EU clears restructuring aid for Portuguese airline TAP

BRUSSELS (Reuters) – The European Commission said on Tuesday it had approved a 2.55 billion euro ($2.87 billion) Portuguese restructuring aid plan for TAP, along with 107.1 million euros to compensate the airline for damages suffered due to the COVID-19 pandemic.

Portugal notified the Commission, which oversees competition policy in the European Union, in June 2021 of its plans to offer the aid. The Commission opened an in-depth investigation into the matter in July.

European Competition Commissioner Margrethe Vestager said the measures would enable Portugal to compensate TAP for damages suffered from travel restrictions, with a restructuring plan to ensure the airline’s path towards long-term viability.

Safeguards to limit distortions to competition include TAP’s commitment to make available slots at Lisbon airport.

“This gives competing carriers the chance to expand their activities at this airport, ensuring fair prices and increased choice for European consumers,” Vestager said in a statement.

The 107.1 million euro compensation covers the period from July 1 to December 30, 2020.

($1 = 0.8875 euros)

(Reporting by Philip Blenkinsop)