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NICOSIA – Cyprus Airways shut down after the European Commission ordered it to pay back more than 65 million euros in unlawful state aid.

EU Competition Commissioner Margrethe Vestager said Cyprus Air was being improperly propped up with state subsides in 2012-13 as part of a 103-million-euro restructuring package it would have to repay the government.

“The company has ceased being a viable entity and cannot continue to operate,” Finance Minister Harris Georgiades told reporters after the decision.

Asked when the company would cease flights, he said, “From [Saturday] there will be alternative arrangements.”

An administrator would be appointed and it was expected its air license certificate would be revoked, he said.

Under EU rules a company can only receive state assistance once every 10 years. Cyprus Airways, which recently resorted to selling assets such as its slot at London Heathrow to stay afloat, had previously received financial assistance in 2007.

The Commission opened an investigation into the aid in March 2013, and the state-owned airline has 10 years to pay back the money.

The Commission said Cyprus had provided no evidence that the airline faced “exceptional and unforeseeable” circumstances that would justify additional aid after the 2007 rescue package.

The post EU Ruling Shuts Down Cyprus Airways appeared first on The National Herald.

Source: The National Herald
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