Ryanair challenge to PSO award rejected

A challenge by Ryanair to the decision by the Minister for Transport to award the Dublin - Knock PSO route to Aer Arann has been dismissed on all grounds in the commercial court. When the route came up for renewal last year CityJet and Aer Arann submitted tenders with the former being awarded the route until 2011. CityJet's plan hinged upon the VLM / CityJet merger being approved in the UK which would have freed up the necessary aircraft to operate the route. The merger was not initially approved however and was referred to the Competition Commission which took several months to review the case. The delay forced CityJet to withdraw from the route before it was started. As a result, the Minister for transport entered talks with Aer Arann which resulted in Aer Arann being awarded the route from October 2008 to July 2011. Ryanair had not expressed any interest in operating the route until CityJet withdrew and subsequently challenged the Minister's decision on several grounds, including seeking an order to compel the Minister to retender for the route and prevent payment of €71,000 for the month of October on the grounds of short notice for commencement of the route.

In the Commercial Court yesterday Ryanair's challenges were rejected in a reserved judgement by Ms Justice Finlay Geoghan.

The judge ruled that on the withdrawal of CityJet that the Minister was entitled to open discussions with Aer Arann on the basis that Aer Arann were the next preferred tenderer. In relation to the payment of the sum for October, the judge ruled that the Minister was entitle dot make the payment.

Posted 090402