contract concluded with Ryanair concerns airport services (the ‘Airport Services Agreement’). The contract concluded with AMS (the ‘Marketing Services Agreement’) relates to promotion and marketing of the route.

(34) The 2008 Agreements were concluded for a duration of five years from the launch of the route (32). Although no comparable agreement was concluded with another airline, the charges decision of 1 March 2009 sets out all of the charges measures. That decision refers to a ‘contribution to the development of the route’ of EUR 15, EUR 12 and EUR 9 per passenger respectively for the first three years after the launch of the route, limited to EUR 4 00 000, EUR 3 00 000 and EUR 2 25 000. The last measure does not feature in the 2010 charges decision.

3.3.2. Airport Services Agreement

(35) Under the Airport Services Agreement, Ryanair undertook to operate three flights a week during the summer period (33). Moreover, as stated in the opening decision (34), SMAC granted Ryanair certain reductions in relation to the general schedule of charges in force: Table 9 Airport charges applicable to Ryanair (EUR) Year 2008 2009 2010 2011 2012 Charge per passenger 1,18 1,44 2,1 2,76 2,76 Landing charges per rotation 252,29 252,29 252,29 252,29 252,29 Ground handling charges per rotation 195 245 245 245 245

(36) SMAC undertook to maintain the level of these charges for the duration of the contract and not to impose other charges, directly or indirectly (35). Lastly, the Airport Services Agreement provided that Ryanair would pay a penalty if it terminated the agreement (36). If Ryanair terminated the agreement before the end of the third year of application, the clause provided that Ryanair would pay EUR 17 000 for the fourth year and EUR 8 500 for the fifth year.

3.3.3. Marketing Services Agreement

(37) The Marketing Services Agreement is based explicitly on Ryanair’s undertaking to operate the Angoulême-London Stansted route described in the Airport Services Agreement (37). Under that agreement, AMS undertook to provide marketing services on Ryanair’s website during the first three years of the agreement, in return for a payment by SMAC (38).

(38) Moreover, although the Marketing Services Agreement was signed by AMS, it (39) provided that, if Ryanair terminated the agreement before the end of the third year of application, Ryanair would pay SMAC a penalty of EUR 50 000 for the fourth year and EUR 25 000 for the fifth year.

3.3.4. Implementation of the agreement by SMAC, Angoulême CCI and Ryanair/AMS

(39) In 2008 and 2009, Ryanair’s commercial activity accounted for between 95 % and 97 % of traffic at Angoulême airport. This activity used between 25 % and 28 % of the airport’s overall theoretical capacity, estimated by the French authorities at 1 00 000 passengers per year.

(40) The financial flows between the airport manager, SMAC, Ryanair and AMS from 2008 to 2010 are broken down as follows: Table 10 Financial flows between 2008 and 2010 (EUR) 2008 2009 2010 Total Fees 54 086 70 294 0 1 24 380 Marketing support (40) 4 00 000 3 00 000 0 7 00 000 Net transfer (41) 4 54 086 3 70 294 0 8 24 380

(41) The 2008 Agreements were not implemented after 2009. After having initially made the continuation of the service in 2010 conditional on the cessation of the payments provided for by the Marketing Services Agreement of EUR 2 25 000 for the third year and EUR 4 00 000 for the fourth year, then on the maintenance of the volume of services provided for in the Marketing Services Agreement but with a limit on the service to two months in summer instead of the eight months stipulated in the agreement, Ryanair gave notice that it would terminate the route.

(42) On 28 June 2010, SMAC submitted a claim for damages to the Poitiers Administrative Court for the loss suffered because of cessation of operations. Ryanair referred the matter to the London Court of International Arbitration, whose jurisdiction SMAC has since challenged before the Council of State. The latter proceedings are currently pending.

4. GROUNDS FOR INITIATING THE FORMAL INVESTIGATION PROCEDURE

(43) In its decision to initiate the formal investigation procedure, the Commission expressed doubts about the financial support to the airport’s operators (42).

(44) The Commission first expressed doubts about the scope of the non-economic activities likely to be paid for by the public authority. The Commission stressed that the inclusion of all of Angoulême airport’s activities within the scope of a service of general economic interest (SGEI) was likely to be vitiated by a manifest error of assessment in the light of the first condition laid down by the Altmark (43) judgment.

(45) Second, the Commission had doubts about compliance with the second condition in the Altmark judgment, according to which the parameters used to determine the amount of compensation in respect of the activities carried on must be established in advance.

(46) Third, the Commission had doubts about the level of compensation granted to SNC-Lavalin for the costs incurred in discharging the public service obligations (third condition laid down by Altmark). Fourth, the Commission had serious misgivings about the procedure for selecting the service providers (fourth condition in Altmark), including in relation to the period of operation guaranteed by SNC-Lavalin in the absence of any information on the competing bid.

(47) Furthermore, the Commission expressed doubts about the measures granted to Ryanair. After establishing the existence of a potential link between the Airport Services Agreement and the Marketing Services Agreement, the Commission took the view that Ryanair had not paid a market price for the use of the airport services (44).

5. COMMENTS BY FRANCE

5.1. Financial support for the airport

5.1.1. On the classification as aid

5.1.1.1. On the concept of economic activity

(a) Entities operating the airport

(48) The French authorities point out first that SMAC has retained responsibility for investments and commercial policy. It is the sole signatory of the agreements with Ryanair. The French authorities take the view that this intervention in the operation of the airport is justified by the public interest tasks which are the responsibility of the public authorities.

(b) Legal basis for assessing the public financing of infrastructure

(49) The French authorities consider that the assessment of the financing of the airport infrastructure should be carried out on the basis of the 1994 Guidelines (45). They thus take the view that point 12 thereof excludes any scrutiny of this financing under the State aid rules. They add that the classification of airport activities and infrastructure was subject to legal uncertainty before the entry into force of the 2005 Guidelines. The position of the General Court of the European Union has not been sufficient to establish clearly the economic nature of the activities of managing and operating an airport.

(c) Prerogatives of a public authority

(50) The French authorities emphasise that the Commission, in its decision on Leipzig airport (46), took the view that certain airport infrastructure associated with the exercise of prerogatives linked to public safety, firefighting and operating safety, could not be classified as economic activities. According to the French authorities, these security and safety measures (47) are financed by the revenue from the airport tax (48). The tax is set every year in the light of the costs to be covered and collected for the benefit of the public or private bodies operating airports where activity exceeds 5 000 traffic units (49). This mechanism is justified by the specific security and safety constraints that go beyond simple operating requirements.

(51) The French authorities indicate that some of the expenditure is covered only partially (50). Furthermore, the data declared by the airport operators may be checked in relation to the current year and the previous two years.

(52) The French authorities state that this mechanism does not result in any overcompensation. First, the airport tax is not used to reimburse expenditure until the declared data have been checked. Second, the investments are compensated for pro rata the investment allocations. Next, any positive balance is carried over to the following years and carries charges payable by the operator. In this connection, the French authorities refer to a frequent financing deficit from the airport tax because of the increase in security and safety costs (51).

(53) Moreover, the French authorities point out that Angoulême CCI bears other costs related to the exercise of public powers, in accordance with the agreement and the concession specifications. In this regard, the operator provided the Air Flight Information Service (AFIS) (52) when the state was not providing air traffic control. Furthermore, when the state was responsible for this activity, the operator paid the state a contribution towards the costs of the service (53). In application of the subcontracting agreement signed by CCI and SMAC, it was Angoulême CCI that pursued the introduction of an AFIS service outside the hours of operation of air traffic control by the State. The French authorities consider that the costs resulting from these tasks, which were borne by Angoulême CCI, are as follows: (thousand EUR) Year 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 AFIS 113 114 115 117 125 122 82 63 44 37 Air traffic control 0 0 0 0 0 0 240 0 0 0 Total 113 114 115 117 125 122 322 63 44 37

(54) Lastly, the French authorities refer to the financing by Angoulême CCI, the regional and local authorities and SMAC of renovation work on the control tower in 2004 and 2005 costing EUR 84 800 and work on runway lighting and an uninterruptible power supply for the aprons in 2008 costing EUR 89 300.

