Commission Decision (EU) 2023/105 of 26 July 2022 on the measures SA.33960 2012/C (ex 2012/NN) implemented by the French Republic in favour of the successive managers of Beauvais-Tillé airport and the airlines operating there (notified under document C(2022) 5076) (Only the French text is authentic) (Text with EEA relevance)
Date: 2022-07-26
Institutions: Directorate-General for Competition, European Commission
Subjects: France, Hauts-de-France, State aid, airport, civil aviation, control of State aid, infringement procedure (EU), investment aid, low cost airline, provision of services




L_2023012EN.01002801.xml










13.1.2023   


EN


Official Journal of the European Union


L 12/28








            COMMISSION DECISION (EU) 2023/105
of 26 July 2022
         
on the measures SA.33960 2012/C (ex 2012/NN) implemented by the French Republic in favour of the successive managers of Beauvais-Tillé airport and the airlines operating there


(notified under document C(2022) 5076)


(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,


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 (1), and having regard to their comments,

Whereas:
1.   PROCEDURE







(1)


By letter dated 27 November 2009, the Commission received a complaint about advantages which the airline Ryanair was allegedly enjoying at a number of local and regional French airports. In respect of Beauvais-Tillé airport (‘Beauvais airport’), the complaint also mentioned financial support allegedly received by the successive managers of the airport, namely the Chambre de commerce et d'industrie d’Oise (Oise Chamber of Commerce and Industry, ‘Oise CCI’) and the Société Aéroportuaire de Gestion et d'Exploitation de Beauvais (Beauvais airport managing and operating company ‘SAGEB’). The complaint drew in particular on a report by the Chambre régionale des comptes de Picardie (Picardie regional court of auditors, ‘CRC’) dated 3 September 2007 (2).










(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 alleged measures (‘the measures’). The French authorities initially responded by letters dated 31 May and 7 June 2010, and provided additional information by letter of 2 November 2011. The Commission forwarded these comments to the complainant and asked France for additional information by letter dated 5 December 2011. The French authorities sent their comments and their replies by letter dated 31 January 2012.










(3)


By letter dated 30 May 2012, the Commission notified France of its decision (‘the opening decision’) to initiate the formal investigation procedure laid down in Article 108(2) of the Treaty on the Functioning of the European Union (TFEU) in respect of, first, the aid potentially disbursed in succession to Oise CCI and SAGEB between 2000 and 2008 and, second, the aid potentially paid by Oise CCI and SAGEB to various airlines between 1 January 1997 and 30 May 2012.










(4)


The opening decision was published in the Official Journal of the European Union (3). The Commission invited interested parties to submit their comments on the measures in question.










(5)


By letter of 14 August 2012, the Commission received comments from France. On 25 October 2012, it then received comments submitted jointly by the Beauvais airport joint authority (Syndicat mixte de l'aéroport de Beauvais, ‘SMABT’), Oise CCI and SAGEB. The airlines Ryanair and Wizz Air sent their comments to the Commission on 26 October 2012. By letter of 21 December 2012, France stated that it did not wish to submit any response to these comments.










(6)


In addition, by letters of 10 April 2013, 20 December 2013, 9 and 31 January 2014, 7 February 2014, 28 March 2014, 27 January 2015, 7 December 2015 and 1 April 2019, Ryanair submitted a set of general comments, all relating to several State aid cases initiated by the Commission and involving Ryanair. It also submitted economic analysis reports by the consultancy firm Oxera on 12 and 26 September 2014 and 6 November 2014.










(7)


Wizz Air also submitted comments on 21 March 2014, and likewise submitted economic analysis reports by Oxera on Beauvais airport on 4 November 2014.










(8)


The Commission forwarded the comments by interested parties to France and gave it the opportunity to respond (4). France answered by letters dated 13 July 2012, 21 December 2012, 7 June 2013, 29 January 2014, 23 May 2014, 18 December 2015 and 24 June 2019. It its letter of 13 July 2012, France informed the Commission that it had no observations to make in respect of the comments submitted, notwithstanding the remarks it had already sent in connection with the Marseille Provence airport case (5). In addition, by letters of 25 July 2012, 29 January 2014, 23 May 2014 and 18 December 2015, France informed the Commission that it did not wish to submit any observations on the comments by third parties.










(9)


By letter of 24 February 2014, the Commission informed France and the interested parties that had already submitted comments of its intention to assess the compatibility of the measures with the internal market under the Guidelines on State aid to airports and airlines (‘the 2014 Guidelines’) (6). The Commission invited the recipients of these letters to comment in this connection, if they so wished. In addition, on 15 April 2014 a notice was published in the Official Journal of the European Union (7) inviting France and interested third parties to submit their comments in this connection.










(10)


France submitted its comments on the 2014 Guidelines on 19 March 2014. SMABT, SAGEB and Oise CCI sent joint comments to the Commission on 14 March 2014. Wizz Air submitted its comments on 21 March 2014, Air France on 25 April 2014 and the NGO Transport & Environnement by letter of 13 May 2014. The various comments submitted were forwarded to France by letter of 28 May 2014. France chose not to submit any response.










(11)


By letters dated 16 April 2014 and 16 July 2014, the Commission asked France for additional information. France replied on 19 June 2014 and 18 August 2014 respectively.




2.   BACKGROUND TO THE AID

2.1.   Characteristics of Beauvais airport







(12)


Beauvais airport is a French civilian airport located in the municipality of Tillé in the Department of Oise, 3 km north of Beauvais and around 90 km from Paris. The airport is open to domestic and international commercial traffic. Beauvais airport is 68 km from Amiens-Glisy airport, 80 km from Roissy-Charles de Gaulle, about 90 km from Rouen airport and 106 km from Orly South.










(13)


As of 1 May 1997, Ryanair started operating several routes from Beauvais airport to European destinations. From 2002, a number of airlines (Goodjet, Volare, Air Horizons, Sterling, etc.) gradually started offering scheduled services out of Beauvais airport. Despite the increase in traffic and the arrival of new airlines, Ryanair remained the biggest airline at the airport: its traffic accounted for over 80 % on average of all business at the airport in terms of passenger numbers between 1997 and 2011. Low-cost traffic accounted for almost all the airport’s business in 2011.










(14)


Passenger traffic at the airport between 1997 and 2011 is summarised in Table 1.

Table 1


Passenger traffic at Beauvais airport (passengers) 1997-2011
 (8)










 



Passengers





Ryanair share






Blue Air share






Wizz Air share







1997



207 000 


127 453  (62  %)


 


 





1998



260 000 


194 211  (75  %)


 


 





1999



387 000 


315 771  (81,5  %)


 


 





2000



387 229 


346 551  (89  %)


 


 





2001



422 972 


371 376  (87  %)


 


 





2002



677 857 


459 572  (68  %)


 


 





2003



969 445 


806 383  (83  %)


 


 





2004



1 427 595 


1 292 368  (91  %)


 


40 919 





2005



1 848 484 


1 528 405  (83  %)


4 023 


162 465 





2006



1 887 971 


1 626 279  (86  %)


28 947 


148 861 





2007



2 155 633 


1 907 662  (88,5  %)


69 795 


138 256 





2008



2 484 635 


2 212 165  (89  %)


81 072 


178 340 





2009



2 591 864 


2 210 078  (85  %)


79 414 


300 088 





2010



2 931 796 


2 465 476  (84  %)


84 660 


377 812 





2011



3 677 794 


3 185 327  (87  %)


90 083 


401 370 








2.2.   Operators of Beauvais airport

2.2.1.   Management of the airport by Oise CCI (1960 - 31.5.2008)







(15)


Until 31 December 1992, Oise CCI managed Beauvais airport on the basis of a 30-year public equipment concession (concession d’outillage public) signed in 1960 with the State, which owned the airport at the time. Oise CCI then managed the airport under a temporary authorisation to occupy the public domain (autorisation temporaire d’occupation du domaine public, ‘AOT’) granted by prefectoral order of 1 October 1997. This provided the legal basis for the management of the airport from 1 January 1993 to 31 December 1999. It was renewed several times up to 3 May 2002.










(16)


By concession agreement concluded on 30 January 2002, which entered into force on 4 May 2002, the State granted the concession for the construction, maintenance and operation of Beauvais airport to Oise CCI for a duration of 5 years.










(17)


By agreement of 1 March 2007, the State transferred the ownership and the powers to develop, maintain and manage Beauvais airport to SMABT, with effect from 1 March 2008.










(18)


SMABT, set up by prefectoral order of 20 October 2006, brings together the Region of Picardie (38 % of SMABT’s funding), the Department of Oise (38 %) and the Beauvaisis intermunicipal authority (communauté de communes du Beauvaisis, ‘CCB’, 24 %). SMABT operates by pooling the services previously provided separately by its members and to this end a service provision agreement was concluded with the Department of Oise so that members of its staff could be seconded to SMABT. SMABT is subject to State oversight of its budget (9) and of the legality of its decisions in accordance with the Local Government Code (Code général des collectivités territoriales, CGCT) in force when it was set up, and specifically Articles L. 1612-1 to L. 1612-20 and L. 3132-1 to L. 3132-4 thereof.










(19)


By decision of 7 June 2007, SMABT agreed in principle to delegate the public service of operating Beauvais airport and the bus service between Beauvais airport and Paris, and authorised the Chair of SMABT to launch a call for tenders. The following tasks were to be entrusted to the successful tenderer:






—


upkeep, maintain and operate Beauvais airport;










—


carry out certain works under a multi-annual investment plan, including in particular investments in maintaining installations and building commercial infrastructure (specifically building a second terminal);










—


operate bus services connecting the airport to Paris and other locations in the Île-de-France region.














(20)


Pending the conclusion of the award procedure referred to in recital 19, the concession agreement of 30 January 2002 with Oise CCI was renewed by the State until 1 March 2008 (10). By amendment to the agreement of 29 February 2008, SMABT, on behalf of the State, extended it again to 31 May 2008.










(21)


The operation of Beauvais airport by Oise CCI was booked separately from the activities carried out by Oise CCI’s general arm. In addition, the accounts for Beauvais airport’s commercial activities were kept separately from those for its activities falling under the remit of the State for the purposes of calculating the airport tax levied by the French Civil Aviation Authority (direction générale de l’aviation civile) to finance airport infrastructure and equipment connected with tasks incumbent on the State. Oise CCI’s main accounting and commercial data relating to the management of the airport from 1997-2008 are summarised in Table 2:

Table 2


Main accounting data for Oise CCI’s airport arm (000 €)
 (11)












 



1997




1998




1999




2000




2001




2002





Bus revenue


459 


657 


1 295 


1 403 


1 749 


3 546 




 


 


 


 


 


 


 




Ryanair revenue


n/a


n/a


n/a


n/a


706 


848 




Total revenue


2 566 


2 892 


4 153 


4 199 


5 264 


13 109 




 


 


 


 


 


 


 




Payments to Ryanair


n/a


n/a


n/a


n/a


462 


534 




Total expenditure


2 417 


3 413 


3 631 


4 675 


5 704 


13 069 




 


 


 


 


 


 


 




Net income


149 


- 521 


522 


- 475 


- 440 


40 




Net fixed assets


2 679 


3 146 


27 126 


2 595 


2 550 


2 887 




Balance sheet total


3 121 


3 933 


3 301 


3 411 


3 808 


8 163 




 



2003 




2004 




2005 




2006 




2007 




2008 
 (12)





Bus revenue


5 341 


8 007 


12 840 


11 845 


12 936 


5 858 




Ryanair revenue


1 502 


2 379 


2 777 


2 904 


3 425 


1 643 




Total revenue


16 915 


18 934 


26 982 


30 525 


33 264 


17 933 




 


 


 


 


 


 


 




Payments to Ryanair


834 


1 146 


1 272 


1 348 


1 558 


765 




Bus expenditure


 


 


6 078 


6 210 


6 403 


2 821 




Total expenditure


13 874 


22 414 


26 179 


28 731 


29 928 


17 950 




 


 


 


 


 


 


 




Net income


3 042 


-3 480 


803 


1 794 


3 335 


-17 




Net fixed assets


5 198 


8 017 


10 833 


14 448 


15 425 


150 




Balance sheet total


9 353 


15 283 


18 234 


31 585 


33 560 


16 374 








2.2.2.   Management of the airport by SAGEB (since 1.6.2008)







(22)


Following the award procedure referred to in recital 19, SMABT delegated (13) the operation of Beauvais airport to the Oise CCI-Veolia Transport consortium under a public service delegation agreement (‘the PSD agreement’) signed on 19 March 2008 (with effect from 1 June 2008) for a period of 15 years (14). Under the terms of the PSD agreement, as soon as it was set up, SAGEB automatically replaced the Oise CCI-Veolia Transport consortium as the entity to which the public service was delegated. The PSD agreement is still in force as at the date of adoption of this Decision.










(23)


SAGEB is a simplified joint stock company (société par actions simplifiée, SAS) whose capital was originally held by Oise CCI (51 %) and Veolia Transport (49 %), the latter in turn held by the majority privately owned group Veolia Environnement (15). In March 2011, Veolia Transport was replaced by Veolia-Transdev (50 % owned by the Veolia Environnement group and 50 % by Caisse des Dépôts et Consignations), which took over all the shares held by Veolia Transport in SAGEB. SAGEB’s internal operation and organisation are described in recitals 291 et seq.










(24)


Table 3 contains an overview of the successive contracts for the operation of Beauvais airport.

Table 3


Operation of Beauvais airport – Overview










Owner


Period


Operator


Type of contract


Date of contract




State


1.1.1993-4.5.2002


CCI Oise


AOT


Prefectoral order of 1.10.1997




4.5.2002-29.2.2008


CCI Oise


Concession agreement


30.1.2002




SMABT


1.3.2008-1.6.2008


CCI Oise




1.6.2008-31.5.2023


SAGEB


PSD agreement


19.3.2008








3.   DETAILED DESCRIPTION OF THE MEASURES







(25)


The measures comprise, first, financial support granted by the local authorities to the successive managers of Beauvais airport and, second, financial support granted by the successive managers of Beauvais airport to a number of airlines.




3.1.   Financial support to Beauvais airport







(26)


There are two types of support granted to Beauvais airport: funding for investment in airport infrastructure and contributions paid for the operation of the airport.




3.1.1.   Contractual framework for the grants made to Beauvais airport

3.1.1.1.   The temporary authorisation to occupy the public domain (1.1.1993-3.5.2002)







(27)


Under this authorisation, Oise CCI was entrusted, at its own risk, with installing, maintaining, renovating, operating and developing the works, land, buildings, installations, equipment and services needed for the operation of Beauvais airport (16). However, the State remained responsible for certain services connected with aviation safety, security and regularity (17), while Oise CCI provided fire-fighting and rescue services, bird hazard prevention and the aeronautical information service (18).










(28)


Oise CCI derived its income in principle from airport charges and operating income (19). Financial support could also be granted to cover expenses arising from the task of installing and maintaining infrastructure with which Oise CCI had also been entrusted (20). For this expenditure, Oise CCI could also request funding from other public authorities under Article 3 of the AOT. In exchange, Oise CCI was required to pay the State a fee for occupying the public domain, which was set at FRF 1 000 per year.




3.1.1.2.   The Beauvais airport concession agreement (4.5.2002-31.5.2008)







(29)


The concession agreement of 4 May 2002, some of the clauses of which referred to the application of the standard specification set out in the Decree of 29 May 1997 (21), divided tasks between the State and Oise CCI. As the authority awarding the concession, the State performed and funded all air traffic services (22). Besides the commercial operation of the airport (23), Oise CCI was responsible for performing and funding itself certain safety and security-related services, such as fire-fighting and rescue, bird hazard prevention, and security checks on passengers, hold baggage and access to restricted areas of the aerodrome (24).










(30)


Oise CCI derived its income in principle from the airport charges set by the concession agreement and from operating income (25). The safety and security-related services provided by Oise CCI as described in recital 29 were funded from the revenue from the airport tax and, if needed, by subsidies from the State (26).




3.1.1.3.   The public service delegation agreement (1 June 2008-2023)







(31)


The PSD agreement entrusts to SAGEB as its primary task the management and operation of Beauvais airport and, as its secondary task, the provision of bus links between Beauvais airport and Paris, both at the delegation holder’s own risk (27).










(32)


Under the PSD agreement, SAGEB is financially responsible for the performance of all activities relating to the operation of Beauvais airport, except for the safety of air navigation and meteorological services (28). In addition, SAGEB is responsible for certain safety and security-related services (29), in exchange for a financial contribution from the State set either by the legislation in force (30) or in accordance with the type and volume of traffic at the aerodrome (31).










(33)


As for the financial terms of the PSD agreement, SAGEB collects the revenue from aeronautical charges and other operating income from the airport and the operation of the Paris-Beauvais bus link. Conversely, SAGEB has to pay a fee for occupying the public domain to SMABT, which comes to around EUR 10,8 million over the duration of the agreement. Moreover, Annex 14 to the agreement provides, ‘in exchange for SMABT’s contribution to the funding of airport infrastructure, the concession holder undertakes to pay SMABT a share in profits calculated on the basis of any profit surplus compared with the estimated internal rate of return of 10 %’. The right to profit-sharing is triggered in year (n) if net income is positive, if the cumulative net income of years (1) to (n) is positive and if the resulting internal rate of return is higher than 10 %. The share in profits is set at 50 % of the excess profit.










(34)


Furthermore, the PSD agreement requires SAGEB to make a series of investments during its validity (32), estimated at EUR 68,2 million, which SAGEB is obliged to finance by any means and for which SMABT will make a maximum contribution of EUR 14,5 million (33) (see recital 41)




3.1.2.   The investment grants







(35)


Investment grants were paid to the successive managers of Beauvais airport under three investment programmes implemented in the periods 2001-2006, 2007-2008, and 2008-2023.




3.1.2.1.   The 2001-2006 investment programme (‘programme 1’)







(36)


In 2001, Oise CCI applied for a financial contribution from the Department of Oise, the Region of Picardie and the Beauvaisis intermunicipal authority. In its application, Oise CCI outlined a programme to modernise and upgrade Beauvais airport at an estimated cost of FRF 53,3 million (EUR 6,825 million).










(37)


The Department of Oise (34), the Region of Picardie (35) and the Beauvaisis intermunicipal authority (36) granted the application and awarded a total of EUR 4 311 395 (37) to Oise CCI, the rest of the costs being borne by the latter (EUR 2,55 million) (38). The grant was calculated not in relation to the specific costs set out in programme 1, but in relation to the overall cost estimate for the programme. The specific date for the start of the investments was set as 2 July 2001, and the investments had to be completed by 31 December 2006. This initial investment programme had to be modified during 2005 to take account, following a rise in passenger numbers, of regulatory constraints linked to the processing and safety of passengers (39). The investments planned and implemented under this programme can be summarised as follows:

Table 4


Investments planned and implemented under programme 1 (EUR)









Type of investment


Estimated amounts


Revised estimates (2005)


Final amounts of investment




West concourse (departures):






 


Baggage security hall










 


Baggage sorting hall










 


Airport offices










 


Canopy roof






1 687 153 


2 600 000 


2 608 000 




East concourse (arrivals)






 


Baggage handling hall










 


Passenger walkway






228 674 


160 000 


164 000 





Terminal modernisation



762 250 


600 000 


649 000 




Safety and security equipment:






 


Fire station construction










 


Security fencing










 


Airport security gates










 


Hold baggage screening equipment






914 690 


900 000 


922 000 




Access roads and utility services






 


Car park










 


Fire station (access roads and services)










 


Upgrading existing access roads










 


Waste water connection






762 245 


873 480 


1 238 000 
463 467 





Miscellaneous works



304 900 


0 


0 





Environmental studies and works



533 570 


60 000 


62 000 





Fees



623 210 


623 210 


744 000 





Modernisation of operating equipment:

Screening check points


1 048 310 


1 048 310 









1 264 000 












133 000 










TOTAL




6 865 000 




6 865 000 




7 650 000 















(38)


Despite higher than expected final costs, the local authorities referred to in recital 37 paid their contributions totalling EUR 4,311 million to Oise CCI as laid down in the funding agreements, the excess costs being borne by Oise CCI.




