Announcing the Commission's decision on Ryanair's discount deal with Charleroi Airport, the Transport Commissioner, Ms Loyola De Palacio, claimed that it was good news for low-cost airlines and for regional airports.
She said the Commission wanted to guarantee equal treatment for all operators and insisted she had carefully considered the impact of the decision.
"We are applying the treaty but we are taking account of the facts," she said.
The Commission has asked the Belgian region of Wallonia, which owns Charleroi, to respond to the decision within two months.
Before deciding what to do about Ryanair, the Commission had to establish if the assistance it received from Charleroi amounted to state aid. To do this, the Commission applied the "private investor" principle, asking if a prudent private investor would have granted the conditions offered by Charleroi.
Under an agreement reached in private in 2001, Ryanair pays only 50 per cent of the published charges for landing and ground handling.
The airport contributes to Ryanair's marketing costs, pilot training and hotel accommodation and offers incentives linked to new routes.
"A private investor would not have been in a position to grant this kind of aid and back-up," Ms De Palacio said.
Having established that Ryanair received state aid, the Commission then considered how much of that aid was compatible with the EU's common market. Ms De Palacio concluded that about 75 per cent of the assistance offered was admissible but that the rest should be repaid.
The Commission said that such assistance should not account for more than 50 per cent of the cost of the service in question and that it could be offered for a maximum of five years.
"Studies show that in order to consolidate the position of an airport, you need between three and five years," Ms De Palacio said.
A great part of the Commission's problem with the Ryanair deal was that it was negotiated in private and was not publicised. If, as the Commission maintains, the assistance constitutes state aid, the Walloon authorities had an obligation to notify the Commission of its intentions. "Had they notified it and made it public, we might have taken a different decision," Ms De Palacio said.
Ms De Palacio rejected the suggestion that low air fares constituted a justification for state aid to airlines and suggested that Ryanair's Charleroi deal undermined other carriers.
"These agreements were totally confidential. I am not saying they cheated but it was at least hushed up and this may have abused the good faith of others I feel there has been a clear lack of transparency and other carriers were not being offered the same conditions," she said.
Ms De Palacio said complaints had been made to the Commission and to national authorities about similar deals at other airports and said that they would be judged on a case-by-case basis.
The Commission is, however, planning to present proposals to EU transport ministers that could include guidelines for the granting of state aid to airlines at regional airports.