5.1.1.2. Existence of a selective advantage

(55) With regard to the financing of infrastructure and operations outside the scope of state activities, the French authorities stress first that the public authorities which participated in the financing of Angoulême airport did not solely pursue profit. They also took account of the economic and social benefits to the region. As a result, the market economy investor test is not sufficient to justify this financing. However, the French authorities refer to SMAC’s desire to optimise the operation of the airport in order to limit the contribution that it paid. In support of their position, the French authorities refer to the contractual ceiling on the guaranteed deficit that was introduced following the call for tenders and the rationalisation of the forecast rate of investments for the duration of the agreement.

5.1.1.3. Effect on competition and trade

(56) The French authorities maintain that the public financial support granted to Angoulême airport does not affect competition. Bearing in mind that Périgueux, Limoges, Niort, La Rochelle and Bordeaux airports are more than one hour’s drive (54) from Angoulême airport, they take the view that those airports should not be included in the latter’s catchment area.

(57) What is more, Niort airport is not suitable for commercial flights. Such traffic is virtually non-existent there. Périgueux airport can accommodate only twin turbo-prop aircraft having a seating capacity under 60, which do not correspond to the characteristics of the European medium-haul aircraft operated by most low-cost carriers. A review of the passenger traffic with London from Bordeaux, Limoges and La Rochelle does not reveal any significant variation in traffic linked to the opening and closing of the Angoulême-London Stansted route: Pax London Angoulême Limoges La Rochelle Bordeaux 2007 0 0 1 12 257 83 171 2008 24 494 0 1 00 312 88 826 2009 27 490 94 133 60 432 80 073 2010 0 81 817 54 773 1 43 171 (55)

(58) Furthermore, the French authorities take the view that the rail connections to Angoulême do not compete with the air route to London. These markets are distinct because of the price and time differential with the TGV and Eurostar high-speed trains. In addition, the intermodality between the TGV and Bordeaux airport is practically nil because there is no high-speed link between Tours, Angoulême and Bordeaux.

(59) More generally, the French authorities refer to the 2005 Airline Guidelines, which state that ‘funding granted to small regional airports (category D) is unlikely to distort competition or affect trade to an extent contrary to the common interest’. Notwithstanding the above considerations, the French authorities take the view that only Bordeaux, Limoges and La Rochelle airports are potentially located in the catchment area of Angoulême airport, having regard to their traffic and characteristics.

(60) However, the fact that Ryanair has opened routes to London Stansted from La Rochelle and Limoges airports means that airlines regard them as separate markets. In the same way, the journey time from the city of Angoulême to Bordeaux, Limoges and La Rochelle airports, which is similar to the flight time between Angoulême and London Stansted, is a dissuasive factor for the inhabitants of Angoulême.

(61) Consequently, the French authorities consider that the criterion of effect on competition is not met and that the Commission’s objections to the public financing in favour of Angoulême airport cannot be justified because one of the essential conditions for the application of Article 107(1) TFEU is not satisfied in this case.

5.1.2. Compatibility with the internal market

5.1.2.1. Compatibility under Article 106(2) TFEU

(62) The French authorities consider that the financing granted to the managers of Angoulême airport could be found compatible with the internal market and exempted from notification even in the event that not all the conditions established by the Altmark judgment were fulfilled. They take the view that this airport should be regarded overall as an SGEI intended to participate in regional economic development. According to the French authorities, such compatibility is directly based on Article 106(2) TFEU and on the Commission Decision 2005/842/EC (the ‘2005 SGEI Decision’) (56) for the period before 30 January 2012. It is further based on Commission Decision 2012/21/EU (the ‘2011 SGEI Decision’) (57)

(a) Period under the management of Angoulême CCI and Angoulême CCI associated with SMAC

(i) Existence of entrustment

(63) The French authorities consider that the entrustment of the public-service task to Angoulême CCI flows from Article 170-1 of the Code of Commerce. Under that provision, the establishment contributes ‘to economic development, to the attractiveness and land planning of the territory and to the support of undertakings and of their associations by fulfilling … any public-service task and any task of general interest necessary to the accomplishment of those tasks’. To that end, ‘every establishment … may carry out … a task of creating and managing installations, in particular ... airports …’.

(64) The French authorities add that this legal framework supplements the acts conferring on Angoulême CCI the responsibility for managing and operating the airport. This has resulted in the entrustment to Angoulême CCI of the construction and management of airport infrastructure. The same applies to the decisions by which Angoulême CCI and the regional and local authorities involved determined their participation in the financing of the airport.

(ii) Amount of compensation

(65) The French authorities take the view that the budgetary and accounting framework applicable to Angoulême CCI (58) was such as to avoid any overcompensation.

(66) In general, a specific budget item was allocated to airport activities. Moreover, the monitoring was the outcome of the vote on the airport budget, after validation by the Bureau (59) of Angoulême CCI, by the elected members of Angoulême CCI. In this regard, the French authorities point out that the preparation of the budget is supported by documents concerning the state of operating transactions, self-financing capacity, capital transactions, the schedule of services provided and interdepartmental contributions and the schedule of employees and wage bill.

(67) In the same way, the French authorities argue that the statutes of SMAC refer to its object, which consists entirely in providing a public airport service. The airport activities are the subject of a specific budget. The French authorities add that the budget is voted by the SMAC committee. Furthermore, any new measure and any exceeding of the previous budget by 5 % must be approved by qualified majority.

(68) Lastly, the French authorities consider that reporting at regular intervals verifies that the budget voted is implemented, which precludes any overcompensation. The general meeting votes again in n+1 to accept the implemented budgets. A final level of monitoring is assured by sending the accounts of Angoulême CCI to the Prefecture, which checks that the accounts have been properly prepared. Until 31 December 2006, the Civil Aviation Authority issued an opinion on compliance. SMAC approves the initial, amended and implemented budgets in its capacity as concession-granting authority.

(b) Period under the management of SNC-Lavalin and SMAC

(i) Existence of entrustment

(69) The French authorities take the view that the definition of the general economic interest tasks entrusted to SNC-Lavalin are included in the specifications of the call for tenders and the technical clauses (60). They say that the development of the airport platform is an integral part thereof.

(ii) Amount of compensation

(70) The French authorities state that the income statements of CCI-airport show that there is no overcompensation.

(71) In addition to the separation of accounts guaranteed by the creation of a subsidiary of SNC-Lavalin (61), the absence of overcompensation is ensured by the monitoring carried out by SMAC (62), which is intended to avoid the overcompensation of its contribution to the cost of the tasks of general economic interest.

(72) The French authorities also take the view that the remuneration of SNC-Lavalin was not unreasonable. First, the tenderer had to set the maximum guarantee requested by SMAC in order to balance its operation, under the baseline scenario (operation without commercial traffic) and the proactive scenario (operation with commercial traffic). If the proactive scenario had been accepted, the French authorities stress that the bid by SNC-Lavalin was the lowest in financial terms. Second, they maintain that the expenditure borne by SMAC during the 2012 financial year, without commercial traffic, was EUR 6 44 000 compared with EUR 8 10 000 in 2010.

(73) Lastly, the French authorities point out that the burden of the property tax weighed on SMAC, which, as the property owner, had chosen not to pass it on to the operator.

(74) The French authorities therefore consider that the financing granted to the operators of Angoulême airport may be declared compatible with the internal market on the basis of Article 106(2) TFEU and of the 2005 SGEI Decision for the period before 30 January 2012 and on the basis of the 2011 SGEI Decision after that.

5.1.2.2. Compatibility under Article 107(3)(c) TFEU

(a) Infrastructure investments

(75) If the Commission were to decide that the public subsidy for infrastructure investments constituted State aid within the meaning of Article 107(1) TFEU, the French authorities take the view that the subsidy should be regarded as compatible with the internal market in accordance with the 2005 Guidelines.

(i) Clearly defined objective of general interest (criterion 1)

(76) The French authorities take the view that economic and tourism development in the département of Charente is a clearly defined objective of general interest. They consider that Commission practice (63) authorises the public administration to regard the development of a regional airport as such an objective.

