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British Airways owner files complaint over Government's decision to rescue Flybe from collapse

Evening Standard logo Evening Standard 15/01/2020
a large air plane on a runway: The troubled regional airline was bought in January after suffering financial difficulties (PA) © Provided by Evening Standard The troubled regional airline was bought in January after suffering financial difficulties (PA)

The owner of British Airways and Aer Lingus has filed a complaint over the Government's decision to rescue Flybe from collapse.

International Airlines Group has told the European Commission that the move breaches state aid rules and gives the struggling airline an unfair advantage.

The airline's collapse was averted after the Government said it would review air passenger duty (APD) for the company and shareholders agreed to inject additional investment.

The Treasury announced on Tuesday evening the loss-making carrier would continue operating after the review of the tax featured in rescue talks.

BA said the move breaches state aid rules and gives the struggling airline an unfair advantage © Getty BA said the move breaches state aid rules and gives the struggling airline an unfair advantage

Campaigners warned Boris Johnson that any APD review that leads to cheaper air travel would be a "complete scandal" and "rip up" the Prime Minister's pledge to show leadership on the climate crisis.

Flybe's shareholders agreed to a cash injection - understood to be in the region on tens of millions of pounds - to keep Europe's largest regional carrier in business "alongside Government initiatives".

The airline would not comment when asked if the Treasury had separately agreed to the deferral of a portion of the airline's outstanding tax bill over a period of months.

The emergency agreement seeks to prevent Flybe becoming the second UK carrier to fail in four months after Thomas Cook went bust in September.

Gallery: What it's like to travel on Flybe, the budget airline used by the royals (INSIDER)

The Treasury said the APD review ahead of the March Budget would consider the UK's climate commitments to meet net zero greenhouse gas emissions by 2050.

Flybe chief executive Mark Anderson welcomed the deal as a "positive outcome for the UK" which "will allow us to focus on delivering for our customers and planning for the future".​

Greenpeace UK policy director Dr Doug Parr has said any cuts to APD was a "poorly thought-out policy that should be immediately grounded".

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