The European Commission (EC) rejected German state aid guarantees for DHL worth up to €500 milliongranted by the German state of Saxony for setting up DHL’s new hub at the Leipzig Halle airport,
according to media reports.The sum was promised to DHL and the airport in a letter issued by Saxony in case Leipzigairport was unable to meet conditions of the companies’ framework agreement.
The European Commission opened the state aid proceedings in November 2006, investigatingfinancial guarantees and the financing of a new southern runway at Leipzig/Halle supported bySaxony as the airport’s main shareholder.
Meanwhile, the EC approved the public investment of € 350 million for the construction of therunway but prohibited the guarantees which were made to DHL.
That state aid gave DHL an unfair advantage over its rivals as it would cover DHL’s businessrisk at terms that no private investor would accept, the EC said. Moreover, DHL has alreadyreceived the maximum of acceptable state subsidy and should return the sum received in excess ofthe legal norm to the state government, the regulator added.
Deutsche Post welcomed the decision on the contribution to the new runway and said it wasn’tconcerned about the decision on the guarantees as it would not negatively affect the routinebusiness of its air freight hub.
The business activities and the necessary investment security are backed up to a very largeextent through political and legal decisions, the company added.
CEO Frank Appel emphasized that Deutsche Post can live quite well with the commission’sdecision: “We have obtained in the meantime the long-term security that DHL urgently needs at theLeipzig location. After the conclusion of the last EU Commission’s proceedings we can really saythat we no longer see any restrictions from Brussels on the further operations of our expressbusiness at this important location.”
DHL further added that the limited reimbursement requirement had no consequence whatsoever onthe operational day-to-day business nor on DHL’s decision to operate the central European hub inLeipzig for the long term.