(ii) The investments are necessary and proportional to the objective which has been set (criterion 2)

(77) These investments satisfied the criteria of necessity and proportionality. In this context, the French authorities refer to a study (64) justifying the creation of a structure bringing together all of the regional and local authorities and the public and professional tourism bodies with the express interest of developing Angoulême airport rather than another infrastructure and carrying out an assessment of the minimum investments required.

(iii) Satisfactory medium-term prospects for use (criterion 3)

(78) The French authorities state that the same study forecast traffic in the medium term of more than 1 00 000 passengers per year, which would correspond to a satisfactory medium-term prospect for use. According to the French authorities, the forecasts were based on the assumption of an increase in the frequency of the first route to London and the opening of a second route.

(iv) Equal and non-discriminatory access to infrastructure (criterion 4)

(79) The French authorities emphasise that access to the infrastructure was non-discriminatory. The only constraint on using the infrastructure at Angoulême airport was linked to the limit imposed by the capacity of the apron and the terminal. The incentives had been opened to any airline launching a new route, although only Ryanair had actually benefited.

(v) Absence of effect on trade contrary to the common interest (criterion 5)

(80) The French authorities state that the mere fact that Angoulême airport is classified under category D of the 2005 Airline Guidelines is sufficient to demonstrate that competition is not affected to an extent contrary to the common interest.

(vi) Necessity and proportionality of the aid (criterion 6)

(81) The French authorities consider that the 100 % public financing of the investments was necessary to maintain the airport’s potential and development. They take the view that this requirement justified an allocation of the investment financing between SMAC and the operator by the subcontract dated 22 January 2009. This situation is to be distinguished from that which, from 2012, led SMAC to pay annual remuneration of EUR 1 79 400 for the provision of services following a call for tenders. The French authorities point out that this legal framework did not provide for SMAC to carry out investments, but that it should act as project manager for the investments proposed by the service provider or decided by SMAC.

(b) Operational financing

(82) The French authorities state first that Angoulême CCI granted advances to the airport from 1984 to 2001. They consider that this period should remain outside the scope of the Commission’s investigation. After this period, the other aid was paid by way of operating aid.

(83) Then, leaving aside the financing of investments, the French authorities state that the deficit covered by the regional and local authorities was limited to EUR 3 50 000 in the 2002 and 2003 financial years (65). They add that, with regard to the 2004-2006 financial years, the decisions by the airport board were not minuted. The general department of Angoulême CCI provided the amount needed to balance the budget as implemented.

(84) Lastly, the French authorities consider that the operational financing does not affect competition for the reasons cited in recitals 56 to 61 of this Decision. Accordingly, they believe that the criterion relating to an effect on competition is not fulfilled and that the public operational financing of Angoulême airport cannot constitute aid within the meaning of Article 107(1) TFEU.

(85) The French authorities also argue that, if the financing in question were aid, it should be found compatible with the internal market and exempted from notification. In this regard, they rely on the 2005 Guidelines and the 2005 SGEI Decision.

5.2. Relations with Ryanair

5.2.1. On the classification as aid

(86) The French authorities take the view, first, that the Airport Services Agreement and the Marketing Services Agreement must be assessed together. Second, they believe that SMAC did not reason as a prudent market-economy investor, for the reasons set out in recital 55 of this Decision. According to the French authorities, it is the absence of a response to the call for projects launched for the opening of international air routes that prompted Angoulême CCI, following a mandate approved by SMAC, to negotiate with Ryanair the opening of a route between London Stansted and Angoulême.

(87) They also stress the fact that the objective of the improvement works (66) begun in 2006 was not to satisfy a specific company but to enable airlines to be accommodated. However, they point out that the absence of other airlines regularly using the airport resulted in virtually all of these investments being allocated to Ryanair.

(88) With regard to the costs of commercial relations with Ryanair, the French authorities point out that the airport operator had to incur additional staff costs. They refer to a difference between forecast and actual costs: Safety Benchmark 2007 Change 2008/2007 Change 2009/2007 Change 2010/2007 Forecast Actual Forecast Actual Forecast Number of staff 5 + 6 + 6 + 6 + 6 + 6 Full-time equivalent 4,6 + 1,46 + 1,35 + 3 + 1,35 + 3 Wage costs (thousand EUR) 219,1 + 137,4 + 116,8 + 109,3 + 52,17 + 133,1 Security Benchmark 2007 Change 2008/2007 Change 2009/2007 Change 2010/2007 Forecast Actual Forecast Actual Forecast Number of staff 10 — — — — — Full-time equivalent 0,7 + 1,4 1,6 + 2 + 1,6 + 2 Wage costs (thousand EUR) 42,5 + 102,2 + 86,2 + 119,7 + 115,6 + 122,8 Assistance and reception Benchmark 2007 Change 2008/2007 Change 2009/2007 Change 2010/2007 Forecast Actual Forecast Actual Forecast Number of staff 1 — — — Full-time equivalent 0,3 + 0,3 + 0,3 + 0,5 + 0,5 + 0,5 Wage costs (thousand EUR) 11 + 20 + 14 + 30 + 20 + 30

(89) The same applies to the additional costs other than staff costs associated with Ryanair’s commercial activity: Safety Benchmark 2007 Change 2008/2007 Change 2009/2007 Change 2010/2007 Forecast Actual Forecast Actual Forecast (thousand EUR) 0 — — — — — Other costs 36,5 + 269,1 + 163,2 + 316,9 + 248,5 + 326 including vehicle leases (thousand EUR) 0 + 157,9 + 138,4 + 210,5 + 223,5 + 210,5 Security Benchmark 2007 Change 2008/2007 Change 2009/2007 Change 2010/2007 Forecast Actual Forecast Actual Forecast Services provided (thousand EUR) 0 + 118,6 + 112,6 + 253,2 + 113,5 + 263,2 Other costs (thousand EUR) 12,5 + 16,8 + 14 + 14,8 - 4,5 + 15,2 Assistance and reception Benchmark 2007 Change 2008/2007 Change 2009/2007 Change 2010/2007 Forecast Actual Forecast Actual Forecast Services provided (thousand EUR) 5 + 140 + 96 + 180 + 90 + 180 Other costs (thousand EUR) 5 + 20 + 10 + 25 + 12 + 25

5.2.2. Compatibility with the internal market

(90) The French authorities consider that some of the criteria in the 2005 Guidelines have not been complied with.

(91) First of all, they state that Ryanair did not submit a business plan. They had felt that the degressive aid resulting in the signing of the 2008 Agreements was such as to allow the airline to make a satisfactory commercial margin.

(92) Consequently, in the absence of a business plan, they emphasise that it is impossible to verify whether the aid intensity criterion is met. However, Angoulême CCI and SMAC, based on the information available on the creation of routes with public service obligations, did consider that this criterion was fulfilled.

(93) The French authorities further believe that the upward annual trend of […] (67) % in the number of passengers without an increase in rotations observed in 2008 and 2009 would likely have continued in 2010.

(94) Lastly, as set out in recitals 56 to 60 of this Decision, the French authorities are of the opinion that the measures adopted do not affect trade to an extent contrary to the common interest.

5.3. The new guidelines

(95) France formulated comments on the interpretation of the new guidelines, on the form and the substance, and expressed its agreement with their application to cases concerning measures implemented before they were published.

(96) They note that the new guidelines are more flexible than the old guidelines as regards operating aid. France maintains that their retroactive application to all aid would therefore allow previous situations for certain airports to be treated less disadvantageously.

6. COMMENTS BY THIRD PARTIES

6.1. Comments by Air France

(97) Air France considers that the measures granted in favour of Ryanair and its subsidiary AMS are particularly representative of Ryanair’s commercial practices.

(98) Air France has also submitted comments to the Commission on the application of the new guidelines to this case. It challenges the application of the new guidelines to cases relating to operating aid to airports, even where the aid was paid before the guidelines were published.

