Critics over claims on Toulouse airport profit

The Cour des Comptes state auditors said the site – which Occitanie region claims is strategically vital because of its links to Airbus – has been left in the hands of an “unstable” board with links to the Chinese state.

It called for reforms in foreign investments, which has happened with privatisations at other airports such as Nice.

A spokesman for Toulouse airport, which has UK flights with Easy­Jet, Ryanair, British Airways and Flybe, said: “We have absolutely no comment to make.”

Attempts to speak to representatives of the Chinese shareholders also failed – not surprisingly, as even the Cour des Comptes was unable to find any physical trace of their holding company in France.

The French state sold a 49.9% stake in the airport to the Chinese consortium Casil Europe, which had bid €308million. It is made up of Shandong Hi-Speed, owned by the Chinese state, and British Virgin Islands firm Friedmann Pacific AG, which is owned and operated by a Hong Kong businessman.

The consortium committed to an option to buy the state’s last 10% of shares by April 2019, and joined it in a confidential shareholders’ pact.

However, local representatives on the 15-seat board were upset and wrote to the prime minister, asking the state not to sell its remaining shares. Last February the government cancelled the sale option and maintained a state interest in the airport, although details of the deal with Casil Europe remained secret.

The Cour des Comptes condemned this arrangement, saying governance was “unstable and ambiguous”.

The board has six Chinese members, two from the French state, four from Toulouse Chambre de Commerce (CCI), and one each from Toulouse Métropole, Haute-Garonne and Occitanie local authorities.

The councils and Toulouse CCI hold the remaining shares.

Difficulties started at the board’s first meeting as some Chinese directors did not speak French or English and the need for translation slowed progress.

But what most upset local representatives were the Chinese demands, backed by the French state, for big dividends, even if it meant raiding reserves.

In 2016 the Chinese wanted €40million in dividends from a net profit of around €10million.

After a boardroom battle, they accepted a €20million dividend, with €15million coming from reserves. In 2017 a similar battle resulted in a €7.8million dividend, with €1.5million from reserves.

Occitanie region president Carole Delga replied to questions with a statement emphasising the unique nature of Toulouse-Blagnac. She wrote: “It is used by Airbus, especially for all its test flights.

“It is thus a question of national sovereignty, and these are words not used lightly.

“It is not just a simple commercial airport like Nice. That is why it is essential that the state remains a shareholder in this airport, because there is a national dimension.

“Public shareholders must remain in the majority.”

Despite their criticism, the auditors recognised that revenue, profits and passenger numbers at the airport have soared as Casil Europe targeted more long-haul flights

The number of passengers has risen from 7.4million in 2014 to 9.2million in 2017, a 23% rise when overall French provincial air passenger numbers rose 15.9%. Overall sales figures are also up 10.5% to €142.3million in 2017.