Vestager hits back at Lufthansa bailout criticism

Sallie Anderson

EU Commission vice-president Margrethe Vestager on Friday (29 May) hit back by at criticism she is being too difficult on the bailout bundle for Germany’s air provider Lufthansa.

Lufthansa and the German federal government today concurred a more than EUR9bn rescue bundle, making the German federal government take a 20 percent stake in the airline company, which now needs a thumbs-up from commission competition regulators.

  • Vestager: ‘There is a high danger that if you hold market power, that you are a big, outstanding business, and you get a great deal of help, that competition will be interrupted, this is why we request for a treatment’ (Picture: European Parliament).

Vestager stated the commission is not “creating extra hurdles” – arguing that business getting big capital injections from the state need to offset their competitive benefit.

“We are making sure that when any company with market power with a recapitalisation bigger than €250m, that disturbance of competition is being remedied. Because the economy will pick up again, and there will competitors to any company with market power and state recapitalisation, who will compete against this company,” Vestager described to press reporters in Brussels.

“It is to be able to balance the situation and make sure that the single market is still working,” she stated.

“There is a high risk that if you hold market power, that you are a big, impressive company, and you get a lot of aid, that competition will be disturbed, this is why we ask for a remedy,” Vestager stated.

Lufthansa, on the other hand, has actually criticised EU regulators for asking the airline company to quit some slots at its centers in Frankfurt and Munich, where it commands a two-thirds marketshare


Commission regulators are under pressure to scrutinise big aids federal governments are now distributing to to assist in the coronavirus crisis. Trillions of euros in state help have actually currently been authorized, in general.

German MEP Daniel Caspary, who heads the parliamentary delegation of Germany’s judgment Christian Democrats, criticised Vestager for what he views as the weakening of big European business.

“It is pathetic that Ms Vestager regularly decides to weaken European companies such as Lufthansa, Alstom, Bombardier in the global market,” he tweeted.

The commission in 2015 chose to prohibit the merger of Germany’s Siemens and France’s Alstom to produce a European train business, mentioning issue over increasing rates and expenses for taxpayers.

Both the German and french federal governments supported the offer, and some argued that Vestager’s analysis of competition guidelines obstruct European business’ global role.

“Moreover, Vestager has has not been able to tackle the excessive market power of companies like Amazon, Google, Facebook and others on European and international markets. By that, she is harming the #EU’s global competitiveness,” Caspary argued.

“Commissioner Vestager should immediately approve the Lufthansa rescue package without further requirements,” headded


Affordable provider Ryanair, which likewise got aid from the UK federal government, has actually challenged the Lufthansa bailout, arguing it would misshapecompetition


“How can airlines like Ryanair, EasyJet and Laudamotion be expected to compete with Lufthansa in the short-haul market to and from Germany, now that it has €9bn worth of German government subsidies to allow it to engage in below-cost selling or buy up even more competition for the next number of years,” Ryanair CEO Michael O’Leary stated previously today in a declaration.

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