(99) First, Air France takes the view that this is a retroactive application of the new guidelines which benefits unscrupulous operators by legitimising behaviour which did not comply with the rules applicable to the period during which the behaviour occurred. Conversely, that approach penalises operators which complied with the previous guidelines by refraining from receiving public funds.

(100) Second, Air France emphasises that the retroactive application of the new guidelines to operating aid granted to airports is contrary to the general principles of law and to European case law.

6.2. Comments by Ryanair

(101) The airline Ryanair (‘Ryanair’) disputes the assertion that the Airport Services Agreement that it concluded with Angoulême airport constitutes State aid.

(102) It argues that its decision to launch a route from London Stansted to Angoulême reflected the wish to secure a low-cost base whose environment matched the characteristics of Angoulême airport. Moreover, the specific features of Angoulême airport were such as to incite it to offer a competitive schedule of airport charges. Despite the uncertainties linked to the opening of a new route (68), and as a result of the risk undertaken, Ryanair believes that the airport could reasonably expect to make a profit from the agreement concluded because of its success on other routes.

(103) Ryanair also points out that the decision to terminate the London Stansted-Angoulême route was taken for commercial reasons. It claims that the revenue shortfall had reached […] % in 2009 in relation to 2008 (69). It emphasises that it had negotiated in good faith, in application of Article 9 of the Airport Services Agreement, with a view to reaching a viable economic agreement with Angoulême airport. It states that it requested a reduction in airport charges in September 2009. After SMAC had refused the request on 3 February 2010, Ryanair states that it proposed to continue operating the route during July and August only, a proposal which SMAC rejected outright, resulting in the agreement being broken off.

6.2.1. State resources and imputability

6.2.1.1. Presence of state resources

(104) Ryanair points out that not all CCI resources are generated by taxes. It takes the view that Article R. 224-6 of the Civil Aviation Code requires airports managed by a CCI to finance their expenditure from revenue generated by airport operations. Ryanair considers that Angoulême CCI provided the bulk of airport financing. By contrast, SMAC did not have any experience in running an airport (70).

6.2.1.2. Imputability of the measures to the state

(105) Ryanair believes that the sole fact that Angoulême CCI is under the control of the state and that its resources are taxes is not sufficient to fulfil the criterion of imputability to the state.

(106) It states that the organisational criterion, i.e. the public nature of a body, is not enough in itself to establish the imputability of the measure to the state (71). In this case, a distinction should be made between the CCIs and other public bodies (72). In this regard, Ryanair notes that Article L. 711-1 of the Commercial Code in force in June 2005 classifies CCIs as public economic entities (établissements publics économiques) and that a parliamentary report identifies their ‘dual institutional nature’ and raises doubts about how to classify them (73). Ryanair also points out that the state is not involved in their decision-making processes, its role being limited to administrative supervision (74).

6.2.2. Selective advantage

6.2.2.1. Joint assessment of an economic benefit granted to Ryanair and AMS

(107) Ryanair considers that it and AMS should not be regarded as a single beneficiary of the measures in question.

(108) First, the beneficiary of the Marketing Services Agreement was the airport; the objective was not to increase the load factor or the yield on Ryanair’s route. Second, neither AMS’s shareholding structure nor its objects are grounds for disputing the fact that the agreements in question had separate objectives. Ryanair also stresses that the two agreements were signed by different people (75), despite the sole management highlighted by the Commission.

(109) Ryanair also notes that the conclusion of a marketing services agreement is not a precondition for opening a route. However, this practice is more frequent in the case of regional airports (76).

6.2.2.2. Joint assessment of the Airport Services Agreement and the Marketing Services Agreement

(110) Ryanair challenges the joint assessment of the Marketing Services Agreement and the Airport Services Agreement. It stresses that marketing services agreements are a matter for AMS, a Ryanair subsidiary. They are negotiated and concluded separately from Ryanair’s agreements with airports.

(111) However, Ryanair points out that the company itself carries out the advertising campaigns for its destinations. It also notes that it placed advertising on its website for the benefit of third parties without the involvement of AMS. Lastly, Ryanair believes that the Commission, in its Decision on Bratislava airport (77), acknowledged that there is value to the advertising campaigns carried out on the company’s website.

6.2.2.3. Principle of a prudent investor in a market economy

(a) Business plan

(112) Ryanair states that investment decisions are not systematically preceded by a business plan. The fact that Ryanair, other companies and certain competition authorities (78) do not regard business plans as systematically useful is sufficient to establish that it is not realistic to make them a factor characterising the behaviour of a market economy investor.

(b) Remarks on the conditions for applying the market economy investor principle (MEIP)

(113) Ryanair considers that the Commission cannot apply the market economy investor principle selectively. Referring to the position of the General Court (79), it stresses that the Commission must envisage the commercial transaction as a whole and examine all the relevant features of the measures and their context (80).

(114) Furthermore, Ryanair takes the view that the Commission must compare the agreements concluded between Ryanair and the public airports with those concluded with the airports partially or wholly owned by private investors. Ryanair refers to a study (81) for the purpose of this analysis. Recalling the case law of the Court of Justice (82), it states that it is only where no reference to a private investor is available that the Commission should adopt an approach based on costs.

(115) Ryanair considers that the Commission’s approach of only accepting comparator airports in the same catchment area as the airport under investigation is flawed (83).

(116) Ryanair argues that market benchmark prices obtained from comparator airports are not polluted by State aid given to surrounding airports. Therefore, it is possible to robustly estimate a market benchmark for the MEIP tests.

(117) In fact: — comparator analyses are widely used for MEIP tests outside the field of State aid, — companies affect each other’s pricing decisions only to the extent that their products are substitutes or complements, — airports in the same catchment area do not necessarily compete with each other, and the comparator airports used in the reports submitted face limited competition from state-owned airports within their catchment area. Less than one third of commercial airports within the catchment area of comparator airports are fully state-owned, and none of the airports within the same catchment area as comparator airports was subject to ongoing State aid concerns (as of April 2013), — even where comparator airports face competition from state-owned airports within the same catchment area, there are reasons to believe their behaviour is in line with the MEIP (for example, where there is a large private ownership stake or where the airport is privately managed), — market economy investor airports will not set prices below incremental cost.

(118) Ryanair states that the market economy investor principle must take account of the low economic value of regional airports ahead of the rapid development of their activity. With regard to the costs associated with their closure or maintenance in operation, Ryanair takes the view, recalling the case law of the General Court (84), that any less costly alternative should be considered to be consistent with the market economy investor principle.

(119) Ryanair therefore takes the view that the costs taken into account by the Commission should be the incremental costs rather than the average costs. Angoulême airport had an economically rational interest in pricing at marginal (or even lower) cost.

(120) First, the greater the competition faced by an airport, the greater its incentive to reduce its prices to marginal cost.

(121) Likewise, according to Ryanair, the Commission should take into account the specific nature of every airport (85). In this regard, it is of the opinion that the highly competitive environment between regional airports leads them to compete with a view to concluding agreements with it. In doing so, these airports are acting in the same way as private investors.

(122) The airport’s desire to improve its image leads it to carry out advertising campaigns. This effect is all the stronger where the market power of regional airports is limited and they have an interest in attracting airlines that are able to develop their traffic.

(123) Ryanair further states that the business plan applicable to those airports should imply that only a part of the fixed and infrastructure costs are deemed sunk costs. The time horizon of the business plan should be at least 15 years rather than a standard duration of 5 years.

(124) In this context, Ryanair argues that the approach adopted should be the ‘single-till’ approach. Relying on the Commission’s position in its decision on Bratislava airport (86), Ryanair considers that non-aeronautical revenues, which account for approximately 50 % of the revenue of an airport, are of particular importance to under-used regional airports. It is the wish to develop these revenues to cover as many fixed costs as possible that explains the penalties provided for in the agreements concluded with Ryanair if the latter did not fulfil its commitments. Ryanair’s activity increases the economic value of the airport, which is free to take advantage by attracting other airlines.

