Bristol Airport Challenges Cardiff's £205M Subsidy, Citing Competition Breach

The future of a significant Welsh government investment in Cardiff Airport is now subject to a major legal review.

Bristol Airport has launched a legal challenge against the planned £205.2 million subsidy. The case is being heard by the Competition Appeal Tribunal (CAT). Lawyers for the privately-owned Bristol Airport argue the £205 million funding package is unprecedented in UK aviation. They claim it constitutes a breach of national UK aviation competition rules. The two-day hearing began on Monday, February 9, 2026, with a panel chaired by Ben Tidswell.

The Subsidy Under Scrutiny

The Welsh government, which has owned Cardiff Airport since 2013, officially awarded the subsidy in April 2025. The total £205 million funding is set to be phased over a 10-year period. Ministers have defended the plan, stating it will support the airport’s long-term prosperity.

The subsidy is intended to fund several key areas. These include developing new maintenance facilities and hangars. It also aims to boost air cargo capacity. The government plans to develop new air routes, focusing on global aviation hubs. This strategy is designed to support wider aviation economic growth in Wales.

Bristol Airport filed its appeal with the CAT in July 2025. The airport's management believes the investment is disproportionate. They calculate the subsidy at approximately £71.50 per passenger. Bristol argues this means the taxpayer is effectively paying for people to go on holiday from Cardiff Airport.

First Test of the Subsidy Control Act

This dispute marks a significant moment for the industry. It is the first challenge concerning an airport or airline under the Subsidy Control Act 2022 since it took effect in January 2023. This makes the case a crucial test for the UK’s post-Brexit state aid regime. The CAT will scrutinize how the Welsh government applied the subsidy control principles.

Bristol Airport's legal arguments are based on four main grounds. A core claim is the failure to assess Cardiff Airport as an "ailing or insolvent enterprise." This legal category would have required additional steps. Specifically, it would have triggered extra checks related to rescue or restructuring aid.

Furthermore, Bristol Airport argues the subsidy fails to meet conditions in Section 28 of the Act. This section places a conditional prohibition on subsidies awarded to "air carriers for the operation of routes." Bristol believes elements of the funding package may constitute illegal aid to airlines.

The Competition Impact

Bristol Airport, located just across the Severn Estuary, is Cardiff’s closest commercial rival. The airport contends that the large-scale public funding package will draw away passengers and airlines. They claim this will happen through anti-competitive means.

The competitive threat is significant for Bristol Airport. The Welsh government’s own impact assessment noted the risk. Approximately 20% of Bristol Airport’s passengers originate from Wales. This figure is noteworthy, as it is higher than Cardiff Airport’s total passenger numbers. In 2025, Bristol served 10.8 million passengers, while Cardiff served just under one million.

Bristol Airport stated ahead of the hearing that the subsidy "was unlawful, disproportionate, and would unfairly harm airport subsidy control and airline competition." They are asking the tribunal to quash the subsidy decision.

Welsh Government Defense

The Welsh government investment is being strongly defended by ministers. They maintain the airport is a vital part of the nation's economic infrastructure. The airport supports thousands of jobs and generates significant economic activity.

A spokesperson for the government confirmed they would present their position through the proper legal process. They previously stated a commitment to "fight for our ability to invest" in Cardiff Airport’s long-term prosperity.

The outcome of this case will be a defining moment. It will set a precedent for how the Subsidy Control Act 2022 is applied to regional airports. The tribunal is expected to defer its final decision until a later date. This leaves the future of the Cardiff Airport subsidy and the regional UK aviation competition landscape uncertain. The ruling will determine the limits of public funding for commercial aviation entities.

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