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Published on Thursday, January 16, 2020

IAG submits complaint to the EU over Flybe rescue plan

IAG has submitted a complaint to the EU Competition directorate about the 'state aid' given to Flybe.

It comes after the airline group's outgoing chief executive, Willie Walsh, wrote to the UK's transport secretary Grant Shapps calling the government's rescue of Flybe a 'blatant misuse of public funds'.

Walsh said the taxpayer was picking up the tab for the mismanagement of the airline.

The terms of the deal were not disclosed but it is believed Flybe was granted a three-month extension to pay its Air Passenger Duty bill of around £100 million, plus a possible government loan and a cash injection from investors.

The Government said there will also be a review in the March Budget of the way APD is applied to domestic flights.


Flybe was sold last year to a consortium led by Virgin Atlantic for £2.2 million. They are understood to have promised to pump £100 million of fresh equity into the airline if the government agreed a plan to ease its immediate cashflow crisis.


EasyJet and Ryanair have also voiced their opposition to the government's actions.


EasyJet chief executive Johan Lundgren said: "Taxpayers should not be used to bail out individual companies, especially when they are backed by well-funded businesses."


Ryanair called for more 'robust and frequent stress tests on financially weak airlines and tour operators so the taxpayer does not have to bail them out'.



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