(125) According to Ryanair, the interest of regional airports in concluding an agreement with an airline such as itself is increased by the network effects associated with the opening of a route (87). Ryanair’s view is that the interest of Angoulême airport in concluding an agreement with it was all the greater because the only alternative would have been to open routes with public service obligations operated by airlines using small aircraft such as Twin Jet. However, Ryanair emphasises that this second option would have involved an opportunity cost for the airport, since large airlines generate a lower cost per passenger.

(126) Ryanair also takes the view that the Commission should take into account the network externalities generated by its activity. An agreement concluded with Ryanair acts as a ‘magnet’ for other airlines seeking increased visibility and better infrastructure. These network effects have a positive impact on aeronautical and non-aeronautical revenues (88). Ryanair believes that the Commission took this approach in the decision on Bratislava airport (89). Airports therefore have an interest in concluding an agreement with an airline giving traffic commitments.

(127) Ryanair points out that the agreements it concludes are not exclusive. Any other airline offering the same service as Ryanair could be granted identical operating conditions.

(128) With regard to the profitability analysis, Ryanair argues that the following principles would be adopted by a rational private sector investor (90): — the assessment is undertaken on an incremental basis, — an ex ante business plan is not necessarily required, — for an uncongested airport, the ‘single till’ approach is the appropriate pricing methodology, — only those revenues associated with the economic activity of the operating airport should be considered, — the entire duration of the agreement, including any extensions, should be considered, — future financial flows should be discounted in assessing the profitability of the agreements.

(129) Incremental profitability of Ryanair agreements to the airports should be assessed on the basis of estimates of the internal rate of return or net present value (NPV) measures.

(c) Application of the market economy investor principle

(130) In general, Ryanair considers that Angoulême CCI had acted as a genuine private investor because its status, independent of the State, in itself constitutes evidence of compliance with the market economy investor principle. The fact that the funding of the airport investments had been provided by the member of SMAC provided further evidence, since the owners of the airport had an interest in increasing its value.

(131) Ryanair emphasises that the assessment of the airport charges that it pays should be carried out against its reduced needs. Compared with other airlines, Ryanair argues that its business model requires fewer check-in desks, facilities and services, and the fact that it does not use stopovers reduces the duration and intensity of ground handling for its aircraft and increases the productivity of the crew in order to reduce reliance on airport services.

(132) It also considers that, for the purposes of applying the market economy investor principle, certain European airports are substitutable for Angoulême airport because of their similarities (91). In this regard, Ryanair submits a comparative study which concludes that the airport charges levied by […], […], […] and […] airports, which are comparable to Angoulême airport, are on average lower than the charges at Angoulême airport (92). Table 11 Airports comparable to Angoulême airport Airport characteristics compared Angoulême […] […] […] […] Population of the airport town 45 000 1 68 000 1 57 000 31 400 1 21 000 Distance to the town (kilometres) 14 12 45 46 11,5 Largest city within 150 km (population) Bordeaux (2 41 000) […] (4 41 000) […] (4 81 000) […] (76 000) […] (1 1 19 000) Closest large airport (passengers in 2009) Bordeaux (3 3 00 000) […] (1 8 00 000) […] (7 7 00 000) […] (2 8 00 000) […] (1 9 0 00 000)

(133) Ryanair also states that the choices made by Angoulême airport after it had closed the route to London Stansted were such as to establish that the airport considered that a scheduled commercial service to the United Kingdom operated by a low-cost carrier was a credible solution. In this connection, it refers to the agreement concluded with SNC-Lavalin, which had a mandate to introduce an aggressive development scenario.

(134) Moreover, Ryanair argues that a guaranteed level of passengers, such as the one it committed itself to, would limit the economic risk taken by an airport. As a result, the guarantee justifies a lower level of profitability than would be required by a private investor without the benefit of that clause.

(135) Ryanair also notes that the ‘single till’ approach (93) explains why an airport seeks to maximise its revenues by reducing the level of its airport charges. Ryanair therefore challenges the assessment that a negative price cannot be a market price. It believes that a negative airport charge may be consistent with the market economy investor principle if the expected level of non-aeronautical revenues is sufficiently high. In this case, Ryanair takes the view that a private investor could reasonably assume that the non-aeronautical revenues, which were zero, would develop as a result of the traffic that it could generate (94).

(136) It argues that this approach is bolstered by the specificity of the situation of Angoulême airport. It judges that a market economy investor should regard infrastructure costs and fixed operating costs as sunk costs. That is all the more so in this case since Angoulême airport was likely to suffer from competition with the TGV high-speed train (95). Moreover, Ryanair maintains that if the closure of the airport had been another option, the market value of the assets net of closure costs would not have been significant. These sunk costs should therefore be ignored.

(137) Furthermore, bearing in mind that Ryanair undertook to guarantee a minimum level of traffic, failing which it could face penalties, it considers that any commercial offer represents an improvement on the situation of an airport with the characteristics of Angoulême airport. The only condition is that its marginal revenues should be higher than its marginal costs, which would differentiate the situation of Angoulême airport from that analysed by the Court of Justice in the Chronopost judgment (96). Consequently, Ryanair states that, in this case, a private investor in a market economy would not necessarily seek a return on investment in the case of existing infrastructure. According to Ryanair, nor would such an investor require the contracting airline to participate in covering the operating costs incurred before the agreement was concluded.

(138) Lastly, Ryanair states that the decisions taken by Angoulême airport were not specifically addressed to it.

(139) Such is the case, first of all, with the decisions to adapt Angoulême airport. Most of these investments were carried out before it arrived. In the same way, it stresses that in many cases the recruitment contracts for members of staff were concluded or extended after it had left. Those decisions therefore formed part of the wider plan to position Angoulême airport in the low-cost carrier market (97). The decisions taken subsequently by SMAC once Ryanair had left, such as the choice of the scenario pursued by SNC-Lavalin, are evidence of this.

(140) Lastly, Ryanair emphasises that Article 3 of the Airport Services Agreement stipulated that the operating conditions granted to it could be granted to any other airline. It states that the level of airport charges was in any event published by Angoulême airport.

(d) Comments relating to the payments to AMS

(141) Ryanair disagrees with the Commission’s preliminary assessment of the payments to AMS as costs to the airport since this approach disregards the value of AMS’s services to the airport. Ryanair further believes that, for the purposes of the market economy operator analysis, the purchase of valuable marketing services at market rates should be considered separately from a related airport-airline contractual arrangement.

(142) In support, Ryanair submits an analysis of benchmarking prices charged by AMS against prices for comparable services offered by other travel websites (98). The analysis concludes that prices charged by AMS were either lower than the average or within the mid-range of prices charged by comparator websites.

(143) According to Ryanair, this shows that AMS’s prices are in line with market prices and the decision by a public airport to purchase AMS’s services is consistent with the market economy operator test. Ryanair further provides evidence of the services that are provided to the airports under AMS contracts, with the aim of showing the value of these services to the airports.

(144) According to Ryanair, should the Commission, despite its opposition to such an approach, insist on including AMS agreements and Ryanair’s airport services agreements in a single market economy operator test, the value of AMS services to the airport should not be disregarded.

(145) In addition, Ryanair refers to the conclusions of various reports confirming that it has a strong pan-European brand capable of attracting a premium for its advertising services.

(146) Ryanair also submitted a report prepared by Oxera, its economic adviser, concerning the principles that it believes should apply to a market-economy operator profitability test encompassing both the air services agreements concluded between Ryanair and airports and the marketing agreements concluded between AMS and the same airports (99). Ryanair emphasises that this does not prejudice its position that AMS agreements and air services agreements should be subject to separate market-economy operator tests.

(147) The report states that AMS-associated income should be included on the revenue side for the purposes of a joint profitability analysis, whereas AMS expenditure should be included on the cost side. In order to do so, the report proposes a cash-flow-based method by which expenditure on AMS would be treated as incremental operating expenditure.

(148) The report submits that marketing activities contribute to creating and enhancing brand value, which is likely to generate business and profits over the duration, but also beyond the expiry, of the marketing agreement. This would be the case where, because of an agreement with Ryanair, other airlines are attracted to the airport, in turn attracting commercial operators and increasing the airport’s non-aeronautical revenues. According to Ryanair, were the Commission to undertake a joint profitability analysis, these benefits should be taken into account by treating expenditure on AMS as incremental operating expenditure, with incremental profits calculated net of AMS payments.