3.1.2.2.   The 2006-2007 investment programme (‘programme 2’)







(39)


Oise CCI carried out a second investment programme of EUR 9,5 million over a period of 2 years from 1 January 2006 to 31 December 2007. The Department of Oise, the Region of Picardie and the Beauvaisis intermunicipal authority agreed to make a financial contribution to this programme (calculated in relation to the overall cost estimate for programme 2, not in relation to specific costs), by agreements signed with Oise CCI on 11 December 2006, 11 July 2007 and 12 July 2007 respectively. The investment programme was as follows:

Table 5


Investments planned and implemented under programme 2 (EUR)








Type of investment


Estimated amounts of investment


Final amounts of investment




Terminal extension


1 202 039 


1 327 749 




Security fencing


151 653 


165 805 




Upgrading of aircraft stands and taxiway


1 410 000 


1 408 739 




Renovation of hangars and runways


300 000 


231 542 




Passenger flow separation corridor


237 451 


176 590 




Staff car park complying with the Water Act


215 079 


227 611 




Car rental base


110 000 


1 735 




Land acquisitions ILS


150 000 


61 540 




Indoor and outdoor signage


50 000 


10 510 




Porte Maillot passenger reception area


189 873 


213 548 




Compliance with the Water Act


870 000 


46 141 




Upgrading ground marking


75 000 


0 




ILS studies


150 000 


139 803 




Modernisation of public access roads


1 350 000 


1 053 861 




Administrative offices


890 000 


944 557 




Heating upgrade


80 000 


0 




Terminal 2 studies


0 


188 188 




Fees and contingencies


500 000 


745 123 




Modernisation of operating equipment:






 



Installation of border police booths











 



Installation of a laser bird repellent







1 568 905 


2 178 477 
52 670 
86 085 





TOTAL




9 500 000 




9 121 527 















(40)


The local authorities referred to in recital 37 undertook to contribute 74 % of the total investment amount, the rest being borne by Oise CCI, with the Region of Picardie and the Department of Oise contributing 25 % of the investment costs each (EUR 4,6 million in total) and the Beauvaisis intermunicipal authority 24 %, with a final grant of EUR 2,2 million to Oise CCI. Oise CCI thus received for this investment programme an investment grant of around EUR 6,8 million, corresponding to 74 % of the value of the investments carried out.




3.1.2.3.   The 2008-2023 investment programme (‘programme 3’)







(41)


As stated in recital 34, the PSD agreement requires SAGEB to carry out a programme of investments of EUR 68,2 million over the period 2008-2023, with funding from SMABT capped at EUR 14,5 million. Annex 6 to the PSD agreement set out the type and amount of these investments and the timetable for implementing them (40). The investments planned and implemented to date can be summarised as follows:

Table 6


Investments planned and implemented under programme 3 (EUR million)









Type of investment


Initial estimated amounts


Amounts executed at 31 December 2018


Revised estimates to be executed




Construction Terminal T2


11,9 


9,7 


0,01 




Upgrade Terminal T1


1,6 


5 


0,07 




Establishment of ILS category III programme


13,6 


14,4 


0 




Additional aeronautical infrastructure


3,3 


4,2 


0,2 




Parking and commercial facilities


5,4 


9,1 


0,03 




Environmental investment


2,9 


1,6 


0 




Installation maintenance


8,5 


3,3 


0,12 




Transfer of general aviation installations


0,7 


1,5 


0,04 




Acquisition of safety and security equipment


10,2 


8,7 


2,1 




Ground handling equipment and furniture


7,1 


1,8 


0,9 




IT equipment


3 


2,6 


1,8 





TOTAL




68,2 




61,9 




67,2 















(42)


As at 31 December 2018, investments worth close on EUR 62 million had been made by SAGEB. The investment forecasts from now until the expiry of the PSD agreement include a total estimated amount slightly below that originally included in the PSD agreement.




3.1.3.   Operating subsidies

3.1.3.1.   Direct payments







(43)


The Commission made the preliminary observation that none of the concession agreements for the management and operation of Beauvais airport provided for the payment of operating subsidies to the successive airport managers (see section 3.1.1).










(44)


None the less, the Commission pointed out in the opening decision that the successive managers had received various types of operating subsidy.










(45)


First, the Commission found that between 2002 and 2008, the accounts of Oise CCI (airport arm) showed various operating subsidies paid by a number of bodies to Oise CCI’s airport arm totalling EUR 107 924,59.

Table 7


Amount received in operating subsidies by Oise CCI’s airport arm (EUR)













2002


2003


2004


2005


2006


2007


2008


TOTAL




84 845,10 


15 245 


0 


7 834,49 


0 


0 


0 



107 924,59 









3.1.3.2.   Cash advances







(46)


Second, the French authorities had informed the Commission that Oise CCI’s general arm had paid zero-rate cash advances to the airport arm between 1995 and 2004 to deal with a risk of default linked to the numerous and urgent costs faced by the airport arm on account of the outdated infrastructure and considerable annual rise in traffic recorded in this period. Table 8 shows the amount of aid:

Table 8


Cash advances made by Oise CCI’s general arm to the airport arm (EUR)








Year


Cash advance made for the year concerned


Cumulative amount




1995


n/a


2 412 922,70 




1996


888 508,49 


3 301 431,19 




1997


- 394 036,04 


2 907 395,15 




1998


323 559,53 


3 230 954,68 




1999


- 838 477,75 


2 392 476,93 




2000


- 176 603,94 


2 215 872,99 




2001


73 514,73 


2 289 387,72 




2002


142 970,85 


2 432 358,57 




2003


-2 198 307,33 


234 051,24 




2004


327 698,17 


561 749,41 




2005


- 561 749,41 


0 








3.1.3.3.   Partial exemption from funding the tourism development plan







(47)


Lastly, the Commission found that the PSD agreement included in Annex 19 a tourism development plan for Beauvais airport (41). According to this Annex, the plan set a target of turning 8 % of passengers into consumers/visitors for Beauvais, Oise and Picardie within 3 years of the entry into force of the PSD agreement. To achieve this target, the plan set out a number of actions to encourage Beauvais airport passengers to stay in the Beauvaisis area, the Oise department or the Picardie region (passenger surveys, image marketing, etc.) The plan was to be carried out by the Picardie regional tourism committee, the Oise department tourism committee and the Beauvaisis tourist office (‘the institutional tourism agencies’). The plan was to be funded by SMABT and the selected tenderer, namely SAGEB (50 % each).










(48)


An agreement on objectives and means (convention d’objectifs et de moyens) was concluded on 15 October 2008 between SMABT, SAGEB and the institutional tourism agencies. It set out in detail the implementation of the tourism development plan contained in Annex 19 to the PSD agreement by the institutional tourism agencies. The agreement provided that the latter had to report on their activity directly to SMABT every year (as well as to the steering committee made up of all the signatories) (42). The agreement was concluded for a duration of 3 years with an annual budget of EUR 462 000 split 50-50 between SAGEB and SMABT and granted to allow them to implement the tourism actions agreed on.




3.2.   Measures in favour of the airlines







(49)


Between 1 May 1997 and 30 May 2012, various airport services contracts were concluded between the successive operators of Beauvais airport (first Oise CCI, then SAGEB) and a number of airlines.










(50)


The contractual relationship between the airport operator and Ryanair took the form of an exchange of letters, while with the other airlines a formal contract was drawn up, either on the IATA (International Air Transport Association) model or as a one-off. All the contracts covered by this Decision are listed in Table 9.










(51)


At the time the contracts RYAN4, RYAN5 and WIZZ3 were signed, SAGEB was operating Beauvais airport. When the other contracts were signed, Oise CCI was the airport operator.

Table 9


List of airport services contracts concluded between the operators of Beauvais airport and the airlines












Contract code


Airline


Airport operator


Contract type


Date signed


Date in force


Duration





Ryanair





RYAN1


Ryanair


Oise CCI


Letters


8.9.1998


1.1.1999


5 years




RYAN2


Ryanair


Oise CCI


Letters


16.3.2001


Not specified


Not specified




RYAN3


Ryanair


Oise CCI


Letters


12.2.2002


Not specified


10 years




RYAN4


Ryanair


SAGEB


Letters


4.2.2010 and 5.2.2010


1.5.2010


7 months




RYAN5


Ryanair


SAGEB


Letters


27.7.2010


1.1.2011


1 year





Wizz Air





WIZZ1


Wizz Air


Oise CCI


Contract (IATA ground handling agreement)


11.6.2004


11.6.2004


5 years




WIZZ2


Wizz Air


Oise CCI


Contract (IATA ground handling agreement)


1.7.2005


1.7.2005


3 years and 8 months




WIZZ3


Wizz Air


SAGEB


Contract (‘Investment’ agreement and IATA ground handling agreement)


1.6.2009


1.6.2009


5 years





Other airlines





GOOD1


Goodjet


Oise CCI


Contract (one-off)


14.12.2001


14.12.2001


7 years




CIAO1


Ciaofly


Oise CCI


Contract (one-off)


24.4.2002


24.4.2002


7 years




BERL1


Berlin Jet


Oise CCI


Contract (one-off)


30.1.2003


30.1.2003


5 years




VOLA1


Volare


Oise CCI


Contract (one-off)


13.2.2003


13.2.2003


5 years




STER1


Sterling


Oise CCI


Contract (IATA ground handling agreement)


15.7.2004


31.3.2004


5 years




NORW1


Norwegian Air Shuttle


Oise CCI


Contract (IATA ground handling agreement)


7.4.2005


31.3.2004


5 years




AIRH1


Air Horizons


Oise CCI


Contract (one-off)


12.7.2004


18.7.2004


1 year




AIRP1


Air Polonia


Oise CCI


Contract (one-off)


20.10.2004


20.10.2004


5 years




BLUE1


Blue Air


Oise CCI


Contract (IATA ground handling agreement)


11.10.2005


11.10.2005


1 year




BLUE2


Blue Air


Oise CCI


Contract (one-off)


28.8.2007


26.3.2007


8 months




FLYM1


Flyme


Oise CCI


Contract (IATA ground handling agreement)


30.3.2006


31.3.2006


5 years




CENT1


Centralwings


Oise CCI


Contract (IATA ground handling agreement)


18.2.2007


19.2.2007


1 year














(52)


The various contracts were all different; their key features are summarised in Table 10. Several included the possibility of the Beauvais airport operator’s paying a financial contribution to the airline in exchange for the traffic it brought. However, none of the contracts mention marketing payments by the Beauvais airport operator in exchange for advertising by an airline.

Table 10


Features of airport services contracts concluded between the operators of Beauvais airport and the airlines







Contract code


Key features of the contracts





Ryanair





RYAN1


This contract provided for the operation of two routes from Beauvais on the following terms:






—


Dublin: the contract included three weekly turnarounds (two on Saturday and one on Sunday) for a landing fee of FRF 750 (EUR 114,37). For any new additional daily turnaround, the airline was exempted from the landing fee. The contract also included a fee of FRF 10 (EUR 1,52) per departing passenger.










—


Prestwick: the contract included a daily turnaround in exchange for a fee set at FRF 750. For any additional daily turnaround, the landing fee was set at FRF 500 (EUR 77,22). The contract also included a fee of FRF 10 (EUR 1,52) per departing passenger.








RYAN2









The terms of the RYAN1 contract were amended as follows:










—


For the Dublin route, the landing fee was set at FRF 750 for up to 19 weekly turnarounds. Above that number, Ryanair was exempt from the landing fee.










—


For the Prestwick route, the landing fee was set at FRF 750 for up to 7 weekly turnarounds, and FRF 500 for between 8 and 14 weekly departures. Above 14 weekly departures, Ryanair was exempt from the landing fee.










—


For any new route launched by Ryanair, the landing fee was set at FRF 500 for one daily turnaround. For any additional turnarounds, Ryanair was exempt from the fee.










—


The fee per departing passenger was set at FRF 10 for the existing routes, FRF 6 (EUR 1,22) for new routes for up to 6 daily turnarounds, and FRF 4 (EUR 0,61) above that.








RYAN3


This contract replaced the RYAN1 and RYAN2 contracts. It set the terms under which Ryanair operated its air services as follows:






—


For 2002, a target of 210 000  passengers departing from Beauvais was assigned to Ryanair. The landing fee was set at FRF 750 for all routes operated by the airline.










—


For 2003, a target of 310 000  passengers departing from Beauvais was assigned to Ryanair. The landing fee was set at FRF 750 for up to 7 daily turnarounds and FRF 650 (EUR 99,09) above that.










—


For 2004, the passenger target was 410 000  passengers. The landing fee was set at FRF 750 for up to 7 daily turnarounds, FRF 600 (EUR 91,47) for between 8 and 10 daily turnarounds and FRF 400 (EUR 60,98) above that.










—


The departing passenger fee was set at FRF 8/passenger for up to 135 passengers per aircraft (FRF 0 above that) for each year over the duration of the contract.




This contract remained valid until 4 February 2010 on the terms established for 2004.




RYAN4


This contract amended contract RYAN3 by adding the following elements: Ryanair undertook to operate 10 additional weekly turnarounds on new routes. In exchange the airport manager paid a financial contribution to Ryanair of EUR 1,5 per departing passenger on the new routes.




RYAN5


This contract amended contract RYAN4. Under this contract, SAGEB undertook to pay Ryanair a financial contribution of EUR 2 per departing passenger for each additional passenger carried in 2011 compared with the number of passengers carried by Ryanair in 2010. In exchange, Ryanair undertook to operate 26 additional turnarounds per week.





Wizz Air





WIZZ1


In this contract, the landing fees were set for Wizz Air as follows:






—


EUR 500 for the first daily turnaround;










—


EUR 450 for the second and third daily turnarounds;










—


EUR 400 for subsequent daily turnarounds.




The airport manager undertook to pay the airline, for the first 4 years of the contract, a financial contribution in accordance with the number of departing passengers in an amount of one euro per departing passenger, capped at EUR 40 000 , 30 000 , 20 000  and 10 000  respectively in the first, second, third and fourth years. The contract included other optional services such as cleaning the aircraft. The airline was exempt from departing passenger fees.




WIZZ2


This contract amended WIZZ1. The landing fee was now set at EUR 425 for all turnarounds. The financial contribution paid by the airport manager was set at EUR 0,75 per departing passenger.




WIZZ3


The landing fees were set as follows:






—


EUR 425 for up to 20 weekly turnarounds;










—


EUR 42,5 for between 21 and 32 weekly turnarounds;










—


EUR 21,25 for more than 33 weekly turnarounds.




The airline was exempt from departing passenger fees. The airport operator undertook to pay the airline a financial contribution per departing passenger of EUR 0,375 for between 0 and 20 weekly turnarounds, EUR 1,375 for between 21 and 26 weekly turnarounds, EUR 1,725 for between 27 and 32 weekly turnarounds and EUR 1,925 above that.
The contract included other optional services such as cleaning the aircraft.





Other airlines





GOOD1


This contract established a schedule of 24 weekly turnarounds. The landing fee was set at FRF 4 000  (EUR 609,8) and the airline was exempt from the departing passenger fee.




CIAO1


This contract set a landing fee of EUR 305 and exempted the airline from the departing passenger fee.




BERL1


This contract provided for one weekly turnaround. The landing fee was set at EUR 500 and the airline was exempt from the departing passenger fee.




VOLA1


This contract provided for five daily turnarounds. The landing fee was set at EUR 450 and the departing passenger fee at EUR 2,13. The airport manager undertook to provide financial support for launching routes of up to EUR 100 000  per route.




STER1


This contract set the landing fee at EUR 576 for up to 3 weekly turnarounds, EUR 540 for between 4 and 6 weekly turnarounds and EUR 500 for more than 7 weekly turnarounds. The airline was exempt from departing passenger fees. The contract included other optional services such as cleaning the aircraft.




NORW1


This contract set the landing fee at EUR 500 for up to 6 weekly turnarounds and EUR 400 for more than 7 weekly turnarounds. The airline was exempt from departing passenger fees. The contract included other optional services such as cleaning the aircraft.




AIRH1


This contract established a schedule of 5 weekly turnarounds. The landing fee was set at EUR 147,38 and the departing passenger fee at EUR 2,89. The airport manager undertook to pay the airline a financial contribution of EUR 0,5 per departing passenger. The contract also included optional services such as cleaning the aircraft and other services.




AIRP1


This contract provided for one turnaround a day. The landing fee was set at EUR 192,88 and the departing passenger fee at EUR 2,89. The contract also included optional services such as cleaning the aircraft.




BLUE1


This contract set the landing fee at EUR 600 and waived the departing passenger fee for the airline.




BLUE2


This contract amended BLUE1 in respect of the amount of the landing fees, now set at EUR 450.




FLYM1


This contract provided for a minimum of 4 weekly turnarounds. The landing fees were set at EUR 600 for type B737-300 aircraft (136 seats) and EUR 550 for type B737-500 aircraft (125 seats). The airline was exempt from the departing passenger fee.




CENT1


This contract set the landing fee at EUR 500 for up to 3 weekly turnarounds, EUR 450 for between 4 and 7 weekly turnarounds and EUR 400 for more than 7 weekly turnarounds. The airline was exempt from departing passenger fees.
The airport manager undertook to pay the airline a financial contribution of EUR 0,75 per departing passenger for the first 6 months, and EUR 0,50 for the last 6 months.








4.   GROUNDS FOR INITIATING THE FORMAL INVESTIGATION PROCEDURE

4.1.   Financial support to the successive operators of Beauvais airport







(53)


First, the Commission expressed doubts that the financial support granted to Oise CCI and SAGEB did not involve State aid.










(54)


The Commission had doubts as to whether certain activities of Beauvais airport funded by the public authorities fell under the public authority remit. The Commission also had doubts about whether the conditions established by the Altmark (43) ruling were met by the measures for Beauvais airport included in programme 3. The Commission commented that the grounds cited by the public authorities for the investment grants did not refer to their direct financial return. The Commission therefore questioned whether those investments were in line with the market economy investor principle (‘MEO principle’). Lastly, the Commission came to the preliminary finding that the measures were imputable to the State, were selective, and were likely to distort competition and affect trade within the EU.










(55)


Second, the Commission expressed doubts about the compatibility of the investment aid and the operating aid with the internal market pursuant to Article 107(3)(c) TFEU.










(56)


An assessment of the compatibility with the internal market of the measures in favour of the operators showed that, while all the measures met an objective of general interest, their necessity and proportionality in the light of that objective had not been demonstrated. The Commission also had doubts about the medium-term prospects for use of the infrastructure.




4.2.   Measures in favour of the airlines







(57)


In its opening decision, the Commission came to the preliminary view that the signature of the contracts by the airport operator (Oise CCI, then SAGEB) with the airlines involved the use of State resources and that the decisions to conclude the contracts were imputable to the State.










(58)


The Commission was not in a position to give a view on whether the airlines enjoyed a selective advantage. The information at its disposal was insufficient to determine whether the airport manager had behaved like a prudent market economy investor. The Commission invited France and interested parties to provide it with further information.










(59)


The Commission came to the preliminary conclusion that the measures were likely to distort competition and affect trade within the EU.










(60)


Lastly, the Commission expressed doubts as to the compatibility with the internal market of the aid measures in favour of the airlines. In particular, the Commission took the preliminary view that the measures involving aid for new routes did not meet the criteria for compatibility with the internal market.




5.   COMMENTS BY FRANCE

5.1.   Financial support to Beauvais airport

5.1.1.   Investment aid







(61)


France informed the Commission that it ‘did not intend in respect of Beauvais airport to rely on the notion of service of general economic interest for any of the investment grants received by the local authorities and paid over to the successive holders of the concession for Beauvais airport (Oise CCI, then SAGEB)’ (44).










(62)


France also indicated that it did not intend to rely on the application of the MEO principle to the investment grants paid to the successive holders of the concession for Beauvais airport (Oise CCI, then SAGEB) (45).










(63)


However, France took the view that the grants could not be classed as State aid or incompatible State aid on the grounds that they were linked to funding activities under the remit of the public authorities or that their compatibility with the internal market could be demonstrated.




5.1.1.1.   The funding of activities under the remit of the public authorities







(64)


France clarified that the grants disbursed under programme 1 for activities falling under the public authority remit, worth EUR 1 110 669 in total, were as follows (46):






—


grants for safety and security equipment (EUR 922 000);










—


grants for modernising the screening check points (EUR 133 000);










—


grants totalling EUR 55 669 for fees and depreciation costs linked to and declared under the public-remit tasks.














