Berlin Brandenburg airport to receive €1.7 billion state aid

The German government has secured European Commission approval to provide Berlin Brandenburg Airport with €1.7 billion ($1.9 billion) in state aid as it struggles to stay afloat.  

The European Commission gave the green light for the German government to recapitalize  Flughafen Berlin Brandenburg Gmbh (FBB), the state-owned operator that manages the airport.  

Germany notified the European Commission about the need for BER airport to receive state aid after FBB suffered substantial losses because of significant operational costs and stringent travel restrictions caused by the COVID-19 pandemic.  

The government aims to recapitalize the airport “by allowing its public shareholders, the Lander Berlin and Brandenburg and the Federal Republic of Germany, to inject the capital into FBB's capital reserve,” according to a European Commission statement dated February 1, 2022. 

Meanwhile, Margrethe Vestager, the executive vice-president of the European Commission, said that the Commission found the recapitalization measures to be in line with EU State aid rules. Vestager also stated that while BER airport has been severely affected by travel restrictions imposed during the pandemic, the public support will “come with strings attached to limit undue distortions of competition”. 

Vestager added that the Commission closely cooperates with the Member States “to ensure that national support measures can be put in place as quickly and effectively as possible, in line with EU rules”. 

As part of the terms for state aid approval, Germany has also committed to working out a credible exit strategy within a year of the financial support being granted, “unless the State's intervention would be reduced below the level of 25% of equity by then,” the statement adds.  

The government will also provide the Commission with a restructuring plan for FBB if the airport operator’s equity does not shrink below 15% seven years after its recapitalization. 

The Commission concluded: “The recapitalization measure is necessary, appropriate, and proportionate to remedy a serious disturbance in the economy of a Member State, in line with Article 107(3)(b) TFEU and the conditions set out in the Temporary Framework. The measure aims at restoring the financial position and liquidity of FBB 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 measures under EU State aid rules.”