Economy airline Ryanair turned to the Competition Authority last year to challenge Tallinn Airport's fees hike before deciding to cut destinations from Tallinn.
Ryanair said on Wednesday it would cut seven destinations from Tallinn. Tallinn Airport CFO Eero Pärgmäe suggested the airline's decision followed a looming airport fee hike and fierce competition.
Minister of Economic Affairs and Communications Riina Sikkut (SDE) said that expectations for the state-owned airport have not changed and ensuring advantageous air links from Tallinn remains its priority. But the owner's expectations also include profitable and effective operation.
"Clearly, it is difficult to serve both short and long-term goals – growing the number of destinations and departures requires sustainable ways of covering costs. Tallinn Airport has said that it has not hiked the fees for around ten years, which now fall short of those charged at nearby airports," Sikkut said.
Tallinn Airport's 2022 financials have not been authorized. The first nine months' net profit was €8.6 million, up from €2.5 million a year ago. The airport's net profit was €9 million in 2019, before the Covid pandemic.
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Sikkut said that the fee hike was in preparation for a long time, and that Ryanair is the only operator to have contested it.
Pärgmäe said on Wednesday that consultations were launched last summer to hike the fee by 30 percent on average.
"What is more, the fee hike would not apply to Ryanair flights from Tallinn to Billund, Nuremberg and other destinations, and the company has been so far been given a discount based on passenger volume, which would have continued. Therefore, the airline's decision follows several considerations and is not tied just to fee rates," the economy minister remarked.
The Competition Authority does not govern or coordinate airport fees, while it is in charge of supervision proceedings.
The agency's regulation service head Marek Piiroja said that the Competition Authority is conducting supervision proceedings, with their deadline in April.
"In its decision, the authority will designate whether the fee hike was partially or fully justified, after which Tallinn Airport AS will publish the new fees on its website and can apply them two weeks later," Piiroja said.
Editor: Karin Koppel, Barbara Oja, Marcus Turovski