The Passing-on Defence Catapulted Out of State Aid Law: Annotation on the Judgments of the Court of Justice the European Union (Third Chamber) of 21 December 2016 in Joined Cases C-164/15 P Commission v Aer Lingus and C-165/15 P Commission v Ryanair

The annotated judgment concerns the aftermath of a differentiated taxation on travelling. The General Court partially annulled the Commission’s decision and found that the recovery of the aid should be limited to the advantage actually retained by the airlines, taking into account the competitive situation as well as the possibility that the advantage could have been passed on to the passengers through lower ticket prices. The Commission appealed this judgment and the Court of Justice of the European Union (CJEU) found for the Commission; thus, the nominal amount of aid should be recovered. The judgment thereby upholds the status quo reasonably taking into account all indirect effects of State aid.