The European Commission has opened an in-depth investigation to examine whether a €25m capital injection by SEA SpA, the publicly owned manager of the Italian airport Milan, in favour of its new ground-handling subsidiary Airport Handling was in line with EU state aid rules.

 

The opening of an in-depth investigation gives interested third parties the opportunity to comment. It does not prejudge the outcome of the investigation, says the European Commission.

 

Above: SEA’s Milan Malpensa Airport (MXP).

 

The Commission will examine whether this capital injection is a circumvention of its December 2012 decision, which required the repayment of incompatible aid granted by SEA SpA to its then ground-handling subsidiary SEA Handling.

 

According to Italian authorities, there is no economic continuity between SEA Handling, which was wound up in June 2014, and Airport Handling, which started its operations on 1 July 2014.

 

CAPITAL INJECTION ON MARKET TERMS?

However, the Commission has concerns that the aim and result of creating the new company was to avoid repaying the incompatible state aid, since the scope of the transferred activities, the price of the transferred assets, the identity of shareholders and the timing and economic logic of the operation all seem to indicate that Airport Handling is in fact the successor of SEA Handling.

 

Pietro Modiano, President of SEA.

 

The Commission will also assess whether the capital injection was carried out on market terms. Italian authorities argue that SEA SpA has acted as any private investor would have when injecting capital into Airport Handling, so this measure did not provide Airport Handling with an undue advantage and does not constitute state aid.

 

At this stage the Commission has doubts that a market economy investor would have invested in a similar project given the possible transfer of the recovery obligation to Airport Handling and the lack of robustness of the projections made in the business plan underpinning SEA’s capital injection. If these doubts were confirmed, the capital injection would amount to state aid in favour of Airport Handling.

 

The Commission will now investigate both aspects to verify whether its concerns are confirmed.