In financing the state-owned airline Estonian Air, the government made a number of legal mistakes, which may lead to a negative decision by the European Commission, lawyers Carri Ginter and Kaspar Endrikson, from the law firm Sorainen, said.
The lawyers said the government did not consult the European Commission while giving aid to the troubled company and private investors were not brought in.
The two said similar problems could also plague Nordic Aviation Group, a company recently set up by the government to take over Estonian Air, if the Commission rules against it and Estonian Air is forced into bankruptcy.
“The question is whether the financing of the new company is thought through, if it is done under similar conditions to what a private company would do,” Endrikson said.
He said there should be no problems if the financing part is done in accordance with market conditions.
A decision by the Commission on whether funding by the Estonian state to Estonian Air, when the company was facing certain bankruptcy, is deemed legal or not, is expected to be made in the next few months.
Editor: J.M. Laats