State Aid SA.60113 (2021/N) – Finland – COVID-19 Aid to Finnair

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State Aid SA.60113 (2021/N) – Finland – COVID-19 Aid to Finnair EUROPEAN COMMISSION Brussels, 12.3.2021 C(2021) 1788 final In the published version of this decision, some PUBLIC VERSION information has been omitted, pursuant to articles 30 and 31 of Council Regulation (EU) This document is made available for 2015/1589 of 13 July 2015 laying down information purposes only. detailed rules for the application of Article 108 of the Treaty on the Functioning of the European Union, concerning non-disclosure of information covered by professional secrecy. The omissions are shown thus […] Subject: State Aid SA.60113 (2021/N) – Finland – COVID-19 aid to Finnair Excellency, 1. PROCEDURE (1) By electronic notification of 17 February 20211, Finland notified aid to Finnair plc (“Finnair”) in the form of a EUR 351.38 million hybrid loan (“the Measure”), in accordance with Article 108(3) of the Treaty on the Functioning of the European Union (“TFEU”). (2) Finland exceptionally agrees to waive its rights deriving from Article 342 TFEU, in conjunction with Article 3 of Regulation 1/1958,2 and to have the present decision notified and adopted in English. 1 The Finnish authorities pre-notified the Measure on 8 December 2020. The Finnish authorities and the Commission services held several conference calls throughout the pre-notification procedure. The Commission send requests for information on 11 and 21 December 2020; on 12, 18 and 28 January 2020, and on 2 and 15 February 2020. The Finnish authorities submitted information on 14, 16 and 23 December 2020; on 8, 12, 18, 26 and 28 January 2021 as well as on 2, 16 and 17 February 2021. 2 Regulation No 1 determining the languages to be used by the European Economic Community, OJ 17, 6.10.1958, p. 385. Ulkoministeri Pekka HAAVISTO Merikasarmi PL 176 FIN - 00161 Helsinki Commission européenne/Europese Commissie, 1049 Bruxelles/Brussel, BELGIQUE/BELGIË - Tel. +32 22991111 2. DESCRIPTION OF THE MEASURE 2.1. Objective of the Measure (3) Finland considers that the COVID-19 outbreak, i.e., the pandemic caused by infections with the new coronavirus SARS-CoV-2, and the related governmental restrictions severely affected the aviation sector in that Member State. In that context, the Measure seeks to make good the damage that Finnair suffered due to the imposition of travel restrictions and other containment measures linked to the COVID-19 outbreak in place between 16 March and 31 December 2020 (the “Overall Compensation Period”). (4) In particular, the Measure aims at compensating the losses suffered by Finnair: - between 16 March and 30 June 2020 (the “First Compensation Period”) due to the general travel restrictions and containment measures adopted at domestic, Union and international levels; and - between 1 July and 31 December 2020 (the “Second Compensation Period”) due to persisting or new travel restrictions on routes operated or programmed by Finnair in 2020 to/from the following countries: Portugal, Spain, France, the United Kingdom, Croatia, Czechia, Hungary3, the United States of America (“USA”), Turkey, Israel, Japan, India, Singapore, Thailand4, Hong Kong and China. (5) Finland notified the Measure under Article 107(2)(b) TFEU. 2.1.1. Travel restrictions linked to the COVID-19 outbreak during the Overall Compensation Period (6) The COVID-19 outbreak has resulted in travel restrictions imposed by Member States and third countries and the closing down of the vast majority of passenger air transport domestically, within the Union and globally. Travel restrictions adopted by Finland on travels to/from abroad (7) On 12 March 2020, the Finnish government adopted the first general restrictions to contain the spread of the COVID-19 outbreak. Until further notice, all public events with more than 500 attendees were cancelled; employees were advised to work remotely if their tasks could be carried out from home; citizens were advised to discontinue non-essential work-related travel and to postpone holiday travel; all non- essential activities were restricted5. On 14 March 2020, the Finnish Ministry of Foreign Affairs announced the closure of the Finnish borders with effect as of 19 3 Only for the period 1 September – 31 December 2020. 4 Only for the period 1 July – 31 August 2020. 5 See press release of the Finnish Government of 12 March 2020: https://valtioneuvosto.fi/en/- /10616/government-decides-on-recommendations-to-curb-the-spread-of-coronavirus. 