IAG issues a pre-Brexit State aid complaint to the EU Commission

  • 1 min read

British Airways' owner IAG has filed a formal complaint with the EU Commission arguing that the UK Government's rescue measures to help save Flybe from collapse breach the State aid rules. 

Complaints to the EU Commission can take a significant amount of time to resolve and so IAG might also be minded to challenge the UK Government through the courts in the UK by way of a judicial review action in the High Court. It is likely that the challenge would be based on a claim that the UK Government's decision to provide Flybe with the rescue measures was illegal or 'ultra vires' which means that the UK Government has acted beyond its legal power or authority. IAG could seek damages or an injunction against the UK Government. The High Court would have the ability to order repayment of the alleged unlawful State aid before the EU Commission has made a final decision regarding IAG's complaint. 

A judicial review case could be particularly appealing to IAG as it isn't completely clear what the UK's State aid policy will be post-Brexit or what the impact of the EU Commission's decision would be if it was handed down post-Brexit. 

The UK Government's actions appears to show what the direction of travel for the State aid regime in the UK post-Brexit is likely to be. The Prime Minister Boris Johnson has previously spoken about his desire to change the State aid rules to enable the UK Government to be able to help struggling industries and address economic turbulence.


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