Finance
EU's Top Court Upholds Annulment of Lufthansa State Aid Approval
Published by Global Banking & Finance Review®
Posted on April 23, 2026
2 min readLast updated: April 23, 2026
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The EU’s General Court has upheld the annulment of the Commission’s approval of Germany’s €6 billion COVID‑19 bailout for Lufthansa, siding with Ryanair’s complaint that the Commission misapplied EU state aid rules and failed to assess market financing properly.
Lufthansa loses appeal in state aid dispute with Ryanair
EU Court Ruling and Implications for Lufthansa
Lufthansa's Appeal and Court Decision
BRUSSELS, April 23 (Reuters) - Germany's Lufthansa lost its appeal on Thursday against a court ruling that struck down EU approval of state aid it received during the COVID pandemic, confirming a victory for rival Ryanair.
The European Union's Court of Justice dismissed Lufthansa's appeal, upholding a General Court ruling that annulled the European Commission's decision to clear the airline's recapitalisation.
Official Statement from the Court
"By its judgment today, the Court of Justice dismisses Lufthansa's appeal and thus upholds the General Court's ruling," the court said in a statement.
Background of the Legal Challenge
The original ruling dates back to 2023 and followed a legal challenge brought by Ryanair.
Lufthansa's Response and Ongoing Developments
Lufthansa's Statement on the Ruling
“We take note of the European Court of Justice’s ruling. At the same time, we would like to point out that the European Commission’s investigation, which has been ongoing since 2024 and is intended to lead to a new decision, can now take the ECJ’s ruling into account. We will engage constructively in the ongoing process and are in close contact with all relevant institutions,” Lufthansa said.
Operational and Industrial Challenges
Pilots' Union Dispute and Strike Action
The decision comes as Lufthansa is embroiled in a dispute with its pilots' union over pensions and has been hit by strike action. The group said on Tuesday it would cut 20,000 short-haul flights from its schedule through October and earlier this month announced the permanent withdrawal of 27 CityLine aircraft, citing higher jet fuel prices and costs linked to the industrial action.
Responses from Other Parties
The European Commission and Ryanair did not immediately reply to requests for comment.
Reporting Credits
(Reporting by Inti Landauro and Yun Chee Foo in Brussels, Charlotte Van Campenhout in Amsterdam, Ilona Wissenbach in Frankfurt, Additional reporting by Miranda Murray in Berlin, Editing by Mark Potter)
Key Takeaways
- •The General Court confirmed that the European Commission committed errors—particularly by not evaluating whether Lufthansa could access private financing and misjudging its market power, leading to annulment of the aid approval (euronews.com).
- •Ryanair’s challenge succeeded in 2023 when the General Court annulled the approval, and the recent ruling upholds that decision—reinforcing legal scrutiny over pandemic-era state aid (euronews.com).
- •Lufthansa has already repaid the stabilization measures and interest, limiting the practical impact of the ruling, but it underscores stricter enforcement of state aid fairness in the EU single market (euronews.com)
References
Frequently Asked Questions about EU's top court upholds annulment of Lufthansa state aid approval
1What did the EU's top court rule about Lufthansa's state aid?
The EU's top court upheld the annulment of the European Commission's approval of Germany's €6 billion bailout of Lufthansa.
2Why was the Lufthansa bailout approval annulled?
The annulment followed a legal action initiated by Ryanair, challenging the European Commission's approval of the aid.
3When was the original Lufthansa state aid ruling made?
The original court ruling annulling the state aid approval was issued in 2023.
4Who initiated the legal challenge against the Lufthansa bailout?
Irish airline Ryanair initiated the legal action against the approval of Lufthansa's bailout.
