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Brussels, 23 July 2008

State aid: Commission authorises aid for infrastructure at Leipzig Halle Airport; prohibits certain guarantees in favour of DHL

The European Commission has today decided, under EC Treaty state aid rules, that some €350 million of public investment for a new southern runway at Leipzig Halle airport is compatible state aid. However, the Commission has also decided that guarantees worth up to €500 million for express cargo provider DHL, in case Leipzig Airport cannot meet the conditions of a Framework Agreement related to DHL establishing its European hub there, are incompatible with the Single Market. In particular, the Commission concluded that the unlimited guarantee allowed DHL to hedge business risks on terms which a private investor would not have accepted and would distort competition. The Commission opened its investigation in November 2006 (see IP/06/1603).

On 5 April 2006 the German authorities notified arrangements concerning the establishment of the European hub of DHL Group at Leipzig-Halle Airport. On 22 November 2006 the Commission decided to open a formal investigation in respect of these measures. The measures under investigation were:

  • capital contributions of about €350 million to Leipzig Airport for financing the construction of the new southern runway
  • a Framework Agreement between Leipzig Airport, its parent company Mitteldeutsche Flughafen AG (MFAG) and DHL, which obliges the airport to construct the new southern runway, and to honour further assurances for the entire 30-year duration of the agreement, inter alia concerning operational requirements (including the possibility to operate at night);
  • A comfort letter issued by the Land Sachsen in favour of Leipzig Airport and DHL which guarantees DHL up to €500 million in case Leipzig Airport cannot meet the conditions of the Framework Agreement.

Having concluded that the investment measure constitutes s tate aid, the Commission has reached the conclusion that the capital investment in the airport infrastructure constitutes compatible state aid in accordance with the applicable Community framework (Community guidelines on financing of airports and start-up aid to airlines departing from regional airports – see IP/05/1097).

However, the Commission has concluded that the unlimited warranties granted by the Framework Agreement and the comfort letter constitute aid in the meaning of EC Treaty state aid rules (Article 87(1)) because the Land Sachsen, MFAG, and Leipzig Airport hedge business risks for DHL at terms which a private investor would not have accepted.

As DHL has already benefited from the maximum amount of investment aid permissible under EC Treaty rules allowing state aid for regions with an abnormally low standard of living and high unemployment (Article 87(3)(a)), the Commission considers that DHL may not benefit from any further aid. The unlimited warranties granted by the Framework Agreement and the comfort letter must therefore be abolished. The part of the aid which has already unlawfully been put at the disposal of DHL must be recovered.

On 2nd July 2008, the Commission endorsed €1.6 million of training aid at DHL's Leipzig-Halle site but rejected a further €6.1 of aid which would have acted as an illegal operating aid (see IP/08/1076).

The non-confidential version of the decision will be made available under the case number C 48/2006 in the State Aid Register on the DG Competition and DG Energy and Transport websites once any confidentiality issues have been resolved. New publications of state aid decisions on the internet and in the Official Journal are listed in the State Aid Weekly e-News.

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