Flight Mode: Bristol Airport Challenges Cardiff Airport Subsidy

Bristol Airport has appealed a decision to grant subsidy worth over £200m to Cardiff International Airport.

Flight Mode: Bristol Airport Challenges Cardiff Airport Subsidy

On 20 June 2025, Bristol Airport Limited ("Bristol Airport") submitted an appeal under section 70 of the Subsidy Control Act 2022 (the "Act"), challenging the Welsh Government's decision to grant a subsidy package of up to £205.2 million on a phased basis over ten years to Cardiff International Airport Limited ("CIAL"). Section 70(1) of the Act provides that: "an interested party who is aggrieved by the making of a subsidy decision may apply to the Competition Appeal Tribunal for a review of the decision". The Registrar of the Competition Appeal Tribunal ("CAT") gave notice of the receipt of the appeal on 22 July 2025.

Background of the Subsidy

According to the notice of appeal, CIAL, established in 1952 and privatised in 1995, was acquired by the Welsh Government in 2013. Since then, the Welsh Government has invested approximately £179.6 million in CIAL through acquisition costs, equity investment, loans, and grants.

In late 2023, the Welsh Government confirmed its intention to provide ongoing, scalable financial support to CIAL. This approach was publicly announced in July 2024, followed by a request to the Competition and Markets Authority's Subsidy Advice Unit ("SAU") for a report, as required by the Act, as the subsidy is a "Subsidy of Particular Interest".

The SAU's non-binding report, published in October 2024, recommended clarifications regarding the subsidy's counterfactual, evidence that the costs covered are additional, proportionality of the subsidy, and a more comprehensive assessment of potential competition and investment impacts.

Following this, the Welsh Government prepared further evidence and revised its subsidy control assessment, and the subsidy was formally awarded in April 2025, with its stated objective as follows:

"the overarching objective is to address inequality in the Welsh economy compared to the rest of the UK by growing the aviation sector and aerospace businesses with [CIAL] at the centre, as aligned with the [Welsh Government] key priorities and economic policy objectives for [CIAL]. The specific policy objective to address the equity issues [...] is to grow the regional economic activity associated with [CIAL] and maximise the potential agglomeration benefits linked with the wider aviation and aerospace sectors in the region."

Bristol Airport's Grounds for Appeal

Bristol Airport, which serves 10 million passengers annually, approximately 20% of whom are from South Wales, argues that in making its decision to give the subsidy package the Welsh Government has erred in fact and/or law by:

• Ground 1: Failing to determine that CIAL qualified as an "ailing or insolvent enterprise" under section 24 of the Act.
• Ground 2: Failing to recognise the subsidy as one for rescue or restructuring, and therefore not complying with sections 19 and/or 20 of the Act.
• Ground 3: Further or alternatively, failing to properly apply the subsidy control principles in Schedule 1 of the Act and wrongly concluding the subsidy was lawful.
• Ground 4: Further or alternatively, failing to properly apply section 28 of the Act where parts of the subsidy may qualify as support for air carriers operating air routes.

Welsh Government's Position

The Welsh Government has indicated its intention to defend the subsidy decision. In a written statement dated 9 July 2025, Rebecca Evans, MS Cabinet Secretary for Economy, Energy and Planning, confirmed that the Welsh Government had received notice of the legal challenge. She stated that £20 million of the subsidy has been provided to CIAL for the current financial year. She also reaffirmed CIAL's importance to the South Wales economy and stated that normal operations at the airport would continue during the legal proceedings.

Next Steps

According to the Order of the Chair (Directions to Trial), the hearing of the appeal in the CAT is currently scheduled to take place in the week of 9 February 2026, with a time estimate of two days. A confidentiality ring has also been agreed between the parties to protect certain commercially sensitive and confidential material. The first case management conference was due to take place on 22 July 2025 but was vacated by consent.

For further details, the full Summary of Appeal is available on the CAT website and can be found here.