(65)


France clarified that the grants disbursed under programme 2 for activities falling under the public authority remit, worth EUR 567 782 in total, were as follows:






—


grants of EUR 52 670,98 for installing border police booths and EUR 86 085,57 for a laser bird repellent;










—


grants of EUR 165 805 for installing security fencing and EUR 617 for modernising screening check points;










—


a grant of EUR 176 590 for a flow separation corridor;










—


grants totalling EUR 86 632 for fees and depreciation costs linked to and declared under the public-remit tasks common to the investment programmes.














(66)


The grants linked to the public-authority remit over the period 2001-2008 therefore came, according to France, to EUR 1 678 451.










(67)


France also identified three investments scheduled in the PSD agreement for the 2008-2023 period that were linked, in its view, to activities falling under the public-authority remit:






—


installation of an all-weather instrument landing system (category III ILS) for EUR 14 381 000;










—


investments to locate flying clubs and private owners together in the ‘leisure’ zone to the north of the airport for a grant of EUR 1 442 000;










—


supply and fitting out of a 50 m2 space in Terminal T2 for the institutional tourism agencies (under ‘construction of Terminal T2’) for an amount of EUR 54 000.














(68)


According to France, the total amount of the investments referred to in recital 67 and implemented under the PSD agreement (2008-2023) came to EUR 15 877 million. Thus, the maximum grant of EUR 14,5 million paid to SAGEB under the PSD agreement constituted consideration for the investments linked to activities falling under the public-authority remit and therefore could not be classed as State aid.










(69)


France outlined the following arguments to demonstrate that the investments referred to above fell under the remit of the public authorities:






—


the tasks connected with these investments were performed either directly by the State, or on its instructions;










—


the tasks connected with these investments were required under European and national rules;










—


the tasks connected with these investments were performed in the general interest or public interest (e.g. protection of human life, aviation security, border police, animal hazard prevention, air traffic services, tourism development);










—


the performance of the tasks connected with these investments by the successive airport concession holders was entirely non-commercial;










—


it had been recognised by EU and French case-law that the tasks connected with these investments fell under the remit of the public authorities.














(70)


Specifically with reference to the all-weather instrument landing system, France argued that this fell under the provision of air navigation services, which was a public-authority task. The system was designed to prevent aircraft collisions on landing and in the manoeuvring area, expedite and maintain an orderly flow of air traffic, and provide advice and information useful for the safe and efficient conduct of flights. However, France pointed out that such systems were not installed by right at airport hubs and were not covered by the airport tax.










(71)


As for the investments in locating flying clubs and private owners together to the north of Beauvais airport, France considered that this measure put a stop to the movement of the aircraft, passengers and staff of flying clubs and private owners across the restricted access zones, thus ensuring better control of access to these zones and better guaranteeing flight safety, which was a task under the responsibility of the public authorities.










(72)


France also took the view that fitting out a space of 50 m2 in Terminal T2 for the institutional tourism agencies allowed them to carry out their task of promoting local tourism at Beauvais airport. In France’s view, developing tourism was a public-authority task, to which the fitting out of the dedicated space was connected.




5.1.1.2.   Compatibility of the investment aid with the internal market







(73)


The French authorities informed the Commission that they endorsed the application to the case in hand of the criteria from the Guidelines in force at the time of the investment aid measures, in accordance with point 173 of the 2014 Guidelines.










(74)


France argued that all the investment grants were compatible with the internal market in the light of the compatibility criteria laid down in the 2005 Community guidelines on financing of airports and start-up aid to airlines departing from regional airports (47) (‘the 2005 Guidelines’).





Clearly defined objective of general interest







(75)


According to France, all the measures at issue were such as to meet a clearly defined objective of general interest, namely local economic development. Moreover, the Commission had in the past found that airport safety and security constituted an objective of general interest and, in the case at hand, most of the investment over the relevant period also met this objective.





The infrastructure is necessary and proportionate to the objective







(76)


France stated that the infrastructure put in place was indispensable to the smooth functioning of Beauvais airport in view of the increase in passengers that could reasonably be expected. Most of the investment corresponded to urgent work on security and upgrading at Beauvais airport in a situation of rapid growth in air traffic at the airport.










(77)


Moreover, these investments were proportional to the objective in so far as, according to France, the investment amount was always extremely conservative, in particular as it was based on very low traffic forecasts compared with the traffic volumes actually achieved. The investments could have been much more far-reaching and far more costly in view of the traffic volumes actually achieved.





The infrastructure has satisfactory medium-term prospects for use







(78)


France stressed that the investments made at Beauvais airport during the period 2001-2006 were based on traffic assumptions of 600 000 passengers for 2006. The investments under programme 2 were also based on a traffic assumption of 18 000 movements in the medium term, and programme 3 had been drawn up by SAGEB to take account of a reference scenario involving a maximum of 21 000 movements per year.










(79)


The growth in flights operated by Ryanair observed at the time of the decisions on the investment programmes and the geographical proximity of Paris tended to confirm the positive prospects for use in the medium term.





All potential users of the infrastructure have access to it in an equal and non-discriminatory manner







(80)


France stated that no airline operating at Beauvais airport nor any of their passengers had been given an advantage in terms of access to the different equipment and infrastructure provided by the airport.





Trade is not affected contrary to the common interest







(81)


In France’s view, the existence of Beauvais airport relieved the air traffic congestion at the Paris airports, particularly Roissy-Charles de Gaulle.










(82)


Moreover, without denying that Beauvais airport might attract some of the customers from Roissy-Charles de Gaulle airport, France explained that this should be viewed in proportion to the greater accessibility and number of destinations offered by the latter, and to the curfew imposed at Orly airport. As for Amiens and Rouen airports, they had not developed any commercial traffic.





Necessity and proportionality of the aid







(83)


The aid intensity for programme 1 was around two thirds of the total amount to be financed. For programme 2 the aid intensity was as high as 74 %, but this could be explained by the short depreciation period of the works (just over one year) because of the short period during which the concession agreement between the State and Oise CCI was extended. For programme 3, France estimated the aid intensity at around 21,26 %, pointing out that this was a ceiling and that the final aid amount might be lower depending on the investments actually carried out.










(84)


France explained that the high intensity of the aid granted to Oise CCI for the investment programmes 2001-2006 and 2006-2008 was necessary in so far as without this aid, Oise CCI would not have been able to implement all the investments decided upon and could therefore not have met the need to upgrade and increase the security of the infrastructure. France stressed in this connection that Oise CCI had taken out a loan to cover its share of the funding under the two investment programmes, so it could not have made a bigger contribution.




5.1.2.   Operating aid







(85)


First, as regards the operating aid, France argued that Oise CCI had received very low amounts in subsidies over the period 1996-2008. These subsidies could not therefore have distorted competition or affected trade between Member States.










(86)


Of the EUR 107 924,59 received, France estimated that:






—


a grant of EUR 68 000 disbursed in 2002 was to finance the exceptional measure of increasing the rate of passenger hand baggage checks from 25 % to 50 % after the attacks of 11 September 2001;










—


a sum of EUR 1 600,10 paid in 2002 corresponded to a transfer from the Association for managing funds for the integration of people with a disability (Association de gestion du fonds pour l’insertion des personnes handicapées), in reimbursement of a surplus contribution by Oise CCI;










—


an amount of EUR 2 005 paid in 2005 corresponded to a transfer from the national centre for the development of farm structures (centre national pour l’aménagement des structures des exploitations agricoles);










—


a sum of EUR 5 829,49 paid out in 2005 corresponded to a grant from the town of Tillé for sanitation work linked to the connection of pavilions belonging to the airport concession to the public waste water system, which Oise CCI did on behalf of the town;










—


two grants of EUR 15 245 each corresponded to the reimbursement by the department of Oise for tourism promotion services performed by the staff of Oise CCI’s airport arm.














(87)


France explained that the grant of EUR 68 000 was linked to a security task and therefore did not constitute State aid. As regards the other payments, they were no more than a fair consideration for services carried out by Oise CCI or reimbursement of excessive contributions to associations of which Oise CCI was a member.










(88)


Second, as regards the advances from Oise CCI’s general arm to its airport arm, France took the view that the advances granted before the Aéroports de Paris judgment of 12 December 2000 did not constitute aid in accordance with point 29 of the 2014 Guidelines. Therefore, only the advances granted in 2001, 2002 and 2004 could constitute State aid.










(89)


Furthermore, the advances made in 2001 and 2002 (which had been repaid in full) were granted at a time when Beauvais airport had recorded, in the two financial years preceding the one in which the aid was granted, traffic of less than 700 000 passengers per year. In accordance with point 118 of the 2014 Guidelines, the airport was unlikely to be able to cover its operating costs to a substantial extent, which justified the zero rate. Regarding the advance made in 2004, France took the view that Beauvais airport had, in the two financial years preceding the one in which the aid was granted, recorded traffic of between 700 000 and 1 million passengers per year. On top of the interest waived on this advance of 2004, France emphasised that Beauvais airport was not covering all its operating costs and therefore certainly met the requirements of point 118 of the 2014 Guidelines.










(90)


Lastly, regarding the advantage granted to SAGEB in the form of the exemption from tourism expenditure that it should have borne as the airport manager, France argued that SAGEB had neither the authority nor the remit for local and regional tourism development and that it had not received any subsidy in this connection.










(91)


France asserted that tourism development was a State task pursuant to national legislation. The tourism development plan could be implemented only by the local authorities (SMABT in this instance) and was not designed to boost business at the airport but rather to encourage regional tourism. France added that the objectives of the tourism development plan had been set by SMABT alone and implemented by the tourism agencies, with no input or influence from SAGEB. On the contrary, SAGEB had to contribute financially to the initiatives and supply if needed the means for these agencies to carry out their tasks (premises, advertising within the airport, etc.).










(92)


France further stated that none of the initiatives under the tourism development plan had the objective of promoting Beauvais airport or the flight destinations it offered. Media used by SAGEB to that end were outside the scope of the tourism promotion remit and were financed by SAGEB from its own funds.










(93)


Since none of the grants covered in these comments (with the exception of the cash advances in 2001, 2002 and 2004) constituted State aid, France found that there was no need to demonstrate their compatibility with the internal market. In any event, the French authorities stated that they endorsed the application to the case in hand of the criteria set out in point 137 of the 2014 Guidelines in respect of the operating aid.




5.2.   Measures in favour of the airlines







(94)


France argued that the airport operator (Oise CCI, then SAGEB) behaved like a prudent market economy investor. All the contracts generated incremental profitability and did not confer an advantage on the airlines within the meaning of Article 107(1) TFEU.










(95)


France also stressed that the Beauvais airport operators never signed a marketing contract for the supply of marketing services (publicity on a website or equivalent) by an airline. The marketing contributions that the operators paid under certain contracts were incentives for the airlines to develop their traffic, that generated additional revenue for the operators (bus, non-aeronautical revenues).










(96)


France stated that Oise CCI was not able to provide economic analyses conducted prior to the signature of the individual contracts with the airlines when it was the airport operator. However, Oise CCI acted like a market economy investor despite the absence of ex ante economic analyses and systematically took decisions on accepting a new airline or opening new routes with a view to developing a profitable airport business. In this connection, France supplied a general budget simulation (for the entire airport business) carried out ex ante by Oise CCI for the period 2001-2006. According to this simulation, the airport could generate a positive overall cash-flow from developing the business of Ryanair and other airlines (75 % and 25 % respectively of projected revenue in 2006).










(97)


Following the opening decision, France reconstructed incremental business plans for the contracts concluded by Oise CCI and the airlines referred to in Table 9 (with the exception of the RYAN1 and RYAN2 contracts for which no reconstructed business plan was provided). France indicated that these business plans had been reconstructed on the basis of information known to Oise CCI before the conclusion of the contracts and on the basis of traffic, revenue and cost assumptions that would have been deemed reasonable prior to the signature of the contracts. These reconstructed business plans show that, on the basis of the assumptions adopted by France, Oise CCI could legitimately expect to generate a profit when signing each of the contracts with the airlines.










(98)


France supplied the economic analyses (project summaries, business plans) carried out by SAGEB, Beauvais airport operator at the time, ahead of all the contracts signed by it and listed in Table 9, namely RYAN4, RYAN5 and WIZZ3. These economic analyses showed that the contracts generated a profit for the airport operator. Following the opening decision, France indicated that these analyses were based on average costs, rather than incremental costs. France therefore submitted revised versions of these three analyses (i.e. produced after the contracts had been signed) based on an incremental rise in costs, that confirmed that the three contracts did generate incremental profits for SAGEB.










(99)


France therefore argued that SAGEB did not receive any operating subsidies (aside from those relating to the public-authority tasks), and that the risks and responsibilities borne by SAGEB were shared between Oise CCI and Véolia. In particular, by virtue of the shareholder agreement signed between Oise CCI (51 % of the votes) and the private company Véolia (49 % of the votes), SAGEB’s decisions to sign the contracts with the airlines were subject to the approval of the shareholders by a qualified majority of 75 % of the votes. The contracts signed by SAGEB thus could not be signed without the approval of Véolia, and the latter’s endorsement of the contracts with the airlines was evidence that they conformed to market practice.










(100)


France also submitted that no investment at the airport was made for the benefit of a specific airline. The airport operator had entered into contact with numerous airlines in order to diversify its customer base. Even though Ryanair accounted for 80 % to 90 % of airport traffic between 1999 and 2011, the infrastructure was accessible on non-discriminatory terms to all the airlines and was constructed as part of an airport development plan without being linked to a specific contract.




6.   COMMENTS BY INTERESTED PARTIES

6.1.   Comments by interested parties on the application of the 2014 Guidelines to the case at hand

6.1.1.   Joint comments from Oise CCI, SMABT and SAGEB







(101)


As regards the investment grants covered by this Decision, Oise CCI, SMABT and SAGEB understood that their compatibility would be assessed in the light of the 2005 Guidelines. Furthermore, the grants made to Beauvais airport before 12 December 2000 would not be contested on the basis of the State aid rules, in accordance with the Aéroports de Paris ruling (48).










(102)


As regards the financial relations between Beauvais airport and airlines operating there, Oise CCI, SMABT and SAGEB understood that they would be assessed in the light of the new 2014 Guidelines.




6.1.2.   Comments by Air France







(103)


In connection with the investigation, Air France submitted comments restricted to the application of the 2014 Guidelines. Air France contested the retroactive application of the 2014 Guidelines to cases involving operating aid to airports even where such aid had been disbursed before they had been published, on a number of grounds:






—


According to Air France, retroactive application of the 2014 Guidelines favoured unscrupulous operators by legitimising behaviour that did not comply with the rules applicable at the time. By contrast, operators who did comply with the previous Guidelines by refraining from claiming public funds were penalised.










—


Air France also emphasised that the retroactive application of the 2014 Guidelines to operating aid granted to airports was contrary to the general principles of law and to EU case-law.










—


Air France claimed that the 2014 Guidelines would have the effect of favouring new operators to the detriment of incumbent operators. By allowing a new airline to pay only the incremental cost associated with its activity, they would discriminate against incumbent operators at the airport, who were subject to higher fees.










—


Lastly, Air France commented that, although the condition of non-discriminatory access to the infrastructure of an airport may seem easy to meet in theory, the situation was quite different in practice, with certain operating models being consciously disadvantaged.








6.2.   Joint comments from Oise CCI, SMABT and SAGEB







(104)


Oise CCI, SMABT and SAGEB submitted joint comments to the Commission.




6.2.1.   Financial support to Beauvais airport







(105)


Regarding the investment aid and the operating aid covered by the formal investigation procedure, Oise CCI, SMABT and SAGEB referred in full to the comments submitted by France.










(106)


Oise CCI, SMABT and SAGEB further supplied in support of the arguments submitted by France an analysis of the competition exerted by Beauvais airport on the passenger transport market, produced by the independent consultant Microeconomix. This study concluded that the aid to Beauvais airport had not affected trade to an extent contrary to the common interest.










(107)


First, according to the study, the aid paid to Beauvais airport had not affected competition with the two other Paris airports, Roissy and Orly. The study did not rule out demand substitutability, at least in part, between Roissy and Orly airports and Beauvais airport, as the catchment area of the three airports partly overlapped (49). Beauvais airport hosted exclusively low-cost traffic between 2000 and 2011, while Orly and Roissy also had low-cost traffic, but it accounted in 2011 for only 13,6 % of total traffic for the two airports, i.e. a minority share (50). None the less, the study ruled out the possibility of the investment aid’s affecting trade on the following grounds:






—


The study showed that Beauvais airport’s market share remained low (e.g. 4 % in 2011) within the regional airport market that it formed with Roissy and Orly airports. Specifically on the low-cost market in the Paris region, Beauvais airport’s market share came to 31 % in 2011, compared with the shares of Roissy and Orly.










—


The aid did not prevent the development of low-cost traffic at Orly and Roissy. The share of low-cost increased as a proportion of total traffic at the two airports by 5,7 % between 2009 and 2010, then 11,3 % between 2010 and 2011. So, even if the development of Beauvais airport might have restricted the number of new low-cost routes opened in the other two airports, it did not block its development.










—


The study stressed that none of the airlines operating at Beauvais airport were present in the two other Paris airports and that certain destinations were only offered from Beauvais (Bari, Bergen, Cagliari, Cluj-Napoca, Katowice, Lodz and Shannon).










—


Detailed analysis of a sample of destinations served by Roissy, Orly and Beauvais (51) in fact showed fierce competition between Orly and Roissy and relative autonomy for Beauvais airport’s traffic. For example, on the Paris-Barcelona route, offered by the three Paris airports, the study showed that demand at Roissy contracted significantly between 2008 and 2010, which resulted in a strong increase in demand at Orly, while traffic at Beauvais (52) remained stable over the same period. This was even more noticeable on the Paris-Rome or even Paris-Milan routes, where the Roissy and Orly curves broadly correlated, while the Beauvais distribution curve bore no relation to them. On the Dublin and Stockholm routes, offered only at Beauvais and Roissy airports, when the traffic fell between 2007 and 2011 at Beauvais airport, it also fell (for Dublin) or stagnated (for Stockholm) at Roissy.










—


The study showed that if there was substitutability between Beauvais airport and the other Paris airports, it was limited. It remained far easier to access Orly and Roissy from Paris by any means of transport (53). Thus, only passengers with low sensitivity to access times (and thus high price sensitivity) were likely to consider Beauvais airport as a credible alternative to the other two Paris airports.










—


The study also stressed that the presence of Beauvais airport had reduced congestion at the Paris airports (Roissy and Orly). Orly in particular was subject to a cap on air traffic movements that it had almost reached in 2011, making it a saturated airport that would not have seen, or only to a limited extent, an increase in traffic in the absence of Beauvais airport. As for Roissy, the study referred to a report of March 2011 by the European Commission finding that the airport would face demand in excess of its capacity by 2025.














(108)


Second, according to the study, the development of Beauvais airport did not affect potential competition with other (rail) links from Paris to national and international destinations (54).




6.2.2.   Financial support to the airlines







(109)


Oise CCI, SMABT and SAGEB indicated that Oise CCI and SAGEB, as successive operators of Beauvais airport, acted, in their contractual relations with the airlines operating flights from and to the airport, in accordance with the MEO principle.










(110)


Oise CCI, SMABT and SAGEB referred in this connection to the analyses done by France, and also sent the Commission a detailed business plan relating to the contract of 12 February 2002 concluded with Ryanair. In their view, the business plan showed the profitability prospects of this contract for the economic activity of the airport.




6.3.   Comments by the airline Ryanair







(111)


Ryanair submitted comments only in respect of the financial support granted to the airlines by the successive managers of Beauvais airport covered by this Decision. Its comments were as follows.










(112)


First, Ryanair disputed the assertion that the airport services contracts concluded in this case were imputable to the State and financed through State resources. Oise CCI was not just another facet of the French State and imputability could not be established solely on the basis that Oise CCI was a public undertaking and therefore under the control of the French State. Nor were the charges the only revenue for Oise CCI, which had its own revenue from its commercial activities. As for SAGEB, given its capital ownership, Ryanair doubted whether it could be considered to act under the control and instructions of the public authorities.










