MyTravel to sue European Commission
MyTravel has confirmed it is to sue the European Commission for more than half a billion pounds for putting a stop to its proposed takeover of First Choice in 1999.
As previously reported by TravelMole the travel giant decided to make the move after the European Court of Justice ruled that the proposed merger between Airtours (now MyTravel) and First Choice had been unlawfully blocked by the EC.
MyTravel is now claiming GBP518 million in damages comprising three years’ worth of lost profits, the loss of GBP35 million in cost savings, and GBP10 million in wasted costs on the intended takeover.
If MyTravel wins, it will be the first time a company has successfully sued a European member state. The EC initially blocked the deal because it said it would lead to three operators having “collective dominance of the market”, the other two operators being Thomas Cook and Thomson (now TUI).
One top competition lawyer told The Independent: “The Commission has been burned and rightly so for man-handling the case. It is a warning shot across their bows to be straighter in their approval or risk being out of pocket.” Another added: “Given the biting criticism of the ruling there is clearly a case worth arguing. It is a high hurdle to get damages from the commission but not an impossible one.”
A spokesman for the EC said: “The Commission believes it is not liable for the alleged damages and that the court will conclude the action must be rejected.”
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