(149) Ryanair considers in addition that a terminal value could be included in projected incremental profits at the end of the term of the air services agreement in order to capture the value accruing beyond the expiry of its term. The terminal value could be adjusted by a conservative assumption about the probability of whether the agreement will be renewed with Ryanair or whether similar conditions will be agreed with other airlines. Ryanair considers that this would allow an estimate of a lower bound for the benefits arising from the AMS and air services agreements jointly, taking into account the uncertainty of incremental profits beyond the expiry of the air services agreement.

(150) In support of this approach, the above report submits a summary of the results of studies on the effect of advertising on brand value. These studies recognise that advertising can build brand value and improve customer loyalty. In particular, according to the report, advertising on ryanair.com increases brand exposure for an airport. The report adds that smaller regional airports aiming to increase their traffic base can build their brand value by entering into advertising agreements with AMS.

(151) The report suggests that the cash-flow approach is to be preferred over a capitalisation approach under which AMS expenditure would be treated as capital expenditure on an intangible asset (i.e. the brand value of the airport). Marketing expenditure would be capitalised as an intangible asset and then amortised over its useful life, with a residual value at the end of the scheduled expiry of the air services agreement. This approach would, however, not capture additional benefits to the airport as a result of signing the air services agreement with Ryanair, and estimating intangible asset value due to brand expenditure and the length of the asset’s useful life is difficult.

6.3. Comments by AMS

(152) AMS disputes the assertion that the Marketing Services Agreement that it concluded with Angoulême airport constitutes State aid. The contract does not confer any selective advantage on it.

6.3.1. Joint assessment of an economic benefit granted to Ryanair and AMS

(153) AMS emphasises that it has genuine company objects, which consist in the provision of marketing services on the internet. It states that most of its activity is intended to increase the value of the advertising space on Ryanair’s website.

(154) Furthermore, it points out that Ryanair has chosen to work with other intermediate structures to market other advertising space.

(155) It follows that there are no grounds for taking the view that it is necessary to carry out a joint assessment of any economic benefit granted to Ryanair and AMS.

6.3.2. Joint assessment of the Airport Services Agreement and the Marketing Services Agreement

(156) AMS considers that the increase in the number of passengers using Ryanair services is not the only benefit accruing to Angoulême airport from the Marketing Services Agreement. First, it notes that the contract concluded by the airport with AMS is different from the one concluded with Ryanair. Second, it emphasises that Ryanair promotes its services using its own resources. Accordingly, Angoulême airport does not help to promote Ryanair services by concluding a marketing services contract with AMS.

(157) By way of illustration, AMS notes that Ryanair’s load factor is invariably […] % on average, regardless of whether or not a marketing services contract is concluded with it. Furthermore, AMS argues that the revenues accruing to Ryanair are identical for all passengers, either at arrival or departure from a particular airport.

(158) In general, AMS notes that advertising campaigns benefit the providers of the advertising space themselves (100). In this case, that externality is reflected in the increasing popularity of Ryanair’s website, regardless of whether the entity behind the advertising campaign is public or private. Since a private investor would not refrain from making an investment on the ground that third parties would benefit, AMS considers that Angoulême airport did not have to take into account the fact that Ryanair also benefited from its investment in advertising.

(159) AMS takes the view that in this case Ryanair played a pioneering role since most airlines now commercialise the space available on their website. However, it believes that Ryanair’s website was unusual in that it had an exceptional value (101). Accordingly, it was not comparable with the websites of other airlines.

6.3.3. Criterion of a prudent investor in a market economy

6.3.3.1. Existence of an advantage in favour of AMS

(160) AMS considers that it did not benefit from any economic advantage within the meaning of Article 107(1) TFEU. It states that its services are directed to both private and public entities. It could therefore have benefited from the same measure by a private company. It adds that it does not force airports to buy its marketing services (102) and that the advertising space which it markets is a scarce resource for which there is high demand.

6.3.3.2. The relationship between AMS services and the needs of its customers

(161) AMS considers that carrying out advertising campaigns is a necessity for regional airports. Their objective is to raise the profile of the services they offer. It adds that the major airport hubs themselves now feel that it is desirable to conduct advertising campaigns. The resulting image enhancement benefits the airports in question (103). In this connection, AMS states that this expenditure is a strategic investment comparable to those made by companies such as Coca-Cola, McDonald’s and Nike.

(162) This investment is all the more decisive because airports tend to generate almost half of their revenues from non-aeronautical activities. In this case, Angoulême airport had an even greater interest in generating traffic comprising international customers because regular passenger traffic was almost non-existent. On the contrary, AMS takes the view that Ryanair had no interest in contributing to these investments in advertising because it does not generate any additional revenue from inbound or outbound passengers.

(163) AMS states that the promotion of the ‘brand’ of airports, and in particular regional airports, has become common practice. In this connection, it refers to the desire to increase the value and profile of the airport so that it becomes a destination chosen by travellers, to the fact that these investments are economically rational for both public and private investors, to the fact that these investments are also carried out by hubs, to the fact that airports have an interest in increasing the number of outbound passengers, and to the fact that what differentiates regional airports from hubs is that the former do not enjoy the same international profile. This strategy is independent of the airline chosen by travellers, since airports define their marketing investments in relation to the ability of the advertising space to target their potential customers.

6.3.3.3. The price of services provided by AMS

(164) AMS states that its prices in relation to Angoulême airport are market prices. Comparing the contracts concluded with […] and […] airports, it maintains that it does not discriminate between airport and non-airport clients. Furthermore, it takes the view that making commercial use of the space available on Ryanair’s website (104) is also likely to establish that the price of the service provided to Angoulême airport is a market price.

(165) AMS argues that the Commission, in its decision on Bratislava airport cited in recital 111 of this Decision, took the view that it could not be excluded that a certain value could be attached to the mere presence of the name of an airport on Ryanair’s website, provided that the airport is mentioned as a destination.

(166) Furthermore, AMS notes that its rate card is objective and available on its website (105). The prices applied to the contract concluded with Angoulême airport are consistent with this framework. The prices have been set according to the type of page in question (106), the type of placement (107), the number of daily visitors and the number of routes to and from the airport.

(167) Lastly, AMS states that the services it provides are more effective — because they are more targeted — than those provided through other traditional advertising platforms, such as newspapers. This is all the more so since the advertising it provides on Ryanair’s website are ‘fixed’, whereas other websites rotate, and the prices laid down in the Marketing Services Agreement concluded with Angoulême airport were set using a 2007 price base, while traffic on Ryanair’s UK website rose by 55 % between 2008 and 2012.

6.4. Comments by Transport & Environment

(168) The comments by this non-governmental organisation under this procedure are limited to questioning the merits of the new aviation guidelines and of the decisions adopted by the Commission in the aviation sector, because of their environmental impact.

7. COMMENTS BY FRANCE ON THE COMMENTS BY INTERESTED PARTIES

(169) The French authorities have indicated that they have no additional comments to make in response to the comments by interested parties.

8. ASSESSMENT OF THE AID MEASURES IN FAVOUR OF THE SUCCESSIVE AIRPORT MANAGERS

8.1. Existence of aid within the meaning of Article 107(1) TFEU

(170) Under Article 107(1) TFEU, any aid granted by a Member State or through state resources in any form whatsoever which distorts or threatens to distort competition by favouring certain undertakings or the production of certain goods, in so far as it affects trade between Member States, is incompatible with the internal market.

(171) For a national measure to be classed as State aid the following cumulative criteria therefore have to be met: 1) the beneficiary or beneficiaries must be undertakings within the meaning of Article 107(1) TFEU; 2) the measure must be granted through state resources and be imputable to the state; 3) the measure must confer a selective advantage on its recipient(s); and 4) the measure must distort or threaten to distort competition and must be likely to affect trade between Member States.

8.1.1. Concepts of undertaking and economic activity

(172) In order to determine whether the subsidies described above constitute State aid, it must be ascertained whether the beneficiaries are undertakings within the meaning of Article 107(1) TFEU.

