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Commission approves €39.7 million Latvian measures to recapitalize Riga International Airport

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The European Commission has approved Latvian plans to grant up to €39.7 million for the recapitalisation of the State Joint Stock Company Riga International Airport (Riga International Airport). The measures, comprising a €35.2 million capital injection and €4.5m of waived dividend payment for the 2019 financial year, were approved under the state aid Temporary Framework. Riga International Airport suffered substantial losses due to the coronavirus outbreak and the travel restrictions that Latvia and other countries had to impose to limit the spread of the virus. These measures, together with the significant drop in travel demand, continue to deteriorate the financial situation of the company.

As a result, Riga International Airport currently risks not being able to maintain its viability, with severe consequences for the connectivity of Latvia with the rest of Europe and third countries. The Commission found that the recapitalisation measure notified by Latvia is in line with Article 107(3)(b) TFEU and the conditions set out in the Temporary Framework. The Commission concluded that the recapitalisation measures are necessary, appropriate and proportionate to remedy a serious disturbance in the economy of the member states: the measure aims at restoring the financial position and liquidity of Riga International Airport in the exceptional situation caused by the coronavirus pandemic, while maintaining the necessary safeguards to limit competition distortions. On this basis, the Commission approved the measure under EU state aid rules.

Executive Vice President Margrethe Vestager, in charge of competition policy, said: “Airports are among the companies that have been hit particularly hard by the coronavirus outbreak. With this measure, Latvia will contribute up to €39.7m to reinforce Riga International Airport's equity and support the company face the economic effects of the outbreak. At the same time, the state aid will come with strings attached to limit undue distortions of competition. We continue working closely with member states to ensure that national support measures can be put in place in a coordinated and effective way, in line with EU rules.”

The full press release is available online.

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