9 million of tax benefits compared to 2

November 27, 2011 12:00 AM

Apart from a few bitter cruciverbistes, who knows Knock, Reus, Bydgoszcz, Cuneo or even Cluj Napoca These obscure European villages welcome but every year hundreds of thousands of travellers, who have probably never thought put feet, if the "low cost" fairies had come out of anonymity. As the railroad in the 19th century, low-cost companies indeed drew a new map of Europe, where Beauvais has replaced Paris, Hann became Frankfurt, Reus is Barcelona, while Bydgoszcz or Carcassonne offer more lines on Britain Strasbourg or Lyon. Over the past five years, companies low-cost European traffic has more than doubled, reaching 162.5 million passengers last year, or 35 of intra-European air traffic.

The sector has its stars, such as easyJet, of course, but especially the Irish Ryanair, become the real "bête noire" of his opponents in the first rank of which Air France. First company to have complained as early as 2003 against the aid paid by Ryanair Strasbourg airport, the French group departed the assault by filing last November, a new complaint before the European Commission against AIDS paid to Ryanair by 25 regional airports French. Defiant Irish growth is passed by there. He only Ryanair could carry more passengers than Air France-KLM in the world this year. A rise that French local councillors, like most of their European counterparts, have ample favoured. With 26.5 million passengers last year, is close to 1 million more than in 2008, low-cost companies now account for 18.9 of French airports traffic - 2.9 in 2001 - and 28.1 per cent for only province airports. A phenomenon that irritates and creates more and more virulent critics.

Discounts and marketing aid

Stop the irresistible rise of Ryanair Air France is not only to try it. The main trade union organisations of the group, the CGT, UNCAC and the SNPL, have also filed a complaint against the Irish for "hidden work" and "interference with freedom of Association". A way to put pressure on Brussels so that the Commission should reconsider this year the regulation of 2005 on State aid, which depend largely on the results of the Irish. "The benefits of Ryanair are paid by European taxpayers, rebelled José Rocamora, Secretary General of the CGT Air France.". These illegal practices endanger the economic equilibrium of firms that comply with French and European law. "In total, nine complaints, all directed against Ryanair, are under consideration before the European Commission, concerning airports as various as Pau in France, Berlin, Hann and Lübeck in Germany or the Denmark Aarhus.

In the heart of the controversy: the discounts and marketing aid required by Ryanair as a condition for the opening of a line. "They appeared in the early 2000s, remembers a French airport Director." At the beginning, was to participate in a few promotional campaigns. But, little by little, the principle is installed and the amounts were inflated. Moved from 3 to 5 and 10 euros per passenger. "Nobody is escapes", he says. According one of the few reports made by the regional chambers of accounts, the total amount of aid granted by the French regional airports in 2008 amounted to 33.2 million euros, or an average of 1.3 million by airport. Extrapolating this figure to some 150 regional European airports where Ryanair is present, can thus be estimated to about 195 million the total of the aid collected by the Irish company, is 40 of its record profits in 2008 (EUR 481 million). Other estimates, including the CGT of Air France are however more significant figures.

In theory these public aid are authorized by European regulation, to promote line openings in regional airports, but under certain conditions. "They should last more than three years, be tapered, and do not exceed, in total, 30 of the amount of the additional costs", says Nadège Chapier-Granier, air transport at the law firm Field Fisher Waterhouse lawyer. "They must also be open to any company who requests." In addition, discount on airport charges or aid, they must be discussed in the Joint Committee with all the users of the platform companies, and be notified to the authorities or the Commission.

Threats of departure

But in practice, the

things are very different. "No one has the same contract with Ryanair, who knows perfectly put airports compete to raise the auction", says a Director of airport from the Southwest, where the fight is tough to attract or retain valuable source of growth. Examples abound. Thus, in Pau, last January, Ryanair claimed local communities the quadrupling of the marketing help, or 2.8 million euros over two years, to maintain its lines on London and Charleroi, and open a line on Beauvais... For the respect, the community of agglomeration first refused to yield to this requirement, which would have led it to pay 400,000 euros... to finally accept to go up to 250,000 euros, 2.5 times the amount back. The Irish company threatened to go to Tarbes, 50 kilometres away. In Charente, things turned worse. After already obtaining to 925.000 euros in aid over three years, as purchase of advertising space on its site, for the opening of an Angouleme-London line, Ryanair has required an extension of 175.000 euro. To the intransigence of the President of the General Council, Michel Boutant, who was in was publicly outraged, the company announced its intention of folding luggage. At the same time, La Rochelle and Poitiers, apparently more empathetic with Ryanair, each earned a line to Dublin and Barcelona. At Poitiers, the General Council of the Vienna had well dismissed last month an application of Ryanair, claiming 1.7 million euros for 2010, for the maintenance of the lines to Edinburgh, London and Birmingham, but finally accepted a contribution of 700,000 euros, likely to be extended to 1.1 million for opening of a new line.

The local councillors seem if unarmed threats of departure of Ryanair, is that all local economic studies agree to recognize the economic impact of the airport on the region. At Bergerac, is estimated at 265 million euros, including 198 million related to the spending British, Belgian and Dutch, 60 million for the real estate market and 6.9 million of tax benefits, compared to $ 2.3 million of euros in aid over three years. At Beauvais, first airport to have allowed Ryanair in 1997, direct benefits were estimated at 580 million euros over the past five years, according to its Director, Marc Amoudry. "We went from 40 to 800 jobs in ten years, he says". And the airport, which had an annual loss of 1 million francs 15 years ago, today profit EUR 1 million. "In a report released in February 2008 to the Government, Jacques Sabourin, General of the Union of French airports delegate, was total some EUR 4 billion injection of money generated by the"low cost"companies in France.

Too many airports in the region

Remain the abuses that everyone wants to recognize, including supporters of the "low cost", even if opinions diverge on the means to remedy. Should tighten up the legislation and require Ryanair to reimburse the amounts unduly collected, as in a dream Air France "All transport infrastructure have been developed with subsidies." Why penalise airports, which are vital for the economic development of the regions ", protested Klaus Klipp, the representative of the Assembly of European regions, which argues instead for the relaxation of European rules.

"The problem in part of the large number of airports in some regions, which promotes outbid, analysis of a head of airport turn." Is it reasonable to have 6 remote airports of 40 kilometres in Languedoc-Roussillon "The righteous position of Air France on subsidies, it leaves skeptical over a. "Comparing marketing aid to those enjoyed by the regional subsidiaries of Air France, in"public service obligations"lines, the result is edifying, loose pattern of an airport." Paris-Bergerac, which is painfully 10,000 passengers per year, receives a million of grants per year! "Moreover, previous Air France initiatives have not left only memories. In 2003, the French company had obtained the prohibition of subsidies granted to Ryanair from the Strasbourg airport to London-Stansted line, who then competed with a bond of Brit Air on the British capital. Dismissed, Ryanair then went across the Rhine in Baden-Baden. Result, seven years later, Brit Air has abandoned the Strasbourg-London line, deficit, and Strasbourg airport is sinking into recession, while Ryanair today operates a dozen lines out of Baden-Baden... which exceeded the one million passengers.