Arab Today, arab today estonian air bites dust under eu ruling
Last Updated : GMT 04:59:35
Arab Today, arab today
Arab Today, arab today

Estonian Air bites dust under EU ruling

Arab Today, arab today

Arab Today, arab today Estonian Air bites dust under EU ruling

A view of the old city of Tallinn
Tallinn - AFP

Estonia's flagship airline on Saturday announced its bankruptcy after the European Union ruled it would have to pay back 85 million euros plus interest of state aid pumped into the struggling business to keep it flying.

Authorities in Tallinn however moved to absorb the shock by immediately setting up a new carrier to take over key routes.

"Estonian Air will cease operations from November 8," the company's web page said Saturday.  

The carrier promised passengers with tickets would be offered replacement flights with other airlines, or they could claim a refund payable in December.

The announcement came after the European Commission earlier Saturday ordered the state-controlled airline to pay back the millions it had received in aid.

"The European Commission has concluded that aid measures by Estonia in favour of national flag carrier Estonian Air gave the company an undue advantage over its competitors in breach of EU state aid rules," the EU's executive branch said in a statement.

"Estonian Air therefore needs to pay back the state aid already received, which according to the Commission's information amounts to about €85 million ($91 million) plus interest, and cannot receive an additional €40 million of restructuring aid," it added.

The Baltic country's flagship carrier had been struggling financially since 2006, the Commission said, adding that the company should not continue to rely on public money to survive.

"It would not be a good use of taxpayer money to keep Estonian Air in the market artificially -– nor would it be fair to competitors, which have to compete without such support," said Commissioner Margrethe Vestager, in charge of competition policy.

The government in Tallinn announced it had already formed a new state-owned business named the Nordic Aviation Group (NAG) that would take over eight of Estonian Air's key routes from Sunday.

"The rules of the European Union are very harsh, that is why we start with a clean sheet and a new team," NAG chairman Peeter Tohver said in a statement, adding that the new company should not be seen as Estonian Air's legal successor.

NAG does not yet have its own fleet or crew. Other airlines will be contracted to operate flights, while Slovenia's Adria Airways will provide the operator's certificate, commercial platform and ticketing system.

The European Commission, which has probed several other European airlines, has in the past also ordered Cyprus Airways and Hungary's Malev to pay back aid packages deemed illegal.

Both airlines were also subsequently closed.

Estonian Air was formed soon after the country regained its independence from the Soviet Union in 1991.

"Thank you to all employees of Estonian Air for 24 years of good service," Prime Minister Taavi Roivas tweeted.

 

arabstoday
arabstoday

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today estonian air bites dust under eu ruling Arab Today, arab today estonian air bites dust under eu ruling

 



Arab Today, arab today

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today estonian air bites dust under eu ruling Arab Today, arab today estonian air bites dust under eu ruling

 



Arab Today, arab today France defies terrorism through tourism

GMT 15:18 2017 Saturday ,20 May

France defies terrorism through tourism
Arab Today, arab today Zainab Fadel Oglu designs “Shakerin” mosque

GMT 12:13 2017 Thursday ,11 May

Zainab Fadel Oglu designs “Shakerin” mosque
Arab Today, arab today Seeks to move past rift with Israel

GMT 08:00 2017 Monday ,08 May

Seeks to move past rift with Israel
View News in Arabic - Business: أخبار الشركات
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today Mozambique's gas boom dream under threat

GMT 16:29 2017 Monday ,08 May

Mozambique's gas boom dream under threat
Arab Today, arab today Prepares to give stargazers an eyeful

GMT 13:38 2017 Monday ,06 March

Prepares to give stargazers an eyeful
Arab Today, arab today Jaguar displays XF Sportbrake line

GMT 14:36 2017 Monday ,08 May

Jaguar displays XF Sportbrake line
Arab Today, arab today BMW sees forecasts in reach

GMT 09:04 2017 Thursday ,04 May

BMW sees forecasts in reach
Arab Today, arab today Climate science: Bad news gets worse

GMT 08:48 2017 Saturday ,06 May

Climate science: Bad news gets worse
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday