How it flew on the wings of the state: What will happen to the flights of low-budget airlines

The Ministry of Capital Investments asked the Agency for Protection of Competition to state whether the granting of subsidies to low-budget airlines Ryanair, Izidjet and Wizz Air distorted competition in air transport.

Enable cheaper flights for citizens: Illustration, Photo: Airports of Montenegro

The Ministry of Capital Investments (MKI) asked the Agency for Protection of Competition (KPA) to state whether giving subsidies to low-budget airlines distorted competition in air transport, “Vijesti” has learned from several sources in the executive branch and the transport sector.

These are the Irish company Ryan Air, the British EasyJet and the Hungarian Wizz Air.

According to Vijesti, the money was paid to these companies in the period from 2013 to 2020 from the state budget, the Airport of Montenegro (ACG) and the National Tourist Organization (NTO), and the contracts concluded by the state with them expired. .

Silence

“Vijesti” asked MIK, led by Mladen Bojanic, whether the contracts with these three low-budget airlines have expired, if so, when and whether they will be renewed.

Questions for this Government department are whether the policy of subsidies for low-budget companies will be continued and whether they believe that they are necessary for the promotion of Montenegro as a tourist destination, but instead of answers, an explanation was sent to the Ministry of Economic Development (MED). now the tourism sector as subsidies were granted by the former Ministry of Tourism and the NTO.

The MED, led by Minister Jakov Milatovic, did not answer the same questions.

It was explained that they are currently unable to respond.

The two departments were also asked to submit data on how much money was paid to low-budget companies in the last seven years on the basis of subsidies (period from 2013 to 2020).

The questions of “Vijesti” on how much money they gave to low-budget airlines were not answered even from ACG and NTO.

Letters

In the middle of last month, the department headed by Bojanic sent a letter to KPA regarding this issue, which “Vijesti” has access to.

“Did the Agency comment on the benefits and subsidies that the former Ministry of Sustainable Development and Tourism, ACG and NTO provided and paid on the domestic market to low-cost airlines – Ryanair, Izidjet and Wizzer in the period from 2013 to 2020?” .

Has the granting of these subsidies, especially in the period from 2014 to 2020, distorted competition in air transport “, reads the letter from the ministry in whose jurisdiction the transport sector is.

An examination procedure has not yet been formed in the KPA, and according to the information from “Vijesti”, documentation is being collected from the ACG, NTO and MED.

One of the letters sent to ACG, which “Vijesti” has access to, states that the Agency examines available data and information ex officio due to suspicion that illegal state aid was granted, ie aid that was granted without prior notification or before the Agency’s decision. on the compliance of that assistance with the Law on Granting State Aid.

“You need to state whether in the period from 2013 to 2020 you granted subsidies to low-cost airlines in terms of the definition of state aid and to submit all evidence and information to the Agency,” reads the letter sent to ACG.

For 7 years, three low-budget airlines received subsidies from the state

The national airline Montenegro Airlines (MA) landed its planes at the end of last year due to the difficult finances of the situation in which it found itself. The government has not been allowed to help him since September.

According to the announcement of the executive director Predrag Todorović, the new state airline “To Montenegro” should start flying by the beginning of the summer tourist season.

For now, he did not know which slots he would have, and it was announced that he would operate according to market principles.

Numerous benefits from the entry of low-cost airlines

Montenegro’s air availability until 2013 was mainly based on the operations of commercial airlines and charter airlines that operated flights mainly for several months during the summer tourist season.

Thanks to the entry of low-budget airlines, the country was connected to European cities throughout the year.

The list of cities with which the country is connected includes Barcelona, ​​Bologna, Stuttgart, Berlin, Brussels, London, Stockholm, Milan, Munich, Budapest, Katowice, Warsaw…

The airports in Podgorica and Tivat also benefited from low-budget airlines because they increased traffic, encouraged the development of the Montenegrin tourist economy, extended the season, marketing visibility of Montenegro, and cheap air tickets were available to citizens…