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Last Updated: Wednesday, 12 November, 2003, 12:38 GMT
Ryanair braced for Belgium ruling
Ryanair plane on the tarmac
The chief executive of Irish budget airline Ryanair has said it will drop Belgium as a base if a European Union subsidies decision goes against them.

The legality of subsidies to Ryanair - from Belgian local government to use Charleroi airport - is being examined under EU competition rules.

If it rules the airline gets illegal state aid, then Ryanair will leave the airport, at least temporarily.

Chief executive Michael O'Leary said: "We will just move... to other bases."

A negative decision ... will do untold damage to the growth of low-fare air travel
Ryanair chief executive Michael O'Leary
The European Commission, which enforces EU competition rules, has been investigating the legality of subsidies Ryanair receives.

Dublin-based Ryanair has four aircraft based in Charleroi, south of Brussels, serving around 2 million passengers a year with 12 destinations.

In an indication that any ruling could be set to go against the company, Mr O'Leary said the low-cost carrier was already in negotiations with two other airports in Europe.

Competitors unhappy

Mr O'Leary said: "A negative ruling won't impact our financial position. We will just move the aircraft to other bases.

"A negative decision... will do untold damage to the growth of low fare air travel and competition in European air transport."

He said if the Commission decision was against Ryanair, as many as four million passengers could be affected, primarily in France and Spain, with little impact on Irish or British airports.

Competitors such as Virgin Express, which is based at Brussels' Zaventem international airport, have accused Ryanair of unfair competition.

Privatisation move

Mr O'Leary said that a draft European decision which was "circling" appeared to indicate that "a significant portion" of its Charleroi operation included illegal aid.

He said Ryanair would appeal to the European Court in Luxembourg.

It would also enter talks with both Charleroi and the Walloon government to explore the possibility of the airport being privatised and a similar low-cost arrangement being set up.

In September Ryanair suspended services to Strasbourg after a French court declared its deal with the local airport amounted to illegal state aid, following a complaint by Air France.


WATCH AND LISTEN
BBC's Quentin Sommerville in Brussels
"The ruling would also affect around four million other Ryanair passengers."



SEE ALSO:
Profits news gives Ryanair lift
03 Nov 03  |  Business
Airline creates 200 jobs
29 Oct 03  |  Scotland
Ryanair halts Strasbourg flights
26 Aug 03  |  Business
Ryanair profits grow by 12%
05 Aug 03  |  Business
Ryanair perfects budget flying
04 Jun 03  |  Business


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