(173) The Commission would point out here that it is settled case-law that the concept of undertaking covers any entity engaged in an economic activity, regardless of its legal status and the way in which it is financed (108). Moreover, the concept of economic activity covers any activity consisting in offering goods and services in a given market (109).

(174) In its Leipzig-Halle airport judgment, the Court of Justice confirmed that the operation of an airport for commercial purposes and the construction of airport infrastructure constitute economic activities (110). An airport operator engaged in economic activities, irrespective of its legal status and the way in which it is financed, necessarily constitutes an undertaking within the meaning of Article 107(1) TFEU and therefore the Treaty rules on State aid apply (111).

(175) In the case at hand, the Commission would point out that the infrastructure in which investments financed by public subsidies were made, in particular the extension of the runway and work on the terminal, has been operated on a commercial basis by the successive airport operators. These operators have accordingly charged for the use of the infrastructure concerned.

(176) The financing of this airport infrastructure and the potential operating aid involved have therefore served primarily to finance the economic activity of the commercial operation of the airport engaged in by its successive operators. It follows that the entities operating the infrastructure constitute undertakings within the meaning of Article 107(1) TFEU.

8.1.1.1. Entities engaged in the economic activity of operating the airport

(177) The Commission would point out that CCI-airport performed the management and thus the commercial operation of Angoulême airport alone from 2002 to 2006.

(178) As regards the periods after 2006, the Commission would point out that two distinct legal entities may be considered to be engaged jointly in an economic activity for the purposes of applying the State aid rules where they in fact provide goods or services jointly on a given market. On the other hand, an entity that is not itself engaged in providing goods or services on a market cannot be regarded as an undertaking solely on the grounds of its holding a share, even a controlling share, where that share gives rise only to the exercise of the rights attached to the status of shareholder or member (112). The Commission takes the view that during the period 2007-2011 SMAC and CCI-airport were jointly engaged in the commercial operation of Angoulême airport. The commercial revenues from the supply of airport services were set and collected by CCI-airport, which was also responsible for the operational management of the airport. At the same time, SMAC had the authority to enter into commercial commitments with third parties on behalf of the airport. It also had operational and financial responsibility for investments of a commercial nature at the airport site. SMAC was directly involved in the supply of airport services, in particular through its involvement in the commercial management of the airport during this period, for example by concluding the 2008 agreements.

(179) Likewise, the Commission would point out that the transfer of the management of Angoulême airport to SNC-Lavalin as of 1 January 2012 did not release SMAC from its responsibilities. Under the contractual framework established by the public procurement procedure of 6 July 2011, certain obligations have remained the responsibility of SMAC during the period of the contract.

(180) First, SMAC is solely responsible for investment decisions. It finances the related expenditure (113) even though this expenditure is indissociable from the activity of operating the airport (114). Next, SMAC carries a significant share of the operating risk in so far as it guarantees, up to an annual ceiling, the equilibrium of the airport’s accounts (115). Lastly, SMAC has expressed the intention of directly financing support to airlines designed to implement the airport’s commercial policy of re-opening a route between Angoulême airport and the British Isles.

(181) The Commission therefore takes the view that, in the period starting on 1 January 2012, SMAC remains the joint operator of the airport.

(182) The Commission accordingly finds that the economic activity of the commercial operation of Angoulême airport has been successively carried on by the following three groups of entities: — CCI-airport for the period 2002-2006, — jointly by SMAC and CCI-airport for the period 2007-2011, and — jointly by SMAC and SNC-Lavalin as of 1 January 2012.

8.1.1.2. Exercise of public powers

(183) The Commission would point out that not all activities engaged in by an airport manager are necessarily economic in nature. Activities relating to the exercise of public powers are in principle not economic in nature.

(a) National system for financing state tasks in French airports

(184) Various tasks performed by the successive managers of Angoulême airport relating to air traffic safety, security or environmental protection were financed by the public authorities between 2002 and 2012. This funding falls within the scope of the present formal investigation procedure.

(185) In this connection, France has referred to the general system for financing state tasks in French airports laid down in national law and described below.

(186) This system is based on a tax, the airport tax, and an additional financing instrument. The background to and rules governing these instruments, and the tasks financed by them, are described below.

(187) In 1998 the Council of State ruled in its judgment in SCARA (116) that safety and security tasks in airports were sovereign responsibilities incumbent on the state and that they therefore could not be charged to airport users. Following this ruling, Law No 98-1171 of 18 December 1998 on the organisation of certain air transport services and Article 136 of Law No 98-1266 of 30 December 1998 (1999 Budget Law) (117) introduced the airport tax as of 1 July 1999. It is an earmarked tax in so far as the revenue from it can be used to finance certain expenditure only, namely the cost of tasks which France regards as sovereign responsibilities in airports. The above legal provisions also introduced an additional instrument to finance such tasks. The type of task financed by the airport tax and the additional financing instrument, and the rules governing the airport tax and the additional instrument, are set out below.

(188) French legislation, together with the more detailed regulatory provisions, sets out precisely which tasks can be financed by the airport tax. They are aircraft rescue and firefighting, wildlife hazard prevention (118), the screening of hold baggage, passengers and cabin baggage, control of public access points to the restricted area (119), environmental protection measures (120) and automatic border control using biometric identification. The reference to automatic border control using biometric identification was introduced into the legislation in 2008. Otherwise, the set of tasks eligible for financing by the airport tax has remained unchanged since it was introduced and corresponds to the tasks covered by the SCARA judgment. A number of national and European regulatory instruments set out the obligations incumbent on airport operators in relation to the performance of these tasks. For example, for aircraft rescue and firefighting, the regulations set out precisely the human and material resources to be put in place depending on the characteristics of the airport.

(189) For any given airport, the airport tax is payable by all airlines using the airport. It is based on the number of passengers and the mass of freight and mail carried by the airline. The rate of airport tax per passenger or tonne of freight or mail is set annually for each airport, depending on the estimated cost of performing the tasks financed by the tax.

(190) Each year airport operators draw up an annual statement of costs and traffic. These statements set out, for the previous year, the actual observed levels of traffic and the costs of performing the safety and security tasks (121), and the amounts collected by way of the airport tax and the additional instrument for financing these tasks. They also contain estimates of traffic, costs and revenue related to safety and security tasks for the current year and the next two years. The statements are checked by the administrative authorities, who can also carry out on-site inspections. The rate of the tax is then set on this basis by an interministerial order.

(191) As the tax rates are calculated on the basis of estimates of costs and traffic, an ex post adjustment mechanism has been put in place in order to ensure that the airport tax revenue, supplemented where appropriate by the revenue from the additional financing instrument described below, does not exceed the costs actually borne in the performance of the relevant tasks. The costs concerned include the operating and staff costs incurred in the performance of these tasks, depreciation for investments made in connection with these tasks, and the share of overheads related to these tasks (122). Operators must keep multiannual accounts of the revenue from the airport tax and the additional financing instrument, and of the costs incurred in the performance of the relevant tasks. As soon as a positive balance is observed, it is carried over into the cumulative accounts for the preceding years, which may result in a positive or a negative balance. This balance is taken into account for setting the tax rate for the following year. In addition, any positive balance carries financial charges payable by the operator.

(192) From the outset, the financing by way of the airport tax had to be supplemented by an additional financing instrument. This was because the costs of safety and security are not proportional to the volume of air traffic, unlike the airport tax revenue. It became clear that in airports with low traffic volumes, the airport tax rate would have had to be set at a high level judged to be difficult for users to accept if the safety and security costs were to be met. For these airports, provision was therefore made for setting the airport tax at a lower level than that required to cover costs and for using an additional financing instrument to finance the eligible tasks where required.