(113)


Second, Ryanair took the view that the airport services contracts had been concluded in accordance with the MEO principle.










(114)


The Commission should compare the agreements concluded with Beauvais airport with the contracts concluded with airports that behaved like private investors. Referring to the case-law of the Court of Justice (55), it argued that only where no MEO test was possible should the Commission adopt a cost-based approach.










(115)


Moreover, even if the Commission were to take a cost-based approach, Ryanair believed that the airport services contracts had been concluded in line with the MEO principle and had been very profitable for Beauvais airport. In support of its arguments, Ryanair supplied a study by the independent consultant Oxera showing that all the airport services contracts it had signed with Beauvais airport were in line with the MEO principle (56).










(116)


Since the measures did not constitute State aid within the meaning of Article 107(1) TFEU, there was no reason to examine their compatibility with the internal market.




6.4.   Comments by the airline Wizz Air







(117)


Wizz Air submitted comments only in respect of the financial support granted to the airlines by the successive managers of Beauvais airport covered by this Decision. Its comments were as follows.










(118)


First, Wizz Air disputed the assertion that the airport services contracts concluded in this case were imputable to the State and financed through State resources. Oise CCI was not just another facet of the French State and imputability could not be established solely on the basis that Oise CCI was a public undertaking and therefore under the control of the French State. In particular, France had no power to take part in Oise CCI’s decision-making, the role of the French State being confined to the oversight of certain decisions. Nor were the charges the only revenue for Oise CCI, which had its own revenue from its commercial activities. As for SAGEB, given its capital ownership, Wizz Air doubted whether it could be considered to act under the control and instructions of the public authorities. Such an approach would be contrary to the Stardust Marine case-law, according to which ‘the criterion of control of an undertaking by the State is not, purely on its own, sufficient to establish that the conduct of that undertaking is imputable to the State’ (57).










(119)


Second, Wizz Air took the view that the airport services contracts had been concluded in accordance with the MEO principle.










(120)


Like Ryanair, Wizz Air believed that the Commission should compare the agreements concluded with Beauvais airport with the contracts concluded with airports that behaved like private investors. Referring to the case-law of the Court (58), Wizz Air argued that only where no MEO test was possible should the Commission adopt a cost-based approach (59).










(121)


Moreover, even if the Commission were to take a cost-based approach, Wizz Air believed that the airport services contracts had been concluded in line with the MEO principle and had been very profitable for Beauvais airport. In support of its arguments, Wizz Air supplied a study by the independent consultant Oxera showing that all the airport services contracts it had signed with Beauvais airport were in line with the MEO principle (60).










(122)


Wizz Air confirmed the Commission’s position that the MEO principle had to be applied in the light of all the contractual and commercial agreements concluded with the successive managers of Beauvais airport. The airport services contract concluded between Wizz Air and Oise CCI in 2005 set a marketing contribution for Oise CCI at EUR 0,75 per passenger departing from Beauvais. This contribution had been reduced to EUR 0,375 per departing passenger in the airport services contract of 1 June 2009. According to Wizz Air, these payments were not intended for it, but were paid directly into a bank account and used exclusively to pay third parties with no link to Wizz Air that supplied marketing services such as advertising campaigns in print media or online.




7.   COMMENTS BY FRANCE ON THE INTERESTED PARTIES’ COMMENTS







(123)


France had no comments on the submissions by interested parties.




8.   ASSESSMENT OF THE MEASURES

8.1.   Financial support to Oise CCI and SAGEB

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







(124)


Article 107(1) TFEU states that ‘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 shall, in so far as it affects trade between Member States, be incompatible with the internal market.’










(125)


For a measure to be classed as State aid, therefore, all of the following criteria have to be met:






—


the beneficiary must be an undertaking within the meaning of Article 107(1) TFEU, which presupposes that it carries on an economic activity,










—


the measure in question must be granted through State resources and be imputable to the State,










—


the measure in question must confer an economic advantage on its beneficiary or beneficiaries;










—


the measure in question must be selective in that it favours certain undertakings or the production of certain goods, and










—


the measure in question must distort or threaten to distort competition and be likely to affect trade between Member States.








8.1.1.1.   Investment grants


Economic activity







(126)


Article 107(1) of the Treaty does not apply where the State acts ‘by exercising public power’ (61) or where public entities act ‘in their capacity as public authorities’ (62). An entity may be deemed to act by exercising public power where the activity in question forms part of the essential functions of the State or is connected with those functions by its nature, its aim and the rules to which it is subject. Moreover, the 2014 Guidelines (63) specify that not all the activities of an airport are necessarily of an economic nature. The Court has held that activities that normally fall under the responsibility of the State in the exercise of its 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. At an airport, activities such as air traffic control (64), police (65), customs, firefighting (66), 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.










(127)


However, the public funding of such non-economic activities does not constitute State aid, but should be strictly limited to compensating the costs to which they give rise and may not be used for other activities. Any possible overcompensation by public authorities of costs incurred in relation to non-economic activities may constitute State aid. Moreover, if an airport is engaged in non-economic activities, alongside its economic activities, separated cost accounting is required in order to avoid any transfer of public funds between the non-economic and economic activities.










(128)


Moreover, public financing of non-economic activities must not lead to undue discrimination between airports. Indeed, it is established case-law that there is an advantage when public authorities relieve undertakings of the costs inherent to their economic activities (67). Civil airports which, in contrast to other civil airports, do not bear certain costs associated with their operation, could benefit from an advantage, whether or not those costs are linked to an activity considered to be of a non-economic nature.










(129)


The Commission notes that the investments referred to in recitals 64 and 65 related to infrastructure or equipment necessary for firefighting, security and aviation safety. However, according to the 2014 Guidelines, those activities are intrinsically part of the essential functions of the State (68), as concluded by the Commission in previous decisions (69). In the absence of the introduction of market mechanisms for the activities referred to in recitals 64 and 65, they did not, therefore, constitute economic activities at the time the investments in question were granted. Consequently, given that the contributions paid by the public authorities under programmes 1, 2 and 3 were not formally allocated to specific costs, the Commission considers that part of the total amount of the subsidies paid under programmes 1 and 2 corresponding to the investment amounts referred to in recitals 64 and 65 related in principle to public-remit activities. The Commission would add that the costs related to the purchase of security equipment under programme 3 (70) can also come under the public-remit activity of aviation security.










(130)


The Commission also considers that the investments referred to in the previous recital were all eligible for a national scheme to finance public-remit tasks (71) and could have been fully financed by that scheme if they had not been covered by the investment grants in question. The Commission has concluded in previous decisions (72) that this national financing scheme provided for by French law was based on strict cost control mechanisms, both ex ante and ex post, ensuring that the scheme would grant airport managers only the amounts strictly necessary to cover costs. Moreover, that system applied to all French civil airports, including Beauvais airport, at the time when the measures at issue were granted, in particular as regards the scope of the tasks giving rise to compensation. Finally, that system provided for separation of accounts between the commercial and public-remit activities of the airport for the purpose of declaring costs to the French Civil Aviation Authority. The non-discrimination condition is therefore met.










(131)


Consequently, the grants of EUR 1 110 669 awarded under programme 1, EUR 567 782 under programme 2 and EUR 10,2 million (73) under programme 3 did not constitute State aid.










(132)


On the other hand, the Commission considers that the investments referred to in recital 67 are not linked to public-remit activities.










(133)


As regards, in the first place, the all-weather instrument landing system (ILS III), the Court held that ‘that instrument, even if it were mandatory and though it is indisputable that it contributes, like other systems, to the safety of landings, plays no part either in the control and supervision of airspace, [...] or in the performance of any other public policy remit which might be exercised at an airport. It contributes to the delivery of the services offered by a civil airport in a competitive context to airlines within the framework of its general activity, which is an economic activity’ (74).










(134)


Secondly, with regard to the investments enabling flying clubs and private owners to be brought together in the ‘leisure’ zone to the north of the airport, the Commission considers that, although this measure helps to improve the safety of air traffic at the airport, it falls first and foremost within the commercial operation of Beauvais airport and contributes to the delivery of the services offered by a civil airport, in a competitive context, to airlines within the framework of its general activity, which is an economic activity.










(135)


Finally, as regards the development of a specific area within the airport dedicated to institutional tourism development bodies, it should be noted that, according to the settled case-law of the Court, there is no cause to dissociate the activity of building or enlarging infrastructure from the subsequent use to which it is put, and that the nature of the construction activity must be determined according to whether or not the subsequent use of the infrastructure which has been built amounts to an economic activity (75). The Commission notes that in the present case, under Article 6 of the PSD agreement, while the space in question was to be made available to local public tourism bodies for the purpose of promoting local tourism, it could also be used to sell services such as ‘guided tours, hotel reservations, etc.’ and regional tourism products. The latter point was, moreover, confirmed by France itself in its observations of April 2014, without demonstrating that such activities involving the sale of services and products represented only a negligible part of the activity of local public tourism bodies. In these circumstances, the Commission considers that the 50 m2 space within the airport was intended to be used to carry out an economic activity. Therefore, the construction of that space by SAGEB was also an economic activity and its financing falls within the scope of the State aid rules.










(136)


In any event, even if those investments were to be linked to public-remit activities, they were not eligible for the financing provided for by the national financing scheme for public-remit tasks, with the result that France has not demonstrated that other airports could benefit from subsidies to finance those same investments. As a result, Beauvais airport was relieved of costs which other airports could have or had to bear themselves, thereby discriminating against them.





Imputability to the State and transfer of State resources







(137)


It follows from settled case-law that measures adopted by intra-state entities of the Member States, whatever their legal status and description, fall, in the same way as measures taken by the central authority, within the ambit of Article 107(1) TFEU, if the conditions laid down in that provision are satisfied (76).










(138)


The investment grants in question were awarded by the Region of Picardie, the Department of Oise and the Beauvais intermunicipal authority (CCB) successively to Oise CCI and SAGEB, either directly (2002-2008) or via SMABT (2008-2023), of which these three local authorities were exclusive members (77). With regard to SMABT, the Commission also notes that this publicly owned establishment is no more than a group of local and regional authorities which has no employees of its own (the officials of the Oise department are made available to SMABT) and whose decisions (in particular budgetary ones) are taken by a joint committee composed of representatives of the three local and regional authorities that are members.










(139)


Consequently, the measures granted by these entities are imputable to the State. Moreover, the resources of local authorities and SMABT (whose resources are exclusively financed from the budget of the local authorities and subject to budgetary oversight by the State – see recital 18) should be regarded as State resources within the meaning of Article 107(1) TFEU (78).





Existence of an advantage







(140)


To determine whether a State measure constitutes aid to an undertaking, it must be determined whether the undertaking 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. That assessment is made, in principle, by the application of the market economy operator test (MEOP).










(141)


Consequently, when an airport benefits from public funding, the Commission will assess whether such funding constitutes aid by considering whether in similar circumstances a private operator, having regard to the foreseeability of obtaining a return and leaving aside all social, regional-policy and sectoral considerations, would have granted the same funding.










(142)


However, it follows from the case-law (79) that, as a general rule, the private investor test is applicable where the Member State has acted as an economic operator, and not as a public authority, by conferring an economic advantage on an undertaking. The private investor test should thus be applied where the conduct of the Member State could have been adopted, at least in principle, by a private operator acting with a view to profit or to limit losses (80).










(143)


The Commission notes first of all that the French authorities consider that the operation of Beauvais airport as a whole should not be regarded as a service of general economic interest (SGEI) (81). It also notes that the French authorities also did not call for the MEO principle to be applied to the investment grants awarded in this case.










(144)


Nonetheless, it should be borne in mind that the MEO principle is not an exception that applies only if a Member State requests it. Where it is applicable, this principle is among the factors which the Commission is required to take into account for the purposes of establishing the existence of aid. Where the Member State does not invoke the MEOP, in order to determine whether the test is applicable, it is necessary to use as a starting point the economic nature of the Member State’s action and not how that Member State, subjectively speaking, intended to act or which alternative courses of action it considered before adopting the measure in question (82).










(145)


As stated in recital 17, the State was the owner of Beauvais airport until 1 March 2008, while Oise CCI was responsible for managing and running it under a temporary authorisation to occupy the public domain, followed by a public equipment concession.





Programme 1







(146)


With regard to programme 1, the Commission considers that the local authorities which granted the subsidies provided for under programme 1 to Oise CCI did not act in their capacity as economic operators.










(147)


Indeed, the Commission considers that the Region of Picardie, the Department of Oise and the Beauvaisis intermunicipal authority (CCB) could not expect, under programme 1 and at the time when the investment grants were awarded (83), to obtain any financial return on their contribution to the investments made in Beauvais airport by Oise CCI.










(148)


The three local authorities referred to above were not shareholders in Oise CCI and had no title of ownership in the airport at the time the aid was granted. Moreover, the financing agreements concluded by each authority with Oise CCI (84) did not contain any optional or compulsory profit-sharing schemes in return for the subsidies awarded.










(149)


In addition, these subsidies were awarded with the sole aim of supporting the development of the regional economy and enhancing environmental protection and the safety of local residents (85). However, public interest considerations cannot be taken into account when applying the market economy operator test (86).










(150)


It cannot therefore be concluded that the conduct of the authorities referred to above could have been adopted, at least in principle, by a private operator acting with the aim of making a profit. The MEO criterion is therefore not applicable in the present case with regard to the subsidies granted under programme 1.










(151)


Given that, at the time the subsidies were granted, Oise CCI was responsible under the 1997 AOT for developing the infrastructure and equipment of Beauvais airport (87), it was therefore required to bear the cost of the investments referred to in recital 37, with the exception of investments falling within the scope of public-remit tasks (88). The investment grants it received under programme 1 thus enabled it to avoid having to bear costs that would normally have had to be met out of its own financial resources. Consequently, these subsidies conferred an economic advantage on Oise CCI.





Programme 2







(152)


The considerations set out in the context of programme 1 also apply to the subsidies awarded under programme 2. Indeed, the Commission considers that the local authorities which awarded the grants to Oise CCI provided for under programme 2 did not act in their capacity as economic operators.










(153)


However, the Commission notes that, while the financing agreement between Oise CCI and the Department of Oise was concluded on 18 December 2006 (i.e. before the date on which ownership of the airport was transferred to SMABT), the financing agreements with the Region of Picardie and the CCB were concluded after 1 March 2007, i.e. after the date on which the agreement granting ownership of Beauvais airport to SMABT with effect from 1 March 2008 was signed (89). Nonetheless, the Commission considers that the MEO principle should not be applied to the subsidies paid under programme 2 for the following reasons.










(154)


First of all, each of the local authorities concluded the financing agreements with Oise CCI on an individual basis and not on behalf of or in the name of SMABT. Yet only SMABT, i.e. the entity comprising those three authorities and not each authority individually, could expect a financial return on the investments financed. In this sense, SMABT’s articles of association do not provide for any form of redistribution of profits made in the course of its activities to its member authorities. Moreover, none of the financing agreements contained an optional or compulsory profit-sharing scheme in return for the subsidies awarded.










(155)


In addition, these subsidies were awarded with the sole aim of supporting the development of the regional economy and enhancing environmental protection and the safety of local residents (90). However, public interest considerations cannot be taken into account when applying the market economy operator test.










(156)


It cannot therefore be concluded that the conduct of the authorities referred to above could have been adopted, at least in principle, by a private operator acting with the aim of making a profit. The MEO criterion is therefore not applicable in the present case with regard to the subsidies granted under programme 2.










(157)


Given that, at the time the grants were awarded, Oise CCI was responsible under the 2002 public equipment concession for developing the infrastructure and equipment of Beauvais airport (91), it was therefore required to bear the cost of the investments referred to in recital 39, with the exception of investments falling within the scope of public-remit tasks (92). The investment grants it received under programme 2 thus enabled it to avoid having to bear costs that would normally have had to be met out of its own financial resources. Consequently, these subsidies conferred an economic advantage on Oise CCI.





Programme 3







(158)


As regards the investment grants paid by SMABT to SAGEB under the PSD agreement, the Commission notes that those grants were provided for in the agreement in order to support the implementation of the investment programme imposed on SAGEB at its own expense. In the context of that agreement, SMABT, as the contracting authority, was paid a fixed land lease fee of EUR 10 795 243 for the entire duration of the PSD agreement (93) as well as a share of the profits from its investments (94). The entitlement to a share of profit was triggered under certain conditions (95) and its amount was set at 50 % of excess profit (96).










(159)


The Commission further notes that these conditions were established following an invitation to tender for the concession to operate Beauvais airport and the route linking the airport to Paris, under the terms of which the applicants were required to include an investment plan in their tender. The call for tenders consisted of a negotiated procedure with publication. After five applications and four tenders had been submitted, SMABT decided to select two tenders and to start negotiations with two consortia: Oise CCI-Veolia, and the consortium comprising Vinci, Airports-Vinci, SA Keolis and Group K Finance. After inviting the two consortia to submit final tenders, primarily on the basis of a benchmark scenario providing for controlled growth of air traffic limited to 21 000 movements by 2022, SMABT eventually awarded the concession contract to the Oise CCI-Veolia consortium.










(160)


In the first place, the Commission considers there to be little doubt that the MEO principle was applicable to the investment grants paid by SMABT to SAGEB under the PSD agreement.










(161)


As the owner of Beauvais airport, SMABT decided to pay these grants under the PSD agreement, providing for delegation of the management of the airport to SAGEB, with financial compensation for SMABT. In other words, the public authority, as the infrastructure owner, decided to outsource its management to a third party operator in return for a financial consideration. This approach could be adopted, at least in principle, by a private operator acting with the aim of making a profit or leveraging the value of an asset it owns by outsourcing its management to a third party.










(162)


In addition, the decision delegating the concession for the management of Beauvais airport was taken with a view to entrusting the concession holder with the tasks of maintaining and operating Beauvais airport, operating the bus route between Paris and Beauvais airport and conducting an investment programme aimed at developing the airport’s commercial infrastructure (recital 19). The overall purpose of these tasks was therefore primarily commercial. The same is true of the objectives pursued by SMABT, one of which was to increase commercial traffic up to the maximum capacity permitted by law (see recital 167).










(163)


It follows that the existence of a potential selective advantage granted under programme 3 must be analysed in accordance with the MEO principle.










(164)


As indicated in recital 159, the grants under programme 3 were part of a contractual package for which SMABT organised a tender procedure. Therefore, in order to verify whether those grants conferred an advantage on SAGEB which it would not have obtained under normal market conditions, the Commission must analyse whether the tender procedure, which provided for the payment of grants where necessary, was conducted in accordance with the MEO principle.










(165)


It should be borne in mind that, where the acquisition of services through the exercise of public authority is concerned, this must in principle be done in compliance with the public procurement rules laid down by secondary EU law. In that case, the fact that such a tender procedure is conducted before a public authority of a Member State makes a purchase of services is normally considered sufficient to rule out the possibility that the Member State is seeking to grant an advantage to the chosen service provider that it would not have otherwise obtained under normal market conditions (97). This is the case, in principle, where a concession for the commercial operation of an airport is granted following a competitive, transparent, non-discriminatory and unconditional tender procedure, in line with the principles of the TFEU on public procurement, provided that the appropriate criteria for selecting the buyer or seller (98) that would have been applied by a private operator in the same circumstances as SMABT have been used.










(166)



Above all, a tender must be competitive to allow all interested and qualified tenderers to participate in the process. The procedure must also be transparent to allow all interested candidates to be equally and duly informed at each stage of the tender procedure. Thirdly, non-discriminatory treatment of all tenderers at all stages of the procedure and objective selection and award criteria specified in advance of the process are indispensable conditions for ensuring that the resulting transaction is in line with market conditions.










(167)


The information provided by France shows that the tender procedure was published in official publications for legal announcements, such as the Official Journal of the European Union, and in a specialised journal. Article 3.3 of the tendering rules (99) specified that the objectives of SMABT were to:






—


increase traffic up to 21 000 commercial movements per year, the maximum set by the noise exposure plan, by 2012;










—


develop the economic benefits in terms of direct and indirect employment linked to the operation of the platform, as well as in terms of tourism and business parks;










—


integrate the management of the airport into an environmental plan, which is currently being devised.














