EU states likely to be allowed to offer state aid to airlines

The European Commission says the grounding on planes caused by the volcanic ash cloud could have cost Europe's aviation industry more than £2bn, the Telegraph reports.

The EC said it was inclined to ease state aid rules to help the industry recover. European governments will also be allowed temporarily to ease flight restrictions and to defer route charges to help airlines grounded by the disruption cope with cash-flow problems.

Back to normal

Siim Kallas, transport commissioner, said yesterday: "Now, as we are getting back to normal, our focus can shift to relief measures for the industry. This is about practical measures to provide relief to the air transport sector so they can weather this crisis.

"We have taken all assessments and valuations of costs from all the different stakeholders and we are working with a number between €1.5bn and €2.5bn (£1.30bn to 2.17bn)."

Kallas added that the EU executive will soon come forward with guidelines on how countries can give state aid to airlines without offering any carriers "unfair" assistance.

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