EU launches investigation into German state aid for Lufthansa

(Reuters) – The European Commission has opened an investigation into state aid Germany granted to airline Lufthansa during the COVID-19 pandemic in 2020, it said on Monday.

The 6 billion euro ($6.5 billion) recapitalization had been approved under the COVID-19 emergency framework but was annulled by the EU’s second-highest court last year. An appeal by Lufthansa against that decision is still pending.

The Commission’s investigation is a response to the Court’s decision, which found that errors had occurred in the procedure.

The aim now is to clarify whether the financial injections were in line with European state aid rules.

Since Lufthansa has already repaid the aid in full, the immediate impact of the court ruling is likely to be limited, but it could have consequences for future government bailouts.

A Lufthansa spokesman reiterated that the company had already fully repaid the measures and said that in its 2023 annual report, Lufthansa had expected the Commission to initiate a formal investigation, as it has done in similar cases.

(1 US dollar = 0.9228 euros)

(Reporting by Bart Meijer and Klaus Lauer, text by Miranda Murray, editing by David Goodman and Friederike Heine)