The High Court refused Ryanair Limited’s application to have its air travel tax case admitted to the Competition List, ruling that the issues in the pleadings did not concern the application of EU state aid rules.
Mr Justice Cooke delivered the ruling on 4 July 2013. Ryanair’s case challenges the validity and constitutionality of the provision that introduced the air travel tax, and alleges the tax was unlawful. It also seeks repayment of sums Ryanair says it was compelled to pay, along with damages for alleged breaches of constitutional and EU law. Those are claims in the proceedings, not findings by the court in this ruling.
The application relied on the State’s defence, which referred to a European Commission decision of 25 July 2012. The Commission had found that the lower rate of the tax amounted to incompatible state aid and required the State to recover it from beneficiaries. The State argued that Ryanair could not claim the benefit of that lower rate for journeys on which it had previously paid the normal rate, as that would amount to a further payment of aid already found unlawful.
The tax had a normal rate of €10 per passenger and a reduced rate of €2 for flights to destinations no more than 300 kilometres from Dublin Airport. The Commission decision treated the €8 difference as the aid to be recovered during the relevant period, before a common €3 rate was introduced.
Ryanair said its response would rely in part on pending annulment proceedings against the Commission decision and on a set-off it said it would claim in a separate recovery case brought by the Minister for Finance. It argued that resolving the present case in light of the State’s defence would require the court to consider how the state aid decision should be enforced.
Justice Cooke held that the High Court had no jurisdiction to determine whether the Commission decision was correct or valid; those issues belonged to the Court of Justice. He concluded that the arguments in this action might require consideration of the decision’s effects, but would not involve applying the state aid provisions themselves.
The court therefore refused admission to the Competition List. The ruling did not decide Ryanair’s underlying claims or the State’s defence, and did not prevent the case being heard at, after, or by the same court as the Minister’s recovery action if that later proved appropriate for efficient case management.