(193) A number of different additional instruments succeeded one another in this regard. To start with, the French authorities used a specific fund, the Intervention Fund for Airports and Air Transport (‘FIATA’), set up alongside the airport tax, also by Law No 98-1266 of 30 December 1998 as referred to above. It was the successor to the Air Transport Equalisation Fund (‘FPTA’), initially reserved for financing air connections designed to promote regional development and territorial planning. A portion of the civil aviation tax was paid into it. FIATA was used to finance the same tasks as those financed by FPTA, extended to include those covered by the airport tax in order to supplement the latter for small airports. In practice, FIATA’s functions were essentially divided into two separate ‘sections’: an airport section for the supplementary coverage of safety and security tasks in small airports and an air transport section for subsidising air connections to promote regional development and territorial planning. Decisions on paying out FIATA grants for the supplementary financing of safety and security tasks were taken after consulting a management committee of FIATA’s airport section.

(194) In 2005 FIATA was closed, and the corresponding financing was taken over directly by the state budget for two years on the same terms, in particular as regards the opinion of a management committee. As of 2008, the state replaced this instrument by an increase in the airport tax, involving setting a tax that is higher than necessary to cover safety and security tasks in certain airports. The resulting surplus is redistributed to smaller airports in order to supplement the airport tax revenue collected by them.

(195) As explained above, the annual statements by the airport operators, which are checked by the administrative authorities, indicate estimated and actual costs and revenue from both the airport tax and the additional instrument. Likewise, the annual accounts kept by the operators and used for calculating the balance of actual costs and revenue leading to a downwards adjustment of the tax and the imposition of financial charges on the operators if the balance is positive, show the revenue from both the airport tax and the supplementary instrument. The mechanism for declaring, checking and adjusting the financing designed to avoid the payment of public funds over and above the costs actually borne thus applies both to the airport tax and to the additional instrument.

(b) Evaluation of the general system for financing state tasks entrusted to French airports

(196) As pointed out by the Commission in the new guidelines, the Court of Justice has held that activities that normally fall under the responsibility of the state in the exercise of its official powers as a public authority are not of an economic nature and in general do not fall within the scope of the rules on State aid (123). Under the new guidelines (124), activities such as air traffic control, police, customs, firefighting, activities necessary to safeguard civil aviation against acts of unlawful interference and the investments relating to the infrastructure and equipment necessary to perform those activities are considered in general to be of a non-economic nature.

(197) In addition, the new guidelines stipulate that, for public funding of non-economic activities not to constitute State aid, it must be strictly limited to compensating for the costs to which they give rise and must not lead to undue discrimination between airports. With respect to the second condition, the guidelines state that, when it is normal under a given legal order that civil airports have to bear certain costs inherent in their operation, whereas other civil airports do not, the latter might be granted an advantage, regardless of whether or not those costs relate to an activity which in general is considered to be of a non-economic nature (125).

(198) The activities financed by the general system for financing state tasks in French airports as described in Section 8.1.1.2 relate to safeguarding civil aviation against acts of unlawful interference (126), police tasks (127), aircraft rescue and firefighting (128), air traffic safety (129) and the protection of the natural and human environment (130). These activities can legitimately be regarded as falling under the responsibility of the state in the exercise of its official powers as a public authority. The Commission therefore takes the view that France rightly regards these tasks as incumbent on the state and therefore as non-economic for the purposes of the State aid rules.

(199) It follows that France may also provide for public funding to compensate for the costs borne by airport managers in the performance of these tasks, in so far as such performance is imposed by national law on all airports indiscriminately and provided that the funding does not give rise to overcompensation or to discrimination between airports.

(200) First, it must be noted that the system described above applies to all civil airports in France, both as regards the scope of the tasks giving rise to compensation and as regards the financing instruments. The non-discrimination requirement is therefore met. While French legislation entrusts the performance of state tasks to airport managers, it lays the responsibility for financing these tasks on the State, not the airport managers. Thus the compensation from public funds for the costs of performing these tasks does not result in mitigating costs that should normally by borne by airport managers under the French legal system.

(201) Second, it is clear from the description in Section 8.1.1.2 that the system laid down in the French legislation is based on strict mechanisms for checking costs on a before and after basis, thus ensuring that airport managers receive by way of the airport tax and the additional instrument only the amounts strictly necessary to cover the costs.

(202) It follows that the financing received by French airport managers under this system, including at Angoulême airport, does not constitute State aid.

8.1.2. State resources and imputability to the state

8.1.2.1. Presence of state resources

(203) Under the legal framework established by the 2002 agreement and the 2009 subcontracting agreement, a number of local authorities and other public authorities awarded grants to the successive operators of the airport. These authorities were CG16, Comaga, CCBC, SMAC and Angoulême CCI.

(204) In order to ascertain whether the resources of Angoulême CCI constitute state resources, the Commission takes note of the fact that a public administrative body (établissement public à caractère administratif) constitutes an independent administrative entity subject to close supervision by the central administration of the French state (131). Moreover, Angoulême CCI’s general budget includes tax revenue collected from companies entered in the trade and companies register. The Commission therefore takes the view that Angoulême CCI’s resources are state resources.

(205) In addition, local authority resources constitute state resources for the purposes of applying Article 107(1) TFEU (132). The members of SMAC who gave a contractual undertaking to pay into SMAC’s accounts from their own resources are Chambers of Commerce and Industry, local authorities (133) or public bodies themselves made up of local authorities. The Commission therefore takes the view that SMAC’s resources constitute state resources.

8.1.2.2. Imputability of the measures to the state

(206) The Commission takes the view that the decisions by the public-law entities awarding the subsidies at issue are imputable to the state (134).

(207) Moreover, the Commission notes that SMAC is a public body which has no employees and is administratively part of the local authorities which it groups together directly or indirectly. In addition, its budgetary decisions, which are binding on its members, are taken by a joint committee made up of representatives of its members. Taking account of these factors, the Commission finds that the decisions taken by SMAC relating to the activity of the airport are imputable to the State.

(208) As regards the measures taken by Angoulême CCI, the Commission would start by pointing out that Chambers of Commerce and Industry are public administrative bodies and as such are subject to public law. The Commission would also stress that French law classes Chambers of Commerce and Industry as ‘corps intermédiaires de l’État’ (intermediary bodies of the State) and confers on them the task of contributing to economic development, the attractiveness and land planning of the territory and support for businesses and business associations (135). The task of airport operation entrusted to the Chambers of Commerce and Industry also derives from their role of supporting local and regional development, even though the activity of operating an airport is in itself an economic activity (136).

(209) The Commission would also point out that Articles R712-2 et seq. of the Commercial Code place the Chambers of Commerce and Industry under the supervision of the representatives of the State. In this capacity, the authority exercising supervision has access to all CCI General Assemblies and can have items added to the agenda. In particular, decisions relating to initial, amending or implemented budgets are binding only once they have been approved, even tacitly, by the authority exercising supervision. In the case at hand, these budgets included financial transfers to the airport operators, including CCI-airport (137), as set out in recitals 28 and 29 of this Decision (138).

(210) The Commission accordingly takes the view that Angoulême CCI, including CCI-airport, forms part of the public administration (139) and that the measures adopted by it in favour of the operators of Angoulême airport are necessarily imputable to the State.

8.1.3. Selective advantage for the airport operators

(211) To determine whether a state measure constitutes aid to an undertaking, it must be determined whether the company in question enjoys an economic advantage enabling it to avoid costs that would otherwise have been borne by its own financial resources or whether it enjoys an advantage which it would not have received under normal market conditions (140).

(212) In the case at hand, the French authorities take the view that Angoulême airport in its entirety can be classed as an SGEI on account of its role in territorial planning and the economic and social development of the region. The financing granted to it does not therefore constitute State aid within the meaning of the Altmark ruling, because it does not confer on it a real advantage.

(213) As the French authorities argue that the financial contributions made to the managers of Angoulême airport do not entail a selective advantage under the terms of the Altmark ruling, the Commission must examine whether the conditions laid down in that ruling are satisfied in this case. In this regard, it should be recalled that the Court ruled in that case that the compensation granted in discharging public service obligations does not constitute aid within the meaning of Article 107(1) TFEU when the following four criteria are all met: — the recipient undertaking must actually have public service obligations to discharge, and the obligations must be clearly defined (first condition), — the parameters on the basis of which the compensation is calculated must be established in advance in an objective and transparent manner (second condition), — the compensation canno