(168)


Article 7 of the tendering rules also specified that the tenders of candidates participating in the invitation to tender for the public service delegation for the operation of the Beauvais airport hub would be evaluated on the basis of the following criteria:






—


the nature and quality of the means implemented to organise and operate the airport (management, human resources, operation of the bus service, sustainable development requirements);










—


the overall organisation involved in operating the airport and the financial relations between SMABT and the successful tenderer; and










—


the quality of the investment programme.














(169)


The Commission notes that the candidates had equal access to various pieces of information and documents comprising, in particular, the draft contract and its detailed annexes, the financial information relating to Oise CCI’s accounts under the concession agreement concluded with the State in 2002 (100), the list of assets made available to the successful tenderer, the existing depreciation tables indicating their status, the airport services contracts in force, the consolidated version of the contract concluded between SMABT and Oise CCI relating to the operation of the bus route and the economic and financial data pertaining to it, as well as the list of staff assigned to the operation of the airport and various extracts from the regulations applicable to the airport (noise exposure plan, environmental assessment, police order, operating regulations, etc.). The company consultation file was submitted in electronic form (CD-Rom) and candidates could ask questions by e-mail before the deadline for the submission of tenders. A data room was also made available to each candidate to physically consult the files on the SMABT premises and an on-site visit to the airport facilities was organised for each candidate.










(170)


The Commission notes that these elements were confirmed by national administrative courts, before which two of the unsuccessful candidates brought two pre-contractual applications for interim relief and which also found that the procedure in question had complied with the reasonable time limits for the submission of applications and tenders (101). More broadly, those courts concluded that the procedure had taken place in a way that complied with the principles of equal treatment in public procurement and transparency. Finally, the Commission notes that the procedure enabled a relatively large number of candidates (five) to submit tenders having knowledge of the selection criteria and the objectives pursued by SMABT.










(171)


The procedure in question was therefore conducted on a competitive, transparent and non-discriminatory basis.










(172)


However, the Commission reiterates that, as regards the criterion relating to the unconditional nature of the invitation to tender, when public bodies buy assets, goods and services, any specific conditions attached to the tender should be non-discriminatory and closely and objectively related to the subject matter and to the specific economic objective of the contract. They should allow for the most economically advantageous offer to match the value of the market. The criteria therefore should be defined in such a way as to allow for an effectively competitive tendering procedure which leaves the successful bidder with a normal return, not more. In practice, this implies the use of tenders which put significant weight on the ‘price’ component of the bid or which are otherwise likely to achieve a competitive outcome (102).










(173)


The Commission notes that the selection criteria for the tenders were neither ranked nor given a score. SMABT did not determine the weighting of each criteria, which gave it a relatively high margin of discretion in the choice of tenders. Thus, while the overall organisation of the contract was indeed one of the criteria taken into account by SMABT, it cannot be said that the tendering rules in principle gave that criterion greater weight than the other criteria. Therefore, the Commission is required to verify whether, in fact, this procedure conferred an economic advantage on SAGEB which it would not have obtained under normal market conditions.










(174)


First of all, the Commission notes that of the five candidates permitted to submit a tender, one of them withdrew during the procedure and two others submitted tenders which did not comply with the financial conditions imposed by SMABT. For example, the public service delegation committee responsible for evaluating tenders found that the GTS consortium had not provided information on projected profit; its self-financing capacity had not been simulated (equity financing capacity had not been anticipated), the simulation of projected and profit-sharing fees had not been communicated and the consortium had not specified how it would finance the investments. Therefore, financial considerations caused SMABT to reject two tenders at the evaluation stage and to start the negotiation procedure with the two remaining tenders.










(175)


The tenders submitted to SMABT by the Vinci Airport consortium on the one hand and the Oise CCI-Veolia consortium on the other were both based on several variants according to the number of traffic movements authorised under the noise exposure plan applying to Beauvais airport. In the course of the negotiations, SMABT thus asked both tenderers to submit tenders based on a benchmark scenario limiting the number of traffic movements to 21 000 for the entire duration of the contract, in order to comply with the noise exposure plan.










(176)


On the financial side, the Vinci Airport consortium submitted a tender with operating fees estimated at EUR 40 million based entirely on operating results, with an investment programme of EUR 70 million without SMABT subsidies. The tender submitted by the Oise CCI-Veolia Transport consortium included a fixed share of operating fees of EUR 10,8 million, plus an additional EUR 5 million in profit sharing and an investment programme of EUR 68,2 million including a grant of EUR 14,5 million.










(177)


According to France, although the tender submitted by the Vinci Airport consortium appeared more attractive on the surface, it was nevertheless based on optimistic and rash assumptions in comparison with the traffic estimates envisaged by the Oise CCI-Veolia consortium, in particular with regard to the limitation of the number of movements imposed by national legislation (noise exposure plan). However, the projected charges of the Vinci Airport consortium were based exclusively on these broad estimates and, unlike the CCIO-Veolia consortium’s tender, did not include a fixed portion; thus, from a financial point of view, the latter’s tender, although lower than that of Vinci Airport, appeared more reasonable and prudent for a cautious investor wishing to safeguard its financial profitability.










(178)


The Commission further notes that the tender submitted by the Oise CCI-Veolia consortium was still profitable for SMABT. The subsidy envisaged by SMABT, net of the portion relating to public-remit investments (see recital 131), was valued at EUR 4,3 million (103), whereas the Oise CCI-Veolia consortium’s tender provided for payment of a minimum fixed portion of EUR 10,8 million to SMABT, guaranteeing a profit margin for SMABT.










(179)


By a decision of 25 February 2008, SMABT awarded the concession contract to the Oise CCI-Veolia consortium, whose tender was 
                                       ‘the most attractive tender in so far as it was best placed to ensure the controlled, environmentally-conscious development of the airport in the light of the general structure of the contract’
                                    . Thus, SMABT complied with the conditions laid down in the tendering rules, which were known in advance to all the candidates taking part in the procedure, as the basis for its choice.










(180)


In the light of the foregoing, the Commission concludes that the tender of the Oise CCI-Veolia consortium selected by SMABT ensured financial profitability for SMABT and therefore did not have the effect of conferring an economic advantage on the CCIO-Veolia consortium (subsequently SAGEB) within the meaning of Article 107(1) TFEU.










(181)


Since the grant of EUR 4,3 million was part of the transaction concluded with the Oise CCI-Veolia consortium (later SAGEB), the Commission concludes that the grant allocated to programme 3 did not constitute State aid within the meaning of Article 107(1) TFEU.





Selectivity







(182)


Where the Commission has identified an advantage, understood in a broad sense, arising directly or indirectly from a particular measure, it is also required to establish that that advantage specifically benefits one or more undertakings. It falls to the Commission to show, in particular, that the measure at issue creates differences between undertakings which, with regard to the objective of the measure, are in a comparable situation. It is necessary therefore that the advantage be granted selectively and that it be liable to place certain undertakings in a more favourable situation than that of others (104).










(183)


The selectivity requirement differs depending on whether the measure in question is envisaged as a general scheme of aid or as individual aid. In the latter case, the identification of the economic advantage is, in principle, sufficient to support a presumption of selectivity (105).










(184)


In the case at hand, the investment grants were all awarded under bilateral agreements negotiated directly with each of the successive operators of the airport in the form of individual aid. These grants were therefore selective in their favour.





Risk of affecting trade between Member States and intra-Union commerce







(185)


In general, when an advantage granted by a Member State strengthens the position of an undertaking compared with other undertakings competing in a given Union market, trade between Member States must be regarded as being affected by that advantage. The Commission notes that airports are in competition for the management of airport infrastructure, including at local and regional airports. The public funding of an airport may therefore distort competition in the markets for airport infrastructure operation.










(186)


In the present case, Beauvais airport competes with other national airports (e.g. Paris-Roissy). The investment aid in question, which had the effect of strengthening its position in relation to that of those other airports, was liable to distort competition. As the market for airport services was open to intra-Union competition, the contributions could also affect trade between Member States.




8.1.1.2.   Operating subsidies


Economic activity







(187)


In the light of the considerations set out in recitals 126 to 128, the Commission concludes that the subsidy of EUR 68 000 granted by the French Civil Aviation Authority to Oise CCI in 2002 related to an activity falling under the public authority remit. As France has demonstrated, that subsidy was granted in order to cover the funding of the one-off measure imposed by the State following the attacks of 11 September 2001, which increased the rate at which passengers’ hand luggage was searched from 25 % to 50 %; as this formed part of a security task falling within the State’s public authority remit, it did not constitute an economic activity (106).










(188)


In addition, that measure was part of an aid scheme intended for all Class 3 provincial airports and was therefore open to all airports in the same category as Beauvais airport at the time it was granted (107). Therefore, this subsidy did not have the effect of giving rise to discrimination.










(189)


The argument put forward by France that part of the advances granted by the general arm of Oise CCI to its airport arm fell within the public authority remit should be accepted. Indeed, before 12 December 2000 — the date of the Court of Justice judgment in Aéroports de Paris — the operation and construction of airport infrastructure could constitute activities falling within the remit of a public authority; accordingly, the Commission cannot call into question, on the basis of Article 107 TFEU, aid granted before that date for the financing or operation of airport infrastructure (108). Therefore, advances granted by the general arm of Oise CCI to its airport arm before 12 December 2000 should not be deemed to constitute aid within the meaning of Article 107(1) TFEU. Nonetheless, the Commission must assess whether the cash advances granted in 2001, 2002 and 2004 do constitute State aid.





Existence of an economic advantage







(190)


To determine whether a State measure constitutes aid to an undertaking, it must be determined whether the undertaking 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. That assessment is made, in principle, by the application of the market economy operator test.





Operating subsidies







(191)


In the first place, the Commission notes that the subsidies of EUR 2 005 and EUR 1 600,10 received by Oise CCI respectively from the national centre for the development of farm structures (in 2005) and the Association for the management of funds for integrating persons with disabilities corresponded to a reimbursement of part of the contributions from Oise CCI overpaid to those two bodies. Consequently, these reimbursements did not cover costs that Oise CCI would normally have had to bear and therefore did not give it an economic advantage.










(192)


As regards the subsidies of EUR 30 490 (2002-2003) and EUR 5 829,49 (2005) paid by the Oise Department and the town of Tillé respectively, the Commission notes, on the basis of the invoices and supporting documents provided by the French authorities, that these subsidies did indeed correspond to remuneration for services provided by the airport arm of Oise CCI on behalf of those two public bodies.










(193)


The Commission notes that, under national legislation, the Oise Department’s tourism promotion remit is the responsibility of that Department (109). The same applies to the connection of pavilions to the collective waste water network, which is the responsibility of the municipalities (110). Consequently, these charges did not constitute normal costs inherent in the management of the airport and were not meant to be borne by Oise CCI.










(194)


In the second place, the Commission notes that the reimbursements did indeed correspond to the expenditure incurred by Oise CCI in providing those services, with the result that Oise CCI was not overcompensated and therefore did not enjoy an economic advantage in receiving those subsidies.










(195)


Since the criterion of economic advantage is not fulfilled in the present case, the Commission considers that the operating subsidies referred to in this subsection and granted to the airport arm of Oise CCI do not constitute State aid within the meaning of Article 107(1) TFEU.





Advances granted by the general arm of Oise CCI to the airport arm







(196)


As mentioned in recital 140, the assessment of the existence of an advantage is in principle carried out by applying the MEO principle. By way of preliminary observation, the Commission notes that France has not invoked this principle. Since the measures in question concern the cash advances granted to CCI Oise’s airport arm in 2001, 2002 and 2004, the Commission will determine whether those advances were granted in accordance with market conditions, in the absence of any doubt as to the intervention of Oise CCI (general arm) in its capacity as an economic operator. As the Oise CCI airport arm was an integral part of the services of Oise CCI, the cash advances could therefore amount to a transaction carried out within the same economic entity and thus constitute, in principle, a transaction which an economic operator in the same situation as the general arm of Oise CCI could adopt in order to assist another subsidiary or branch of the same economic entity. In addition, these cash advances were motivated by economic considerations, since the general arm of Oise CCI intervened to help its airport arm deal with its financial difficulties (see recital 46).










(197)


In the present case, the Commission notes, firstly, that the cash advances were made at zero rate, with no expiry date, even though the airport arm was experiencing a difficult economic period at the time the advances were granted (111). Therefore, the general arm did not have sufficient guarantees for it to expect the airport’s operation to become profitable and allow the airport arm to repay the advances granted while leaving a profit margin big enough to remunerate the capital committed by Oise CCI’s general arm. Moreover, it is not apparent from the information sent to the Commission that a business plan or budgetary simulation was prepared or reconstructed by the airport arm for the general arm with a view to analysing the risk involved in granting those cash advances.










(198)


The Commission therefore concludes in the present case that the MEO principle was not respected and that the advances in question conferred an advantage on the airport arm which it would not have obtained under normal market conditions.





Aid for the tourism development plan







(199)


In the present case, the tourism development plan put in place by SMABT was intended to foster local and regional tourism by encouraging some of the passengers of Beauvais airport to stay in Picardie or the Beauvaisis region instead of travelling to Paris. The plan therefore provided for measures (advertising material at the airport, passenger surveys, websites, SMABT information points, etc.) geared towards the development of tourism in the Picardie, Oise and Beauvaisis regions. Consequently, even if the tourism development plan was based on passengers transiting through Beauvais airport, SAGEB was not the recipient of those actions, since they were aimed primarily at passengers already present at Beauvais airport, i.e. those who had already travelled to Beauvais regardless of the measures of the tourism development plan.










(200)


The Commission notes in the present case that, since the aim was to promote local and regional tourism — a task which in the present case falls to the public authorities by law — the costs associated with that task were not, in principle, to be borne by SAGEB, whose sole task was to operate and manage Beauvais airport. The Commission notes in this regard that the PSD agreement does not impose any obligation on SAGEB to promote local or regional tourism, other than to make a financial contribution to the expenditure associated with these tourism activities and to provide institutional tourism bodies with the necessary resources to enable them to implement these measures (access to the airport, display material, etc.).










(201)


Therefore, the Commission considers that the tourism development plan created by SMABT did not have the effect of alleviating the costs that SAGEB would normally have had to bear.










(202)


Since the criterion of economic advantage is not fulfilled in the present case, the Commission considers that the partial payment by SMABT of expenditure related to the promotion of local tourism development does not constitute State aid within the meaning of Article 107(1) TFEU.





Imputability to the State and transfer of public resources







(203)


According to settled case-law, Article 107(1) TFEU covers all aid granted through State resources without it being necessary to make a distinction whether the aid is granted directly by the State or by public or private bodies established or appointed by it to administer the aid. A measure financed by such a body is therefore imputable to the State where, essentially, the State decides to establish the measure and defines the conditions of use, management or distribution of those resources.










(204)


The cash advances in question were granted in this case by the general arm of Oise CCI. However, the Commission would point out that, in previous decisions, the measures adopted by the chambers of commerce and industry were found to be imputable to the State and to involve State resources (112). In the present case, on the date on which the advances in question were granted, Oise CCI was in a similar situation to that of the other CCIs examined by the Commission. Particularly in view of the applicable law, the decision-making within those entities, the supervision exercised by the state over those entities and the origin of their resources (113), the Commission concludes that the cash advances were imputable to the state and involved the use of State resources.





Selectivity







(205)


The cash advances in this case constituted individual aid (114), which had the effect of favouring the airport arm of Oise CCI to the detriment of other airports. Since the aid was granted directly by the general arm, in a bilateral manner, it is therefore selective in nature (115).





Risk of affecting trade between Member States and intra-EU commerce







(206)


For the reasons set out in recitals 185 and 186, the Commission considers that the cash advances had the effect of affecting intra-EU commerce and trade between Member States.




8.1.1.3.   Conclusion on the existence of aid







(207)


The Commission concludes that all investment grants , with the exception of those referred to in recital 131 and those awarded to SAGEB as described in recitals 131 and 181, constitute State aid within the meaning of Article 107(1) TFEU.










(208)


The Commission also concludes that the cash advances granted by the general arm of Oise CCI to its airport arm in 2001, 2002 and 2004 constitute State aid within the meaning of Article 107(1) TFEU.










(209)


In contrast, the operating subsidies totalling EUR 107 924, the cash advances granted before 12 December 2000 and the partial coverage of the cost of promoting tourism by SMABT do not constitute State aid within the meaning of Article 107(1) TFEU.




8.1.2.   Lawfulness of the aid







(210)


Article 108(3) TFEU states that ‘the Commission shall be informed, in sufficient time to enable it to submit its comments, of any plans to grant or alter aid. The Member State concerned may not put its proposed measures into effect until the procedure has resulted in a final decision’.










(211)


In the present case, the Commission was not informed of any of the measures in question. Therefore, they constitute unlawful aid.




8.1.3.   Compatibility of the aid with the internal market







(212)


The investment and operating aid identified in recitals 207 and 209 and paid to the successive operators of Beauvais airport constitutes State aid within the meaning of Article 107(1) TFEU. Its compatibility with the internal market must be assessed in the light of the exceptions referred to in Article 107(3) TFEU.










(213)


Article 107(3) TFEU provides for certain exemptions from the general rule that State aid is deemed incompatible with the internal market. In particular, the investment and operating aid in question may be assessed on the basis of Article 107(3)(c) TFEU, under which ‘aid intended to facilitate the development of certain activities or of certain economic regions, when it does not affect trading conditions to an extent contrary to the common interest’, can be considered to be compatible with the internal market. The 2014 Aviation Guidelines provide in principle a framework for assessing whether investment and operating aid can be declared compatible with the internal market under Article 107(3)(c) TFEU.










(214)


As regards investment aid, point 173 of the 2014 Guidelines provides that ‘in accordance with the Commission notice on the determination of the applicable rules for the assessment of unlawful State aid, the Commission will apply to unlawful investment aid to airports the rules in force at the time when the aid was granted. Accordingly, it will not apply the principles set out in these guidelines in the case of unlawful investment aid to airlines granted before 4 April 2014’. For investment aid granted before 4 April 2014, the Commission will therefore apply the 2005 Guidelines, which were in force as from 9 December 2005 in accordance with the first paragraph of point 85 thereof. As regards investment aid granted before 9 December 2005, for which there were no specific compatibility criteria, the Commission will assess their compatibility directly on the basis of Article 107(3)(c) TFEU, while also taking into account its decision-making practice. Since this was consolidated by the 2005 Guidelines, investment aid granted before 9 December 2005 should also be assessed in the light of the criteria laid down in the 2005 Guidelines.










(215)


As regards the investment aid granted in 2007, its compatibility will therefore be assessed in accordance with the 2005 Guidelines.










(216)


Where the operating aid is concerned, point 172 of the 2014 Guidelines provides that the principles set out therein apply in all cases involving unlawful operating aid to airports, even if the aid was granted before 4 April 2014 and the beginning of the transitional period. Since the measures in question were not notified before they were granted, they constitute unlawful aid. The Commission will apply the 2014 Guidelines to assess the compatibility of the cash advances.




8.1.3.1.   Investment aid



Applicability of the 2005 guidelines








(217)


Paragraph 53 of the 2005 Guidelines indicates that not all aid granted to finance airports falls within Section 4 of those Guidelines. In particular, aid granted for the pursuit of commercial activities not directly linked to the airport’s core activities must be assessed on the basis of the relevant sectoral and general rules. Moreover, according to paragraph 54, the 2005 Guidelines apply to all airport activities, with the exception of safety, air traffic control and any other activities for which a Member State is responsible as part of its public authority remit.










(218)


The compatibility criteria for investment aid for the financing of airport infrastructure are described in Section 4.1 of the 2005 Guidelines. The only investments eligible for aid under this section are those undertaken for the construction of airport infrastructure and equipment (runways, terminals, aprons, control tower) or facilities that directly support them (fire-fighting facilities, security or safety equipment) (116). Aid related to the provision of airport services ancillary to air transport falls under Section 4.3 of the 2005 Guidelines (subsidies for airport services).