2 March 2020 and issued a warning inviting all Finnish citizens travelling abroad to return immediately to Finland6. (8) On 16 March 2020, the Finnish government declared a state of emergency and adopted the first travel restrictions concerning travel from/to all of the Member States as well as third countries. The public authorities suspended all passenger transport to Finland with the exception of returning Finnish citizens and persons residing in Finland7. As of 27 March 2020, the Government decided to restrict traffic between the capital region and other regions in Finland. The first travel restrictions, which had covered an initial period until 13 April 2020, were later tightened8 and were prolonged until 13 May 20209. During that period travel was reduced to essential traffic based on a list of critical occupations introduced by the Ministry of Economic Affairs and Employment. The tasks listed as justified essential traffic were those that were characterised as critical to the security of the supply chain or for specific industries. (9) On 14 May 2020, the Finnish government allowed travels from/to the Schengen area for essential reasons, including essential business travel for people having an employment contract in Finland. At the same time border controls were prolonged for all internal (Schengen countries) and external (non-Schengen countries) borders until 14 June 2020. On 29 May 2020, the Finnish government started to ease the restrictions on domestic travels10 and the internal lockdown restrictions. (10) On 11 June 2020, the Finnish government outlined the future new rules for travel restrictions, following a strategy aiming at a gradual lifting of travel restrictions based on the continuous monitoring of the COVID-19 epidemiological situation. (11) As a result, the Finnish government first allowed cross-border traffic with countries with similar epidemiological situations as Finland11. On 15 June 2020, Finland lifted all travel restrictions with Estonia, Iceland, Latvia, Lithuania, Norway and Denmark12. 6 See press release of the Finnish Ministry of Foreign Affaires of 14 March 2020: https://valtioneuvosto.fi/en/-/ulkoministerio-ala-matkusta-ulkomaill-2. 7 See press release of the Finnish government of 16 March 2020: https://valtioneuvosto.fi/en/-/10616/hallitus- totesi-suomen-olevan-poikkeusoloissa-koronavirustilanteen-vuoksi. The Finnish government applied a full prohibition of all travels starting as of 18 March 2020 for all transports (https://valtioneuvosto.fi/en/- /1410869/suomen-rajaliikennetta-aletaan-rajoittaa-elakkeella-olevia-rajavartijoita-ja-poliiseja-voidaan- kutsua-toihin). 8 See press release of the Ministry of Interior of 7 April 2020: https://valtioneuvosto.fi/en/-/1410869/suomen- rajaliikenteen-rajoituksia-jatketaan-ja-karanteenimaarayksia-tiukennetaan. 9 See press release of the Finnish government of 30 March 2020: https://valtioneuvosto.fi/en/-/10616/hallitus- jatkaa-poikkeusoloihin-liittyvia-toimia-13-toukokuuta-saakka. 10 See press release of the Finnish government of 29 May 2020: https://valtioneuvosto.fi/en/-/10616/hallitus- linjasi-kotimaassa-voi-matkailla-kun-noudattaa-terveys-ja-turvallisuusohjeita. 11 See press release of the Ministry of Interior of 12 June 2020: https://valtioneuvosto.fi/en/- /1410869/valtioneuvoston-paatos-rajaliikenteen-rajoituksista-15-6-alkaen. 12 However, Denmark and Iceland continued to maintain restrictions on entry from foreign countries respectively until 27 June 2020 and 1 July 2020 (see https://www.schengenvisainfo.com/news/denmark-to- reopen-for-majority-of-european-countries/ and https://www.government.is/news/article/2020/06/12/Changes-in-travel-restrictions-untill-1-July/). 3 Non-essential travels to/from all other Member States and Schengen Associated States13, as well as all travels to/from third countries, remained prohibited14. All incoming travellers from countries subject to the Finnish travel restrictions had to undergo a quarantine period of 14 days upon arrival in Finland15. In addition, the Finnish authorities recommended Finnish citizens and residents in Finland to avoid non-essential travels abroad except for the countries for which no travel restrictions applied. (12) On 8 July 202016, the Finnish authorities decided to lift as of 13 July 2020 the restrictions on traffic to all Member States and Schengen Associated States that registered no more than eight new cases of the disease per 100,000 persons in the previous 14 days17. On that basis, on 13 July 2020, Finland lifted all travel restrictions from/to the Netherlands, Belgium, Italy, Austria, Greece, Liechtenstein, Malta, Germany, Slovenia, Slovakia, Switzerland and Hungary, but left in place the existing travel restrictions for the rest of the Member States and Schengen Associated States (i.e., prohibition of non-essential travels). For third countries, Finland maintained the prohibition on all travels with the exception of the countries figuring in Annex I to the Council Recommendation on the temporary restriction on non-essential travel into the EU and the possible lifting of such restriction18. Regarding those exempted countries the Finnish authorities only allowed
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