Move follows European Commission decision
Following a decision by the European Commission that a €100 million state aid package was against the rules, the government of Cyprus said it had no option but to pulled the plug on crippled national carrier Cyprus Airways.
The carrier had been ordered to pay back €65 million plus interest. The government is now implementing arrangements for passengers who have tickets.
“Cyprus Airways has received large quantities of public money since 2007 but was unable to restructure and become viable without continued state support,” Commissioner Margrethe Vestager, in charge of competition policy, said.
“Therefore, injecting additional public money would only have prolonged the struggle without achieving a turn-around. Companies need to be profitable based on own merits and their ability to compete should not rely on taxpayer money to stay in the market artificially.”
Ryanair, which had previously made an approach for the airline, said it would offer special fees for stranded passengers.
[pictured: Cyprus Airways engine in sunset; photo courtesy Cyprus Airways]