(219)


Under programme 1, the Commission classified all investments made as follows:

Table 11


Type of investment under programme 1 in relation to 2005 Guidelines (in EUR)









 


State-remit investments


Investments falling under Section 4.1


Other investments





West concourse (departures)



 


2 608 000 


 





East concourse (arrivals)



 


164 000 


 





Terminal modernisation



 


649 000 


 





Safety and security equipment



922 000 


 


 





Access roads and utility services


Including car park



 


774 533 


463 467 





Environmental studies and works



 


62 000 


 





Fees
 (117)



55 669 


688 223 


 




Modernisation of operating equipment:






 


Including screening check points






133 000 


1 131 000 


 





Total




1 110 669 




6 076 756 




463 467 















(220)


The Commission thus notes in the context of programme 1 that the amount of public-remit investment comes to EUR 1 110 669; that the investments referred to in Section 4.1 of the 2005 Guidelines are EUR 6 076 756 and other investments (i.e. those related to commercial activities not directly linked to the airport's core activities and not covered by the 2005 Guidelines) amount to EUR 463 467. As noted in recital 37, the public authorities’ contributions (EUR 4,311 million) did not formally cover specific investments under programme 1 but were based on the projected total amount of investments to be made. Therefore, in order to analyse the compatibility of the programme 1 investment aid under the 2005 Guidelines, the costs relating to other investments (EUR 463 000) should be excluded from the eligible costs. However, the Commission notes that after deducting the costs of public-remit investments (EUR 1 110 669) and other investments (EUR 463 467) from the total amount of investments under programme 1, the total amount of subsidies from the public authorities (EUR 4,311 million), net of the subsidy of EUR 1 110 669 awarded to Oise CCI to cover the cost of public-remit tasks (EUR 3,20 million) (118), does not exceed the total amount of investments referred to in Section 4.1 of the 2005 Guidelines (i.e. EUR 6,076 million). Accordingly, it is not necessary to examine the compatibility of the investment aid under programme 1 under legal bases other than those of Section 4.1 of the 2005 Guidelines.










(221)


Under programme 2, the Commission classified the investments made as follows:

Table 12


Type of investment under programme 2 in relation to 2005 Guidelines (in EUR)









 


State


Investments falling under Section 4.1


Other investments




Terminal extension


 


1 327 749 


 




Security fencing


165 805 


 


 




Upgrading of aircraft stands and taxiway


 


1 408 739 


 




Renovation of hangars and runways


 


231 542 


 




Passenger flow separation corridor


176 590 


 


 




Staff car park complying with the Water Act


 


227 611 


 




Car rental base


 


 


1 735 




Land acquisitions ILS


 


61 540 


 




Indoor and outdoor signage


 


10 510 


 




Porte Maillot passenger reception area


 


 


213 548 




Compliance with the Water Act


 


46 141 


 




ILS studies


 


139 803 


 




Modernisation of public access roads


 


1 053 861 


 




Administrative offices


 


944 557 


 




Terminal 2 studies


 


188 188 


 




Fees and contingencies (119)



86 085 


659 038 


 




Modernisation of operating equipment, of which:






—


installation of booths for border police










—


installation of a laser bird repellent













52 670 











86 085 






2 039 000 


 





Total




567 782 




8 338 279 




215 283 















(222)


The Commission thus notes in the context of programme 2 that the amount of public-remit investment comes to EUR 567 782; that the investments referred to in Section 4.1 of the 2005 Guidelines are EUR 8 338 279 and other investments (i.e. those related to commercial activities not directly linked to the airport's core activities and not covered by the 2005 Guidelines) amount to EUR 215 283. As noted in recital 40, the public authorities’ contributions (EUR 6,8 million) did not formally cover specific investments under programme 2 but were based on the projected total amount of investments to be made. Therefore, in order to analyse the compatibility of the programme 2 investment aid under the 2005 Guidelines, the costs relating to other investments (EUR 215 283) should be excluded from the eligible costs. However, the Commission notes that after deducting the costs of public-remit investments (EUR 567 782) and other investments (EUR 215 283) from the total amount of investments under programme 1, the total amount of subsidies from the public authorities (EUR 6,8 million), net of the subsidy of EUR 567 782 awarded to the Oise CCI to cover the costs of public-remit tasks (EUR 6,23 million) (120), does not exceed the total amount of investments referred to in Section 4.1 of the 2005 Guidelines (i.e. EUR 8,3 million). Accordingly, it is not necessary to examine the compatibility of the investment aid under programme 2 under legal bases other than those of Section 4.1 of the 2005 Guidelines.






Compatibility criteria for investment aid








(223)


The compatibility of the investment aid in question must be analysed in the light of the criteria set out in paragraph 61 of the 2005 Guidelines and in the light of the case-law (121). State aid to airports, like any other State aid, must be necessary to facilitate the development of an economic activity and proportionate to that objective in order to be declared compatible with the internal market on the basis of Article 107(3)(c) TFEU. The Commission will therefore assess compliance with these criteria of necessity and proportionality in addition to the aforementioned criteria from the 2005 Guidelines.




—   The aid facilitates the development of an economic activity







(224)


It is clear from the various documents submitted by France that the infrastructure provided for in programme 1 and programme 2 was built with the aim of enabling successive managers to operate Beauvais airport under satisfactory safety conditions for airport users and staff and local residents, and adapted to the significant increase in air traffic recorded by the airport between 2000 and 2010, as indicated in recital 37. This objective was explicitly stated in the financing agreements for these two investment programmes.










(225)


In addition, local and regional authorities have provided financial support to make the Beauvais airport hub a tool for regional economic development. This is clear from the very terms of the financing agreements and the PSD agreement. Local authorities and successive airport managers have stated the objective of making Beauvais airport no longer a transit airport for Paris but an airport contributing to the regional development of the Picardie region.










(226)


Finally, the airport met the objectives of sustainable development and environmental protection. All the investment programmes included studies and work to reduce the environmental stresses caused by air traffic around Beauvais airport. The infrastructure was thus planned and adapted to the need imposed by local authorities to monitor the development of air traffic at Beauvais airport.










(227)


The Commission therefore considers that the aid granted to the successive managers of Beauvais airport was intended to facilitate the development of the Beauvais airport hub by providing it with secure infrastructure capable of accommodating a larger volume of traffic.




—   The infrastructure is necessary and proportionate to the objective pursued


Programme 1







(228)


The Commission takes the view the documents and information provided by France show that, at the time the investment aid was granted, the infrastructure in question appeared to be necessary and proportionate to the objective pursued.










(229)


On the one hand, in the early 2000s Beauvais airport was in a dilapidated state because of the lack of investment undertaken by the State and its manager since it was built. Thus, when the State took the decision to commercially operate Beauvais airport, the airport suffered from a significant lack of infrastructure, in particular as regards safety equipment, the condition of the roads and the airport infrastructure itself. The infrastructure existing at that time was not capable of accommodating national and international passengers under satisfactory safety conditions. All the investments covered by investment programme 1 were therefore necessary in order to ensure the safe operation of Beauvais airport.










(230)


Secondly, the infrastructure built under programme 1 appears to be proportionate in the light of the objective pursued, in so far as it did not go beyond what was necessary to enable Beauvais airport to provide a service complying with the minimum safety requirements. As explained in recital 236, the infrastructure provided for in this investment programme was planned on the basis of conservative forecasts of increased air traffic at Beauvais airport.





Programme 2







(231)


The Commission notes that the same considerations as those set out in recitals 229 and (230) in relation to programme 1 justified the necessity and proportionality of programme 2, which was planned with a view to continuing and completing the safety and modernisation work necessary to accommodate constantly increasing air traffic.










(232)


This is particularly the case for the extension of the terminal: a 2002 report compiled by a firm of architects, a control office and a firm specialising in construction economics noted a significant shortage of surface area at Beauvais airport in view of the traffic forecast for 2010 of 800 000 passengers, but which could remain sustainable if that number was not exceeded and subject to efficient passenger management by the airport. However, as Table 1 shows, in 2006 the airport already had almost two million passengers, justifying the compelling need to expand (122).










(233)


This is also the case for the work on the aircraft parking area, which was intended to increase the depth of the apron, to add taxiway fillets and to apply floor markings in order to better regulate and secure air traffic at Beauvais airport, without this work having led to an increase in the number of aircraft stands available at the airport.










(234)


More generally, all the other infrastructure proved to be necessary to enable the airport to overcome its infrastructure shortage, with the aim of accommodating growing volumes of air traffic and contributing to the economic development of the region.




—   The infrastructure has satisfactory medium-term prospects for use







(235)


The infrastructure was built in order to address reasonable and satisfactory medium-term air traffic growth forecasts.










(236)


Thus, in 2001, Oise CCI proposed programme 1 with a target of 660 000 passengers by 2006, while the airport’s traffic growth index (+18 % per year in 2000) pointed to a higher volume by that date (123). This increase has been placed in the context of the substantial growth in European air traffic, in particular that of low-cost airlines, which at that time had risen dramatically since 1996 (124).










(237)


In addition, programme 2 was based on projected traffic of 18 000 movements over the medium term, according to a report by the French Civil Aviation Authority approved on 29 June 2006.










(238)


The study in Table 1 shows that the traffic projections underpinning these investment decisions were all largely achieved and exceeded ahead of time.




—   All potential users of the infrastructure have access to it in an equal and non-discriminatory manner







(239)


The formal investigation procedure confirmed the observations made in the opening decision that all potential users of the infrastructure had access to it in an equal and non-discriminatory manner.




—   The development of trade is not affected to an extent contrary to the common interest







(240)


France clarified in its comments that the airports of Amiens-Glisy and Rouen are business and leisure airports with no commercial traffic. The development of Beauvais airport therefore had no impact on these two airports, which were not likely to be considered valid alternatives to Beauvais airport. Competition between these airports and Beauvais was therefore very limited and trade was unlikely to be affected to an extent contrary to the common interest.










(241)


Despite the fact that Beauvais airport experienced substantial growth in passenger traffic between 2000 and 2013, from 380 000 to almost 4 million departing passengers, its market share remained very limited in the Paris area (4 % in 2011) compared to Roissy and Orly airports. As regards low-cost traffic, in 2011 Beauvais airport accounted for 31 % of flights from/to Paris, compared to 69 % at Roissy and Orly airports. However, at the same time, according to a Microeconomix study provided by Oise CCI, SMABT and SAGEB (see recitals 106 et seq.), the proportion of low-cost traffic among total traffic at Roissy and Orly airports increased by 5,7 % between 2009 and 2010 and by 11,3 % between 2010 and 2011. Detailed analysis of this study indicates that the development of Beauvais airport, which mainly focuses on low-cost traffic, has not affected the development of the low-cost activity of the two Paris airports because of its characteristics, its market (since unlike the Paris airports it is exclusively geared to the low-cost market) and the absence of large-scale diversion of traffic from Beauvais airport to one of the other two Paris airports.










(242)


Moreover, passenger traffic at Roissy airport amounted to 62 052 917, while Orly airport recorded 28 274 154 passengers in the same year. The Commission has noted that Roissy airport will have to cope with demand exceeding its capacity from 2025. Moreover, as the traffic at Orly airport is capped by an administrative decision (125), it can currently be considered congested. Beauvais airport, by virtue of its proximity to Paris, therefore appears to be an effective means of combating congestion at the two Paris airports.










(243)


Furthermore, the Commission notes that the investment aid received by Beauvais airport was primarily aimed at ensuring the safety of the infrastructure, which had been overloaded by the massive increase in traffic between 2000 and 2010, rather than encouraging the growth of that traffic. In other words, Beauvais airport already enjoyed some success without this investment aid (see recital 224), after a number of low-cost airlines chose to open air routes and potentially establish long-term bases there.










(244)


As regards alternative modes of transport, the formal investigation procedure also failed to establish that their development was affected to an extent contrary to the common interest, as demonstrated by SMABT, Oise CCI and SAGEB in their joint observations (see recital 108).




—   Necessity and proportionality of the aid







(245)


As regards programme 1 in the first instance, the Commission observes that it is clear from the information submitted that Oise CCI would not have been able to finance the planned investments alone. Indeed, the airport arm of Oise CCI made a loss in financial years 2000 and 2001 (see Table 2). Moreover, Oise CCI used borrowing to fund its participation in the financing of the investment programme (126). The aid granted to this investment programme was therefore necessary.










(246)


The Commission also notes that the intensity of the aid from local authorities amounted to 53 % of total eligible costs, which is not disproportionate in view of the immediate investment needs at the time the aid was granted. Moreover, the financing agreements concluded in 2002 each included a mechanism for the recovery of aid in the event that expenditure was not incurred or was lower than the total estimated amount of investment. Similarly, the aid was limited even if the total projected amount was exceeded. The financing agreements also put in place checks on the expenditure incurred by the local authorities, the subsidies being allocated in instalments on the basis of the supporting documents produced by Oise CCI. The aid granted to this investment programme was therefore necessary and proportionate.










(247)


Secondly, as regards the investment aid granted to Oise CCI under programme 2, the Commission took note of the compelling need to undertake the investments concerned and of the very limited amortisation period of these investments for Oise CCI (127). It therefore considers that the aid was necessary and proportionate in view of the specific circumstances existing at the time the aid was granted.










(248)


The Commission therefore concludes that all the investment aid granted in this case was necessary and proportionate.






Conclusion on compatibility of investment aid








(249)


The Commission concludes that the investment aid referred to in this section complies with Article 107(3)(c) TFEU as interpreted by the 2005 Guidelines.




8.1.3.2.   Operating aid







(250)


Point 137 of the 2014 Guidelines provides that operating aid granted before the beginning of the transition period (including that paid before 4 April 2014) may be declared compatible with the internal market for all operating costs which are not covered, provided that the conditions set out in Section 5.1.2 are satisfied, with the exception of points 115, 119, 121, 122, 123, 126 to 130, 132, 133 and 134 of the 2014 Guidelines.










(251)


The conditions set out in Section 5.1.2 of the 2014 guidelines are analysed below.




—   The aid facilitates the development of an economic activity







(252)


The purpose of the zero-rate cash advances granted in 2001, 2002 and 2004 was to enable Oise CCI’s airport arm to maintain its Beauvais airport management activity with a view to making it a tool to foster the economic growth of the Picardie region. Consequently, the aid was intended to facilitate the regional development of Beauvais’ airport activity. Moreover, the Commission notes that Beauvais airport serves a useful purpose for the Paris region in contributing to the decongestion of air traffic around the French capital.




—   Need for State intervention







(253)


Pursuant to point 118 of the 2014 Guidelines, the Commission observes that, on the basis of the actual annual passenger traffic recorded in the two financial years preceding each of those in which the cash advances were granted (i.e. in 2001, 2002 and 2004), Beauvais airport could be considered at the time each portion of the operating aid was granted as an airport not being able to cover those costs to a fairly substantial extent (128).










(254)


The 2014 Guidelines also require the aid to bring about a significant improvement that the market itself cannot deliver. The Commission considers this to be the case here. The critical economic situation in which Beauvais airport found itself at the time each of the cash advances was granted (marked by persistently low traffic, a compelling need for secure infrastructure and a financial balance showing a loss) (129) could make it difficult for the airport arm to access the market at reasonable borrowing rates (130). Since these difficulties were such as to deprive the Picardie region of a secure airport infrastructure favourable to its economic development, the cash advances were therefore necessary to prevent Beauvais airport from facing default.




—   Appropriateness of State aid as a policy instrument







(255)


Since the financial results of Oise CCI’s airport arm showed a loss at the time the aid was granted (131) and it faced a cash flow shortfall, the cash advances enabled it to continue its Beauvais airport management activity with a view to making it a tool to foster regional economic growth and securing the infrastructure. The Commission notes that these advances were also time-limited and are the least distortive instrument for the market as they were intended to address a temporary need for liquidity. Therefore, the aid was an appropriate instrument to achieve the objectives of common interest.




—   Existence of incentive effect







(256)


The Commission notes that in the absence of these cash advances, the activities of Oise CCI as airport manager would have been considerably reduced (if not stopped due to a risk of default) even though Beauvais’ airport infrastructure experienced strong growth in the early 2000s. Such a situation would have significantly undermined the pursuit of the objective of general interest described in recital 252. The aid therefore undoubtedly had an incentive effect.




—   Proportionality of the aid amount (limiting aid to the minimum needed)







(257)


According to point 125 of the 2014 Guidelines, in order to be proportionate, operating aid to airports must be limited to the minimum necessary for the aided activity to take place. In the present case, the Commission considers that the cash advances were proportionate in that they enabled Beauvais airport to meet its immediate payment deadlines. The Commission further notes that these advances were of small amounts, which meant that the aid was limited to what was necessary to meet the one-off liquidity needs. The Commission also notes that they were quickly reimbursed by Oise CCI’s airport arm from 2005. Therefore, the cash advances were limited to the strict minimum necessary.




—   Avoidance of undue negative effects on competition and trade







(258)


Finally, and as indicated in recitals 240 et seq., although other airports were present in the catchment area of Beauvais airport, some of them did not operate commercial traffic. Moreover, the small amount of operating aid granted in this case could not have had any negative effects on the development of the other two Paris airports (Roissy and Orly) whose size and volume of traffic were not comparable to those of Beauvais airport. In addition, the airport infrastructure was made available to all airlines on non-discriminatory terms.




—   Conclusion







(259)


On this basis, the Commission concludes that the compatibility conditions laid down in the 2014 Guidelines have been met and, consequently, that the cash advances granted at a zero rate by the general arm of Oise CCI to its airport arm constituted State aid compatible with the internal market pursuant to Article 107(3)(c), as interpreted by the 2014 Guidelines.




8.2.   Measures in favour of airlines







(260)


As indicated in recital 125, in order to qualify as State aid, a measure in favour of an airline must fulfil several cumulative conditions. In particular, it must confer an economic advantage on the airline. The Commission concluded that the measures at issue in favour of the airlines did not confer an economic advantage on them for the reasons set out in Section 8.2.1. Therefore, this section merely demonstrates the absence of an economic advantage, there being no need to examine the other criteria for the existence of State aid.




8.2.1.   No economic advantage







(261)


In order to determine whether the agreements concluded with the airlines by Oise CCI and SAGEB confer an advantage on those airlines, the Commission must examine whether in similar circumstances a private operator, having regard to the foreseeability of obtaining a return and leaving aside all social, regional-policy and sectoral considerations, and operating under normal market economy conditions, would have entered into commercial agreements similar or identical to those concluded by the operator of Beauvais airport (Oise CCI, followed by SAGEB). Public funding granted in circumstances which correspond to normal market conditions is not regarded as State aid.










(262)


Consequently, with regard to the public financing of airports, the MEOP compliance analysis — about the applicability of which there is little doubt in the present case since these are agreements of a commercial nature which an airport is often called upon to conclude in the course of its commercial activity — must be based on satisfactory ex ante profitability prospects for the body granting the financing. Any traffic forecasts used for that purpose should be realistic and subject to a reasonable sensitivity analysis. The absence of a business plan is an indication that the MEO principle may not have been respected (132). In the absence of a business plan, Member States can provide analysis or internal documents from the public authorities or from the airport concerned showing clearly that an analysis conducted before the granting




8.2.1.1.   Reconstruction of business plans – Oise CCI & SAGEB







(263)


The Commission considers that the transactions referred to in the previous recital are in line with market conditions on the basis of a reconstruction of the business plans that a market economy operator would have drawn up to decide whether or not to sign the contracts with the airlines (133).










(264)


As indicated in Section 5.2, for the contracts signed by Oise CCI referred to in Table 9 (with the exception of the RYAN1 and RYAN2 contracts), France submitted analyses carried out a posteriori, but simulating the knowledge and reasonable assumptions that the airport manager would have had and made before signing the contracts. For the contracts signed by SAGEB, France provided the business plans drawn up prior to the signing of the contracts, and reconstructed those plans to calculate their incremental contribution to the airport operator’s profits.










(265)


The Commission notes that several assumptions made in both the ex ante and ex post analyses are insufficiently substantiated by France. In particular, the assumptions concerning the incremental costs of the airport operator are not supported by a detailed analysis. Other assumptions, such as the aircraft load factor and aeronautical/non-aeronautical revenues, are not firmly substantiated in some analyses.










