The Cypriot Government suspended the national airline’s operations on January 9 after the European Commission ordered the flag carrier to pay back more than €65m received as part of a restructuring package in 2012 – 2013.
The airline issued the following statement:
“Following the adverse decision of the European Commission for Competition on the application of the Republic of Cyprus of a Restructuring Plan for Cyprus Airways (Public) Ltd submitted in October 2013, the Board of Directors of Cyprus Airways has decided to initiate the procedure for voluntary liquidation and to that effect all necessary measures will be taken.
“In the context of the above decision all operations of the company will be suspended as of the close of business today [January 9].
“Cyprus Airways would like to warmly thank the millions of passengers who flew with the airline over the years, for their choice and support. Special thanks are also expressed to the staff of the airline as well as its associates, whose professionalism and dedication were always at the service of the passengers.
“We are extremely honoured to have made a valuable contribution, over the last 68 years, to the development of the economy of Cyprus and its tourism industry in particular. We have flown the flag of our country worldwide with pride.
The government of Cyprus announced that it has decided to offer alternative arrangements to all passengers who have Cyprus Airways tickets. The cost of all alternative arrangements will be undertaken by the Republic.”
EU rules dictate that airlines can only receive State aid every ten years and Cyprus Airways was previously subsidised in 2007. Ina bid to raise extra funds the airline recently sold its last slots at Heathrow to American Airlines for $31m, and switched its London operations to Stansted.
After making its decision to order Cyprus Airways to repay the subsidies it has previously received the EU said the airline could not continue without state subsidies as its restructuring plan was based on “unrealistic assumptions.”