Would the delays caused by the impoundment of an aircraft due to the airline's failure to pay an outstanding debt to local authorities amount to an "extraordinary circumstance" under EC 261/2004?

By Simon Phippard, Rachel Welch Phillips

01-2019

On 8 November 2018 the press reported that Ryanair was required to pay approximately €525,000, according to regional airport officials, to secure the return of a Boeing aircraft impounded at Bordeaux airport.

The aircraft was seized by a bailiff commissioned by the county council due to Ryanair's failure to pay the outstanding debt. The French Civil Aviation Authority has since released the aircraft from Bordeaux Airport as the Irish carrier agreed to pay the sums owed.

The debt arose from benefit Ryanair received from the French government related to the airline's activities at the regional airport of Angouleme between 2008 and 2009. In 2014, the European Commission (EC) concluded that Ryanair received state aid which was incompatible with EU rules: "The airline therefore benefitted from an undue economic advantage, distorting competition in the Single Market. France must now recover the incompatible aid from the companies that received it in order to restore the level playing field" the EC wrote in a statement in 2015. The ruling by the EC was one of seven findings of illegal state aid between 2014 and 2016 against Ryanair’s arrangements at regional airports that included Nîmes, Altenburg, Zweibrücken, Cagliari and Klagenfurt.

Given the EC's powers to ensure that Member States implement their recovery obligations, it is not uncommon for  Member  States to  take voluntary  steps to recover the unlawful aid.

The seizure meant that the 149 passengers due to travel from Bordeaux on the immobilised aircraft had to be re-booked to arrive at their destination resulting in a five hour delay. Under Regulation 261, delays of over 3 hours, for reasons which do not amount to "extraordinary circumstances" which could not have been avoided even if all reasonable measures had been taken result in an entitlement to fixed rate compensation.

There is insufficient detail in the public domain to gauge the rights and wrongs of the enforcement action, and no reason to believe anything was improper. However the facts do raise the hypothetical question of the ability of an airline to rely on the "extraordinary circumstances" defence if enforcement action suddenly resulted in an aircraft being unavailable for revenue service. A similar question might arise from a private law dispute over termination of a lease. Contrast a situation where for instance, an enforcement agency purported to exercise a right of detention for unpaid airport or air navigation services against an aircraft which, on a proper analysis of the statutory right, was simply not at risk of detention. Whether or not the detention amounts to extraordinary circumstances requires an analysis of whether the risk of detention is or is not inherent in the airline's normal activity and whether it is beyond their control. If an aircraft is subject to a "bolt from the blue" detention that analysis may be rather different from that where the debt is undisputed and presently enforceable under local applicable law. We anticipate that the courts would have less sympathy for an airline which they perceived to be on notice of the risk and simply chancing its arm in hoping that authorities will not proceed to detention.