(266)


In so far as those assumptions constitute basic parameters of the financial projections, the Commission chose to determine the assumptions that would have been used by an airport operator operating under normal market economy conditions. The Commission also chose to reconstruct the business plans as they would have been drawn up, on the basis of these assumptions, by an airport operator operating under normal market economy conditions before choosing whether or not to sign the contracts with the airlines. If the reconstruction of a business plan shows that the signing of a contract makes it possible to generate an incremental profit for the airport operator, the latter acts as a MEO by signing the contract.




8.2.1.2.   Reconstruction of business plans by the Commission – assumptions used







(267)


The contracts referred to in Table 9 each have very specific characteristics (see Table 10). For each of the contracts, the Commission reconstructed a business plan taking into account assumptions for passenger numbers, aircraft load factors, revenues and costs. These reconstructions make it possible to determine the incremental profit (or incremental loss) that the airport manager could expect by signing the contract. The following assumptions were applied:





Number of passengers (traffic)







(268)


Some contracts are based on passenger traffic commitments (e.g. the RYAN4 contract is based on the commitment to make at least 10 weekly turnarounds in addition to those already operated). Other contracts refer to the traffic projected by the airline, without this constituting a firm commitment. Finally, some contracts do not refer to any traffic targets.










(269)


Where the contracts contain a traffic commitment, the Commission applied that volume of traffic. Where reference is made to a particular volume of traffic, without implying any commitment on the part of the airline, the Commission applied that volume and carried out sensitivity analyses to check if a higher or lower volume would lead to the same conclusion, i.e. whether the contract in question generates a profit or a loss for the airport operator. Where no volume is referred to, the Commission carried out several traffic analyses to ensure that there is no change in the conclusions on the profitability of the contract depending on the number of flights applied. This analysis is particularly important where the airport operator’s revenues vary according to the number of flights. For example, for the WIZZ1 contract, landing fee revenues decrease by 20 % per turnaround where there are more than four turnarounds per day. It is therefore necessary to ensure that if the number of daily turnarounds exceeds four, the contract remains profitable.





Aircraft capacity and load factor







(270)


The type of aircraft used by an airline (and thus its capacity) is sometimes mentioned in the contract. In this case, the capacity of this type of aircraft is used. Where the type of aircraft used is not mentioned in the contract, the Commission relied on the information provided by France. Aircraft capacity varies between 132 and 198 seats.










(271)


The load factor used by the Commission is that observed in the years preceding the signature of the contract. For Ryanair and Wizz Air, the specific load factors of the flights operated by those airlines in the years preceding the signature of the contract were used. For the other airlines, for which the airport manager does not have historical data, the average historical data of the airport (all airlines) were used. Load factors vary between 70 % and 80 %.





Aeronautical revenues







(272)


Aeronautical revenues are based on the terms of the contracts. They include the revenue from landing fees and fees due for each departing passenger. In many contracts, landing fees are degressive (their rate decreases according to the number of weekly or daily turnarounds) and many contracts do not include passenger fees. The Commission assumed that, for the multi-year contracts, the landing and passenger fees remained fixed for the duration of the contract, since the contracts did not include any rate increase clause.





Non-aeronautical revenues







(273)


Non-aeronautical revenues constitute the majority of Beauvais airport’s revenues and those from the bus connection between Paris and the airport represent the main revenue item within that category. In 2009, revenues from the operation of the bus route constituted 49 % of the airport’s revenues and other non-aeronautical revenues accounted for 16 % (aeronautical revenues accounted for 12 % and the security charge 23 %).










(274)


The Commission based the estimate of the revenues from the operation of the bus route on (i) the rates in force at the time the contracts were signed (134) and (ii) the proportion of passengers using the bus in the year preceding the signing of the contract (this proportion stood at [55-60] % between 1997 and 2005 and stabilised at around 50 % between 2006 and 2011). The Commission assumed that, for the multi-year contracts, bus fares increased by 2 % per year due to inflation. For the reconstruction of the RYAN3 business plan, over a period of 10 years, the Commission also applied an annual decrease of one percentage point in the proportion of passengers using the bus (from 57 % to 48 % in 10 years) to take into account the growth in airport parking activities and the expected growth in the number of local passengers and those coming from the north of the region.










(275)


The estimate of other non-aeronautical revenues (parking, shops, etc.) is based on an analysis of the airport operator’s profit and loss accounts. They amount to approximately EUR 1,50 per passenger in 2000-2001 and EUR 2,20 per passenger in 2008-2009. The Commission assumed that, for the multi-year contracts, other non-aeronautical revenues increased by 2 % per year due to inflation.










(276)


The non-aeronautical revenues referred to in recitals 274 and 275 are taken into account in all of the business plan reconstructions. Other types of non-aeronautical revenues were also taken into account on an ad hoc basis in order to reflect certain specific agreements. However, their impact remains negligible:






(a)


for the RYAN1, RYAN2 and RYAN3 contracts, the Commission took into account the agreement with Ryanair under which the airport operator receives a commission of 5 % of the value of the Ryanair air tickets it sells directly. France estimated this revenue at EUR 0,15 per passenger on the basis of revenues of EUR 100 000 in 2002;










(b)


for contracts which include optional provisions relating to aircraft cleaning and other services, the Commission assumed that airlines would use these services in 5 % of cases.









Incremental airport operating costs







(277)


The incremental operating costs of the airport are the main cost item of the business plans. They include all of the airport’s operating costs (staff, equipment, etc.), but do not include investments made in the airport, or costs related to the State’s exercise of its powers as a public authority.










(278)


With regard to incremental investment costs, it should be noted that, according to France, no investment needed to be made at Beauvais airport due to a specific contract covered by this investigation. As a result, and given that there is nothing to indicate that a market economy operator would have expected to have to make certain investments due to one or more of the contracts covered by the formal investigation procedure, no incremental investment cost has been taken into account in this analysis.










(279)


Incremental operating costs cover operating costs relating to both aeronautical and non-aeronautical operations (buses and other non-aeronautical operations).










(280)


Incremental operating costs do not include costs related to public authority obligations (safety and security), which are covered by the State (and do not constitute State aid within the meaning of Article 107(1) TFEU).










(281)


In order to reconstruct the operating costs, the Commission used the information contained in the profit and loss accounts of Oise CCI and SAGEB. Annual operating costs consist of total operating charges less (i) operating costs linked to the exercise of public-authority powers (safety and security – these costs are financed by the security charge) and (ii) amortisation of investments (consisting of depreciation and amortisation expenses and provisions for renewal and major repairs).










(282)


By analysing the change in operating costs according to the number of passengers, it is possible to calculate the incremental operating cost per passenger, i.e. the additional operating cost generated by the arrival of an additional passenger. Graph 1 and Graph 2 show that the change in the number of passengers and operating costs are closely correlated.










(283)


The Commission identified two periods for which the growth in operating costs shows different characteristics. On the one hand, between 1997 and 2001, the incremental operating cost amounted to EUR 6,54 per passenger at 2001 values. For contracts signed before 31 December 2001, the Commission based incremental operating costs on this figure. The value used to reconstruct a business plan is adjusted for inflation. Thus, for the RYAN1 business plan signed in 1999, the Commission used an incremental operating cost of EUR 6,35, corresponding to the value of EUR 6,54 adjusted for inflation between 1999 and 2001. The result of the Commission’s analysis is shown in Graph 1.

Graph 1


Operating costs according to number of passengers (1997-2001)







Source: Beauvais airport data. Commission analysis










(284)


Graph 1 was established using the following method:






(1)


Each dot on the graph corresponds to a year between 1997 and 2001;










(2)


For each dot, the x-axis is the number of passengers carried in the year, and the y-axis represents the total operating costs of the airport in the year;










(3)


The equation line y=6,5405x +152944 is extrapolated from all dots. The correlation between the extrapolated straight line and the dots is very high, with an R2 of 0,9105, which means that the extrapolated straight line is an excellent approximation to model the alignment of the dots and makes it possible to determine a linear relationship between the airport’s operating costs and the number of passengers carried. The extrapolated straight line equation can thus be used to define the amount of operating costs (y) according to the number of passengers carried (x);










(4)


For every additional passenger carried, the additional operating costs are thus EUR 6,5405.














(285)


On the other hand, between 2002 and 2009, the incremental operating cost amounted to EUR 8,47 per passenger at 2009 values. For the contracts signed between 2002 and 2010, the Commission based the incremental operating costs on this figure, assuming that in 2010, a reasonable operator would rely on known operating costs up to 2009. The value used to reconstruct a business plan is adjusted for inflation. Thus, for the FLYM1 business plan signed in 2006, the Commission applied an incremental operating cost of EUR 8,05, corresponding to the value of EUR 8,47 adjusted for inflation between 2006 and 2009. The result of the Commission’s analysis is shown in Graph 2.

Graph 2


Operating costs according to number of passengers (2002-2009)







Source: Beauvais airport data. Commission analysis










(286)


Graph 2 was established using the following method:






(1)


Each dot on the graph corresponds to a year between 2002 and 2009;










(2)


For each dot, the x-axis is the number of passengers carried in the year, and the y-axis represents the total operating costs of the airport in the year;










(3)


The equation line y=8,4719x +1E+06 is extrapolated from all the dots. The correlation between the extrapolated straight line and the dots is very high, with an R2 of 0,9271, which means that the extrapolated straight line is an excellent approximation to model the alignment of the dots and makes it possible to determine a linear relationship between the airport’s operating costs and the number of passengers carried. The extrapolated straight line equation can thus be used to define the amount of operating costs (y) according to the number of passengers carried (x);










(4)


For every additional passenger carried, the additional operating costs are thus EUR 8,4719.














(287)


The Commission assumed that, for the multi-year contracts, incremental operating costs are determined for the first year of the contract according to the methodology described in recitals 285 and 286, and that the costs then increase by 2 % per year due to inflation.





Marketing costs – incentive schemes







(288)


The RYAN4, RYAN5, WIZZ1, WIZZ2, WIZZ3, VOLA1, AIRH1 and CENT1 contracts contain clauses according to which the airport operator undertakes to pay the airline financial contributions based on the traffic it generates. This financing constitutes costs for the airport manager and is taken into account in the business plans reconstructed by the Commission. The other contracts do not include such clauses.




8.2.1.3.   Reconstruction of business plans by the Commission – results







(289)


For all the contracts signed by Oise CCI and SAGEB which are the subject of this decision, the business plans reconstructed by the Commission generate incremental profits for the airport manager, confirming France’s conclusions that the contracts signed by Oise CCI and SAGEB would have been signed by an airport operator operating under normal market economy conditions.










(290)


Therefore, the contracts signed by Oise CCI and SAGEB with the airlines did not confer any advantages on the airlines within the meaning of Article 107(1) TFEU and thus do not constitute State aid.




8.2.1.4.   SAGEB shareholders’ agreement – influence of the private shareholder







(291)


In addition to the analysis set out in Section 8.2.1.3, the Commission considers in the alternative that the decisions to sign airport services contracts between SAGEB and the airlines are in line with market conditions in that they have been validated jointly by the two shareholders of SAGEB (Oise CCI as a public entity and Véolia Transport as a private operator), which are equally exposed to the profits and risks resulting from those transactions. SAGEB signed the RYAN4, RYAN5 and WIZZ3 contracts (see recital 51).










(292)


The Commission Notice on the notion of State aid as referred to in Article 107(1) TFEU states that the compliance of a transaction with market conditions can be directly established where the transaction is carried out pari passu by public entities and private operators (135).










(293)


In the present case, the Commission must analyse the conduct of SAGEB (the airport operator) and not the joint conduct of SAGEB and other public or private operators. The Commission thus analysed the decision-making process within SAGEB concerning the signing of contracts with airlines and the respective roles of SAGEB’s shareholders (Oise CCI with 51 % and Véolia Transport with 49 %).










(294)


The role and powers of Oise CCI and Véolia Transport within SAGEB are governed by SAGEB’s articles of association and by the shareholders’ agreement signed by Oise CCI and Véolia Transport.










(295)


Within SAGEB, a Partners’ Committee is made up of ten shareholders’ representatives. Each shareholder appoints a number of representatives in proportion to its shareholding (rounded to the nearest whole number) (136). Therefore, five representatives are appointed by Oise CCI and five by Véolia Transport.










(296)


The chair of SAGEB (who serves as the director of the airport) and the vice-chair (who replaces the chair if the latter is unable to perform his/her duties) are appointed by a qualified majority of the Partners’ Committee (75 % of shareholders’ votes), on a proposal from the majority shareholder for the chair and on a proposal from Véolia Transport for the vice-chair (137). Both Oise CCI and Véolia Transport have a blocking minority for these two appointments, which must therefore be agreed by consensus between the two shareholders. The chair and vice-chair are both members of the Partners’ Committee. The appointments of the operations director (proposed by Véolia Transport), the director of technical services and the accounting and finance director are all approved by the Partners’ Committee by qualified majority (138). For all key functions involved in the operation of the airport, Oise CCI and Véolia Transport thus have a blocking minority, and decisions must be taken by consensus between the two shareholders.










(297)


Decisions on the signing of contracts with airlines are subject to approval by the Partners’ Committee, by qualified majority (139). In particular, this concerns the following decisions:






(a)


adoption and approval of the annual budget;










(b)


approval of updates to the business plan;










(c)


any act, contract or agreement of more than one year or requiring SAGEB to incur a sum of more than EUR 100 000 and which is not provided for in the annual budget;










(d)


any decision that may affect SAGEB’s turnover in an amount exceeding EUR 100 000 (as is the case for the RYAN4, RYAN5 and WIZZ3 contracts);










(e)


any act, commitment or decision which may affect more than 4 % of the total number of air movements within the airport (this is the case for the RYAN5 and WIZZ3 contracts, which affect 5,3 % and 113 % of traffic respectively).














(298)


Decisions on the signing of contracts with airlines are taken under the same conditions by the two shareholders, who are in a comparable situation. In coming to this conclusion, the Commission notes in particular that:






(a)


decisions on the signing of contracts with airlines, and in particular with regard to the RYAN4, RYAN5 and WIZZ3 contracts, are taken jointly by both shareholders and require the approval of each;










(b)


both shareholders are exposed to the risks and profits of operating the airport according to the same terms and in proportion to their shareholding in SAGEB, i.e. 51 % for Oise CCI and 49 % for Véolia Transport;










(c)


the participation of Véolia Transport is therefore of real economic importance (140) and, given the shareholders’ agreement, its decisions carry as much weight as those of Oise CCI;










(d)


the positions of Oise CCI and Véolia Transport are comparable with regard to operation of the airport. Although Oise CCI was the operator of Beauvais airport before SAGEB, its exposure to the results of the airport is limited to its role in SAGEB, and is in no way related to its role as the operator preceding SAGEB. The delegation contract between SMABT and SAGEB thus makes no mention of any obligations on the part of Oise CCI linked to its management of the airport before 1 June 2008 (the date on which SAGEB began operating the airport).














(299)


The Commission concludes that (i) the contracts with the airlines were signed pari passu by Oise CCI and Véolia Transport; (ii) because of the existence of a shareholders’ agreement with Oise CCI, Véolia Transport is in a position to ensure that contracts signed by SAGEB with airlines are in line with its interests; and (iii) these transactions were carried out by a private operator in a market economy and are thus in line with market conditions.










(300)


In support of this conclusion, the Commission also notes that SAGEB carried out economic analyses prior to the signing of the RYAN4, RYAN5 and WIZZ3 contracts to ensure the profitability of these contracts, and that these analyses were approved by the Partners’ Committee. The Commission also notes in further support of its conclusion that SAGEB made a profit from the operation of the airport from 2008 to 2011, illustrating the sound management of SAGEB.










(301)


In conclusion, the analysis of SAGEB’s articles of association and its shareholders’ agreement serve to confirm the conclusion set out in recital 290, namely that the contracts signed by SAGEB with the airlines do not confer advantages on those airlines within the meaning of Article 107(1) TFEU and therefore do not constitute State aid.




8.2.2.   Conclusion on the existence of State aid







(302)


The Commission concludes that the airport services contracts concluded by Oise CCI and SAGEB listed in Table 9 did not confer an economic advantage on the airlines as they were concluded in accordance with the MEO principle.










(303)


Therefore, the airport services contracts do not constitute State aid within the meaning of Article 107(1) TFEU,




HAS ADOPTED THIS DECISION:



Article 1

1.   The investment grants awarded by the Oise department, the Beauvaisis intermunicipal authority and the Region of Picardie to the Oise Chamber of Commerce and Industry in 2001 in the amount of EUR 1 110 669 and in 2006 in the amount of EUR 567 782, to cover the costs associated with the public-remit tasks of Beauvais airport, as well as the investment grants awarded to the Société Aéroportuaire de Gestion et d'Exploitation de Beauvais (Beauvais airport managing and operating company, SAGEB) by the Syndicat mixte de l’aéroport de Beauvais-Tillé in 2008, amounting to EUR 14,5 million, do not constitute State aid within the meaning of Article 107(1) of the Treaty on the Functioning of the European Union.


2.   The investment grants awarded by the Oise department, the Beauvaisis intermunicipal authority and the Region of Picardie to the Oise Chamber of Commerce and Industry in 2001 in the amount of EUR 3,20 million and in 2006 in the amount of EUR 6,23 million constitute State aid within the meaning of Article 107(1) of the Treaty on the Functioning of the European Union. This State aid was unlawfully granted by France in breach of Article 108(3) of the Treaty on the Functioning of the European Union.


3.   The operating subsidies granted to the Oise Chamber of Commerce and Industry, as well as the cash advances granted by the general arm of the Oise Chamber of Commerce and Industry to its airport arm before 12 December 2000, do not constitute State aid within the meaning of Article 107(1) of the Treaty on the Functioning of the European Union.


4.   The cash advances granted by the general arm of the Oise Chamber of Commerce and Industry to its airport arm from 2001 to 2004 constitute State aid within the meaning of Article 107(1) of the Treaty on the Functioning of the European Union. This State aid was unlawfully granted by France in breach of Article 108(3) of the Treaty on the Functioning of the European Union.


5.   The partial coverage by the Syndicat mixte de l’aéroport de Beauvais-Tillé of the expenditure relating to the implementation of a tourism development plan does not constitute State aid within the meaning of Article 107(1) of the Treaty on the Functioning of the European Union.


6.   The State aid referred to in paragraphs 2 and 4 is compatible with the internal market on the basis of Article 107(3)(c) of the Treaty on the Functioning of the European Union.



Article 2

1.   The airport services contracts concluded between the Oise Chamber of Commerce and Industry and Ryanair on 8 September 1998, 16 March 2001 and 12 February 2002 respectively, as well as the airport services contracts concluded by the Société Aéroportuaire de Gestion et d'Exploitation de Beauvais (Beauvais airport managing and operating company, SAGEB) with Ryanair on 4 February 2010 and 27 July 2010, do not constitute State aid within the meaning of Article 107(1) of the Treaty on the Functioning of the European Union.


2.   The airport services contracts concluded between the Oise Chamber of Commerce and Industry and Wizz Air on 11 June 2004 and 1 July 2005 respectively, as well as the airport services contracts concluded between the Société Aéroportuaire de Gestion et d'Exploitation de Beauvais (Beauvais airport managing and operating company, SAGEB) and Wizz Air on 1 June 2009, do not constitute State aid within the meaning of Article 107(1) of the Treaty on the Functioning of the European Union.


3.   The airport services contracts concluded by the Oise Chamber of Commerce and Industry with Goodjet on 14 December 2001, Ciaofly on 24 April 2002, Berlin Jet on 30 January 2003, Volare on 13 February 2003, Sterling on 15 July 2004, Norwegian Air Shuttle on 7 April 2005, Air Horizon on 12 July 2004, Air Polonia on 20 October 2004, Blue Air on 11 October 2005, FlyMe on 30 March 2006 and Centralwings on 18 February 2007 do not constitute State aid within the meaning of Article 107(1) of the Treaty on the Functioning of the European Union.



Article 3
This Decision is addressed to the French Republic.




Done at Brussels, 26 July 2022.


For the Commission

Margrethe VESTAGER
            

Member of the Commission






(1)  
            OJ C 279, 14.9.2012, p. 23.

(2)  Report on the final findings on the management of the Oise Chamber of Commerce and Industry, available at http://www.ccomptes.fr/fr/CRC20/documents/ROD/PIR200714.pdf

(3)  
            OJ C 279, 14.9.2012, p. 23.

