HOW TO SUPPORT THE DEVELOPMENT OF NEW ROUTES 161 3. REGIONAL SCHEMES TO DEVELOP AIR TRAFFIC In some cases, regional or local authorities are inclined to set up their own schemes to develop the air transport at the airports on their territories. For instance, the Region of Sardinia’s support scheme was declared an illegal and incompatible State aid to selected airlines operating at the Cagliari and Olbia airports by the European Commission in its decision of 29 July 201649. The regional scheme, which aims at increasing air traffic at the five Sardinian airports, provided for three measures: (i) Increase of air traffic by airlines as a Service of General Economic Interest (activity 1): airlines and airport operators define routes of strategic interest, qualified as SGEI (but not constituting PSOs) and set targets concerning flight frequency, capacity offer and the number of passengers. These annual plans of activities are subject to approval by the Region and if the targets are met, financial compensation is received, otherwise, the airline must pay penalties; (ii) Promotion of Sardinia as a touristic destination by airlines (activity 2): the plans of activities mentioned above should include marketing and advertising activities aimed at increasing the number of passengers and promoting the catchment area of the airport; and (iii) Further promotional activities entrusted by airport operators to third service providers other than airlines on behalf of the region (activity 3). In its analysis of the existence of an economic advantage, the Commission recalled that funding does not constitute an advantage if it is in compensation for a public service or if it complies to the MEOP. When reviewing the Sardinian scheme, the Commission first examined the nature of the funding and found that activities 1 and 2 are similar. The Commission also found that activity 2 subsidised the marketing costs that airlines should normally bear in the context of their air transport operations and that they cannot be qualified as the public purchase of marketing services and publicity: 49 Decision of 29 July 2016, Compensation to Sardinian airports for public service obligations (SGEI), SA33983, JO L 268 du 18.10.2017, pp. 1–79.
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