European airport authorities subsidise Ryanair to the tune of at least €11 (£10) per passenger, Air France-KLM claimed today as it filed a lawsuit in Brussels against the low-cost carrier.

In the latest in a series of legal attacks on Ryanair's business model, the Franco-Dutch airline accused the Irish company of receiving illegal state aid and distorting competition.

Air France-KLM said that Ryanair obtained at least €660 million a year in financial incentives from regional authorities in Europe, notably in the form of reduced ground-handling fees and other airport charges.

"This is in direct violation of European rules," said Air France-KLM, which added: "In practice Ryanair is flying with the money of European taxpayers."

Air-France KLM said it had filed a lawsuit with the European Commission in November, arguing that Ryanair would have lost €829 million last year without the aid.

A spokesman for the Irish company, which is likely to carry more passengers than any other European airline this year, dismissed the accusations.

The spokesman said: "We pay no attention to false claims from high-fares, fuel-surcharging airlines like Air France. They can't compete with Ryanair so they complain instead. Ryanair is investing millions in regional French airports, whereas Air France ignores them."

He added: "It's Air France that is getting illegal aid in terms of reduced airport taxes on its domestic routes in France."

The row comes with the European Commission already investigating claims that Ryanair received illegal state aid in connection with the use of seven airports in Europe.

But the commission is likely to tread warily after its ruling that Ryanair should pay back subsidies in connection with Charleroi airport in Belgium was overturned by the European Court of First Instance.

Brussels dropped an inquiry into allegations that the Irish carrier received illegal state aid from officials in Bratislava last month.

At the heart of the row are the incentives that airports are prepared to offer in order to attract Ryanair flights.

Air France-KLM says that the subsidies to Ryanair from French airports vary between €9 per passenger and €32 per passenger.

The Franco-Dutch group describes as conservative its Europe-wide estimate of aid worth €11 per passenger.