(4)  By letters of 30 May 2012, 15 June 2012, 3 May 2013, 9 January 2014, 23 January 2014, 4 February 2014, 2 July 2014, 12 September 2014, 16 December 2015 and 17 May 2019.

(5)  Commission Decision (EU) 2016/1698 of 20 February 2014 concerning measures SA.22932 (2011/C) (ex NN 37/2007) implemented by France in favour of Marseille Provence Airport and airlines using the airport (OJ L 260, 27.9.2016, p. 1).

(6)  Communication from the Commission – Guidelines on State aid to airports and airlines (OJ C 99, 4.4.2014, p. 3).

(7)  
            OJ C 113, 15.4.2014, p. 30.

(8)  According to annexes to the letter from the French authorities of 31 January 2012.

(9)  Budgetary oversight is designed to ensure compliance with the rules in force on preparing, adopting and implementing the budgets of local authorities and the bodies they set up. It is the exclusive responsibility of the prefect, in accordance with Articles L.1612-1 to L1612-20 CGCT and Article 72 of the French Constitution, in collaboration with the regional courts of auditors. Only prefects may modify budgetary documents by virtue of their power to act in place of the local authority (‘
            pouvoir de substitution
            ’), by which they can adopt and promulgate a budget on their own initiative. Budgetary oversight covers the date of adoption of the budget, real balance, the adoption of the accounts and administrative account deficit, and the entry and authorising of statutory expenditure.

(10)  Article 58 of the Amending Budget Law for 2006 of 30 December 2006.

(11)  Data from the French authorities, 31 January 2012. The Paris-Beauvais bus service started in May 1997. According to France, the drop in net income in 2004 is due to the very high volume of the provisions for renovation of fixed assets under concession (EUR 5 216 500) and the provision for major repairs (EUR 590 000). The renovation programme covered in particular the renovation of the main runway, aircraft stands and taxiways, access roads and the heating, electricity and plumbing installations.

(12)  
            1 January 2008 to 31 May 2008.

(13)  Decision by SMABT, 25 February 2008.

(14)  A more detailed description of the delegation procedure is provided in recitals 159 et seq.

(15)  In 2008 Veolia Environnement’s capital was divided between the following: Caisse des dépôts et consignations (public-sector institution) (10 %), Groupama (5,55 %), Capital Research and Management Company (5,04 %), EDF (3,87 %), Veolia Environnement (3,17 %), and individuals and other private investors in the form of shares (72,37 %) (https://www.veolia.com/sites/g/files/dvc2491/files/imported-documents/2016/11/Rapport_financier_annuel_-_Document_de_reference_2008_20090406_0.pdf).

(16)  Articles 1 and 6 of the Order of 1 October 1997 granting the temporary authorisation to occupy the public domain.

(17)  Article 8 of the AOT refers to air traffic control services and meteorological services for air navigation.

(18)  Article 9 of the AOT.

(19)  Article 34 of the AOT.

(20)  Article 10 of the AOT.

(21)  See Decree No 97-547 of 29 May 1997 approving the standard specification and the concession agreement for concessions granted by the State for the construction, maintenance and operation of aerodromes, as amended by Decree No 99-780 of 6 September 1999.

(22)  Under Article 16 of the specification (to which Article 7 of the 2002 concession agreement refers), these services also included the purchase, maintenance and installation of equipment necessary for the provision of air traffic services, including the lighting control system, the purchase of radio landing aids and the purchase and installation of any visual approach slope indicators.

(23)  Article 7.2 of the concession agreement.

(24)  Articles 8 and 9 of the concession agreement.

(25)  Articles 11 and 13 of the concession agreement.

(26)  Articles 8 and 9 of the concession agreement.

(27)  Article 1 of the PSD agreement of 19 March 2008. The bus service was in fact operated exclusively by SAGEB.

(28)  Articles 6 and 7 of the PSD agreement of 19 March 2008.

(29)  Under Article 27 of the PSD agreement, these services are principally safety and fire services, animal hazard prevention, security checks on access to restricted areas of the aerodrome, tasks related to carrying out security inspections, etc.

(30)  In respect of the tasks of providing safety and fire services and animal hazard prevention.

(31)  In respect of all other safety and security-related services referred to in Article 27 of the PSD agreement.

(32)  Article 9 of the PSD agreement. The investments concerned are listed further on in the Decision.

(33)  Articles 11 and 79 of the PSD agreement.

(34)  By funding agreement concluded between the Department of Oise and Oise CCI on 23 July 2002.

(35)  By funding agreement concluded between the Region of Picardie and Oise CCI on 13 December 2002.

(36)  By funding agreement concluded between the Beauvaisis intermunicipal authority and Oise CCI on 8 October 2002.

(37)  The Department of Oise and the Region of Picardie each contributed EUR 2 060 000 and the Beauvaisis intermunicipal authority EUR 191 395.

(38)  Oise CCI planned to finance its share by self-financing (airport service) and borrowing.

(39)  Preamble to amendment 1 of 10 August 2005 to the funding agreement of 23 July 2002.

(40)  The investment timetable contains three financing periods: a period running from 1 June 2008 to 31 December 2012 with a commitment of EUR 49,9 million; a second period running from 1 January 2013 to 31 December 2017 with a planned investment of EUR 7,8 million; and a final period between 2018 and 2023 involving EUR 10,5 million in investments.

(41)  The tourism development plan had been adopted previously by SMABT on 24 January 2008. It was attached to the PSD agreement.

(42)  See Article 8 of the Agreement on objectives and means of 24 October 2008.

(43)  Judgment of the Court of 24 July 2003, Altmark Trans GmbH and Regierungspräsidium Magdeburg, C-280/00, ECLI:EU:C:2003:415.

(44)  Comments by France of 14 August 2012.

(45)  Comments by France of 14 August 2012.

(46)  See Table 4. More specifically, France indicated in its comments that these amounts came to EUR 920 425. In reality, after close examination by the Commission of the invoices supplied by France, the expenditure on the items concerned was higher than indicated by France.

(47)  Community guidelines on financing of airports and start-up aid to airlines departing from regional airports (OJ C 312, 9.12.2005, p. 1).

(48)  Judgment of the Court of First Instance of 12 December 2000, Aéroports de Paris v Commission, T-128/98, ECLI:EU:T:2000:290.

(49)  Roissy airport is 80 km from Beauvais airport and Orly, 115 km.

(50)  According to the study (based on data from the French Civil Aviation Authority), Roissy airport recorded a total of 60,7 million passengers in 2011 and Orly, 27,1 million passengers.

(51)  Dublin, Barcelona, Milan, Rome and Stockholm. These five routes represent the most frequent departure routes from Beauvais between 2002 and 2010, accounting for up to 77 % of its total passenger traffic and were therefore likely to have a significant impact on the other Paris airports.

(52)  The number of passengers fell at Roissy on the Paris-Barcelona route from almost 1,2 million passengers in 2008 to less than 800 000 in 2010, compared with an increase of around 550 000 passengers at Orly in 2008 and close on 800 000 passengers in 2010. Beauvais airport’s share remained stable at around 300 000 passengers between 2008 and 2010.

(53)  The study showed that it took more than 1 hour to reach Beauvais airport from Paris whether by bus, car or train, while the journey to Orly or Roissy took less than 1 hour, or even half an hour.

(54)  According to the study, the time needed to travel to Beauvais airport from the centre of Paris precluded its air services constituting a credible alternative for intermodal passengers (mainly rail) from Paris. The study concluded that while local customers, i.e. those located in the immediate vicinity of Beauvais airport, might regard it as a substitute for rail to destinations within France, customers from Paris did not regard air services from Beauvais airport as substitutable for rail.

(55)  Ryanair relied in particular on the judgment of the Court of 3 July 2003 in Joined cases C-83/01 P, C-93/01 P and C-94/01 P, Chronopost SA, ECLI:EU:C:2003:388.

(56)  Oxera study of 11 September 2014 supplied by Ryanair with its comments of 12 September 2014.

(57)  Judgment of the Court of 16 May 2002 in C-482/99, France v Commission, ECLI:EU:C:2002:294, paragraph 45.

(58)  Wizz Air relied in particular on the judgment of the Court of 3 July 2003 in Joined cases C-83/01 P, C-93/01 P and C-94/01 P, Chronopost SA, ECLI:EU:C:2003:388.

(59)  In support of this argument, Wizz Air supplied a study by Oxera of 26 October 2012 showing that the airports of Doncaster, Liverpool, Memmingen, Prestwick and Stockholm-Skavsta were comparable to Beauvais.

(60)  Oxera study of 3 November 2014 supplied by Wizz Air with its comments of 4 November 2014.

(61)  Judgment of the Court of Justice of 4 May 1988, Bodson, C-30/87, ECLI:EU:C:1988:225, paragraph 18.

(62)  See, in particular, Judgment of the Court of Justice of 19 January 1994, SAT v Eurocontrol, C-364/92, ECLI:EU:C:1994:7, paragraph 30.

(63)  Paragraphs 35 to 37 of the 2014 Guidelines.

(64)  Judgment of the Court of Justice of 26 March 2009, Selex Sistemi Integrati v Commission, C-113/07 P, ECLI:EU:C:2009:191, paragraph 71.

(65)  Commission Decision of 7 December 2011 on State aid SA.32820 (2011/NN) — United Kingdom –Aid to Forensic Science Services (OJ C 29, 2.2.2012, p. 4), recital 8.

(66)  See Commission Decision (EU) 2015/1227 of 23 July 2014 on State aid SA.22614 (C 53/07) implemented by France in favour of the Chamber of Commerce and Industry of Pau-Béarn, Ryanair, Airport Marketing Services and Transavia (OJ L 201, 30.7.2015, p. 109), recitals 101 and 495, and Commission Decision (EU) 2016/633 of 23 July 2014 on State aid SA.33961 (2012/C) (ex 2012/NN) implemented by France in favour of Nîmes-Uzès-Le Vigan Chamber of Commerce and Industry, Veolia Transport Aéroport de Nîmes, Ryanair Limited and Airport Marketing Services Limited (OJ L 113, 27.4 2016, p. 32), recital 567.

(67)  Judgment of the Court of Justice of 3 March 2005, C-172/03, Wolfgang Heiser v Finanzamt Innsbruck, ECLI:EU:C:2005:130, paragraph 36.

(68)  Note: these investments related to the construction of a security and fire service room as well as the creation of hold baggage control and access control systems, a passenger flow separation corridor, security fencing, security screening check points, customs booths and a laser bird repellent, as well as the fees associated with these investments.

(69)  See Decision (EU) 2015/1227, recitals 101 and 495; and Decision (EU) 2016/633, recital 567.

(70)  See Table 6 (line ‘acquisition of safety and security equipment’).

(71)  This scheme was based on a tax levy (airport tax), and on an additional scheme (the Intervention Fund for Airports and Air Transport (‘FIATA’)) until 2008, when the State replaced the additional scheme with an increase in airport tax.

(72)  See, for example, the Decision (EU) 2016/633, recitals 32-42.

(73)  This amount relates to the projected amount included in the investment plan under the PSD agreement.

(74)  Judgment of the General Court of 25 January 2018, T-818/14, BSCA v Commission, ECLI:EU:T:2018:33, paragraph 102.

(75)  Judgment of the General Court of 24 March 2011, T-455/08, Flughafen Leipzig v Halle GmbH, ECLI:EU:T:2011:117, paragraph 95.

(76)  Judgment of 12 May 2011 in Joined Cases T-267/08 and T-279/08 Région Nord-Pas-de-Calais, ECLI:EU:T:2011:209, paragraph 108.

(77)  SMABT is a body governed by public law consisting entirely of local authorities which contribute two thirds of its financing and whose executive members come from those same authorities and act on their behalf.

(78)  Judgment of 12 May 2011 in Joined Cases T-267/08 and T-279/08 Région Nord-Pas-de-Calais, ECLI:EU:T:2011:209, paragraph 109.

(79)  Judgment of the Court of 5 June 2012, C-124/10 P, EDF, ECLI:EU:C:2012:318, paragraphs 80 and 81.

(80)  Judgment of the Court of 7 May 2020, C-148/19 P, BTB Holding Investments and Duferco Participations Holding v Commission, ECLI:EU:C:2020:354, paragraph 46.

(81)  See recital 61.

(82)  Judgment of the General Court of 16 January 2018, T-747/15, EDF v Commission, ECLI:EU:T:2018:6, paragraphs 240-242; Judgment of the Court of 19 December 2019, C-385/18 P, Arriva Italia Srl, ECLI:EU:C:2019:1121, paragraph 73.

(83)  That award took place when each of the three financing agreements was concluded, i.e. 23 July 2002 for the grants awarded by the Department of Oise, 12 December 2002 for the grants awarded by the Region of Picardie and 8 October 2002 for the grants awarded by the CCB.

(84)  See section 3.1.2.1.

(85)  This is apparent from the preambles to the financing agreements concluded in 2002 between the three local authorities and Oise CCI, and those concluded in 2006 between the same parties.

(86)  Judgment of the Court of 19 December 2019, C-385/18 P, Arriva Italia Srl, ECLI:EU:C:2019:1121, paragraph 73.

(87)  See recital 27.

(88)  See recital 131.

(89)  See recitals 17 and 39.

(90)  This is apparent from the preambles to each of the above-mentioned financing agreements.

(91)  See section 3.1.1.2.

(92)  See recital 131.

(93)  See Annex 14 to the PSD agreement.

(94)  Annex 14 provides that 
               ‘in return for SMABT’s contribution to the financing of the airport infrastructure, the concession holder undertakes to pay SMABT a profit share calculated on the basis of excess profit in relation to the projected internal rate of return of 10 %’
            .

(95)  According to Annex 14 to the PSD agreement, the entitlement to a share of profit is triggered in year (n) if the net income is positive, where the cumulative net income for the years (1) to (n) is positive and the internal rate of return thus calculated is above 10 %. The profit share was set at 50 % of excess profit.

(96)  Annex 14 of the PSD agreement.

(97)  Judgment of the General Court of 13 May 2020, easyJet Airline Co. Ltd., T-8/18, ECLI:EU:T:2020:182, paragraph 201.

(98)  Commission Notice on the notion of State aid as referred to in Article 107(1) of the Treaty on the Functioning of the European Union (OJ C 262, 19.7.2016, p. 1), point 89 and the case-law cited.

(99)  See the tendering rules, Chapter 7.

(100)  These elements included in particular the budgets implemented, the initial budget for 2007, the analysis of an independent firm of experts dated August 2007 providing updated information on the concession’s economic and financial data, the asset and liability items listed on the balance sheets, tax returns, amortisation tables and balances of financial commitments.

(101)  See judgments of 25 February 2008 (No 0800277) and 17 March 2008 (No 0800506) of the Administrative Court of Amiens.

(102)  Commission Notice on the notion of State aid as referred to in Article 107(1) of the Treaty on the Functioning of the European Union, paragraph 96.

(103)  This amount is a forecast amount as set out in the investment plan contained in the PSD agreement.

(104)  Judgment of 13 December 2018, Ryanair DAC, T-53/16, ECLI:EU:T:2018:943, paragraph 162.

(105)  Judgment of the Court of Justice of 4 June 2015, MOL, C-15/14 P, ECLI:EU:C:2015:362, paragraph 60.

(106)  See recital 129.

(107)  https://www.senat.fr/rap/l02-068-318/l02-068-31827.html#toc310

(108)  Points 28-29 of the 2014 guidelines.

(109)  See in particular Article L.1111-4 of the General Code for Local and Regional Authorities (‘
            Code général des collectivités territoriales
            ’)

(110)  Article L2224-8 of the General Code for Local and Regional Authorities (‘
            Code général des collectivités territoriales
            ’) stated that ‘
            the municipalities must bear the costs associated with collective sewage systems, in particular waste water treatment plants and the disposal of the sludge they produce, and expenditure on monitoring non-collective sewage systems
            ’. In the present case, Oise CCI carried out works relating to the collective network (connection of pavilions), which was thus the responsibility of the municipality of Tillé.

(111)  See Table 8.

(112)  See the Decision (EU) 2016/633, recitals 255 to 274, confirmed for example by the Court in the judgment of 13 December 2018, Ryanair v Commission, ECLI:EU:T:2018:943.

(113)  At the time when Oise CCI granted those advances, the chambers of commerce and industry were public bodies set up by law, administered by elected managers and supervised by the State. Moreover, as intermediate State authorities, and thus as public authorities of the State, they were entrusted by law with general interest tasks. In addition, Article L710-1 of the Commercial Code in force at the time when the aid was granted provided for specific financing arrangements for chambers of commerce and industry, the resources of which consisted, in particular, of tax revenues (the tax to cover the costs of chambers of commerce and industry, established by Article 1600 of the General Tax Code then in force), subsidies or even resources arising out of training and transport infrastructure operation activities.

(114)  See recital 183.

(115)  Judgment of the Court of Justice of 4 June 2015, MOL, C-15/14 P, ECLI:EU:C:2015:362, paragraph 60.

(116)  See paragraph 55 of the 2005 guidelines.

(117)  The fees in question concerned both public-remit investments (amounting to EUR 55 669) and investments related to the construction of infrastructure.

(118)  The subsidy of EUR 1 110 669 granted to cover the cost of public-remit tasks under programme 1 does not constitute State aid within the meaning of Article 107(1) TFEU, as indicated in recital 131.

(119)  The fees in question related to both public-remit investments (amounting to EUR 86 085) and investments related to the construction of infrastructure.

(120)  The subsidy of EUR 1 110 669 granted to cover the costs of public-remit tasks under programme 2 does not constitute State aid within the meaning of Article 107(1) TFEU, as indicated in recital 131.

(121)  Judgment of the Court (Grand Chamber) of 22 September 2020, C-594/18 P, Republic of Austria v Commission, ECLI:EU:C:2020:742, paragraph 20.

(122)  Moreover, this extension was not sufficient in practice since Beauvais airport had temporary structures (marquees, modules, etc.) installed to cope with the influx of passengers.

(123)  Between 800 000 and 1 000 000 passengers.

(124)  In its investment application file, Oise CCI states that the European market for low-cost flights was booming, with the market expanding from USD 400 million in 1996 to USD 1,5 billion in 2000.

(125)  The number of airport slots attributable each year is 250 000, while in 2013 there were 229 654 movements.

(126)  See the resolution of the Oise CCI General Meeting of 25 June 2001 on the Beauvais airport modernisation plan and the financing of that plan.

(127)  The concession concluded with Oise CCI was due to end in 2007. The State and the local authorities financing the investment programme then considered organising a tendering procedure for the renewal of the concession.

(128)  See Table 1. The actual annual traffic at Beauvais airport between 1999 and 2002 was between 200 000 and 700 000 annual passengers. The figure of 700 000 passengers was exceeded in 2003.

(129)  See Table 2 and recitals 217 and 220.

(130)  It should be noted that Beauvais airport also sought the assistance of local authorities to meet the urgent need to secure infrastructure (recitals 37 and 40).

(131)  See Table 2.

(132)  Judgment of the Court (Grand Chamber) of 5 June 2012, C-124/10 P, Commission v EDF, ECLI:EU:C:2012:318, paragraphs 84, 85 and 105.

(133)  Commission Notice on the notion of State aid as referred to in Article 107(1) of the Treaty on the Functioning of the European Union (OJ C 262, 19.7.2016, p. 1), points 101 to 105 and the case-law cited.

(134)  Fares increased from EUR 5,78 per journey in 1997 to EUR 14,22 in 2011.

(135)  Commission Notice on the notion of State aid as referred to in Article 107(1) of the Treaty on the Functioning of the European Union (OJ C 262, 19.7.2016, p. 1), point 84.

(136)  Article 3.3 (a) of the SAGEB shareholders’ agreement.

(137)  Article 3.1 of the SAGEB shareholders’ agreement.

(138)  Article 3.2 of the SAGEB shareholders’ agreement.

(139)  Article 3.3(f) of the SAGEB shareholders’ agreement.

(140)  The WIZZ3 contract affects all Wizzair traffic while the RYAN5 contract concerns the development of additional routes. The RYAN4 contract concerns the development of additional routes and affects 2,5 % of the airport’s traffic.