Brussels Threatens The Federal Government

The federal government saved Lufthansa last year with a package worth billions. According to a media report, the EU Commission is now criticizing the airline’s violations of conditions – and is therefore threatening Berlin. The EU Commission has apparently threatened the German government with infringement proceedings because of the billion-dollar Lufthansa rescue.

As the “Spiegel” reports, EU competition commissioner Margrethe Vestager sees massive problems in connection with the support of the largest German airline.

She told Vice Chancellor Olaf Scholz and Federal Minister of Economics Peter Altmaier two weeks ago in a confidential video conversation. According to the media report, Vestager’s criticism is sparked by two incidents: Lufthansa boss Carsten Spohr and his fellow board members had interest of around  February 12 25 million euros paid out to the creditors of a long-term hybrid bond without informing Brussels beforehand. According to Vestager, the airline violated the state aid requirements for state loans.

According to the report, the commissioner is also angry about Lufthansa‘s dealings with competitor Condor. Lufthansa had canceled various feeder flights to the traffic hubs in Frankfurt and Munich for its former in June this year – wrongly according to Vestager.

Lufthansa considers criticism to be unfounded. According to “Spiegel” information, Vestager threatened the federal government that it would seek infringement proceedings against the Federal Republic if Berlin did not stop Lufthansa’s actions. At the end of such a procedure, in the worst case scenario, the aid money granted would have to be repaid. According to the report, Lufthansa management defended itself in a statement to the federal government. The punctual interest payment was necessary in order not to unsettle the capital markets. The fact that one wants to cancel the Condor feeder flights has nothing to do with the Corona crisis. Rather, they want to get more involved in business with holiday travelers. Alternatively, Condor could offer its own feeder flights or use the train to transport its customers to Frankfurt.

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