BA ready to fight EU block

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The Independent Online
BRITISH AIRWAYS is heading for a confrontation with the European Commission over plans by Air France to ban foreign rivals from running long-haul flights out of Orly airport in Paris.

BA, whose new partner American Airlines flies to the United States from Orly, has accused French authorities of protectionism. BA's French subsidiary, Air Liberte, has asked Neil Kinnock, the European Transport Commissioner, to intervene.

But last night it appeared the French are to get a clear run in banning carriers which wish to fly more than 3,000 miles from Orly.

A senior European Commission source told the Independent on Sunday it had no plans to block the proposals outlined by the French Transport Ministry, which owns Air France. The Commission believes the long-haul ban is not anti-competitive, because it will affect all EU member states equally. That it would severely disrupt the transatlantic schedule of BA's American partner has apparently not cut any ice in Brussels.

"Our rules are not designed to protect US airlines but to ensure equality and a level playing field between European ones," said the commission source.

Aeroports de Paris, the operator of Orly airport, is due to discuss the measures later this month. But they have caused widespread anger among French unions, which fear job losses if long-haul flights go, and howls of protest from Air France's rivals. They say Air France, which will retain the right to fly long-haul to French territories, is being shored up with anti-competitive measures to protect it before its proposed sale next year. Air Liberte has threatened to take legal action in French and European courts.

Last night, a British Airways spokesman said: "Any forced distortion of the market place can only harm the consumer's ability to choose what is appropriate for their travel needs."

If the Orly move goes ahead unopposed, it will be another blow to BA's global ambitions, which have effectively been on hold since it announced the link-up with American Airlines more than two years ago.

The airline has been told it can proceed with the deal, but Karel Van Miert, the European Competition Commissioner, has said that BA must relinquish 267 lucrative weekly take-off and landing slots at Heathrow and Gatwick to allow rivals to compete.

The airline believes the slots are worth at least pounds 500m, and wants to sell them to the highest bidder, but Mr Miert and John Prescott, the Deputy Prime Minister, have said the slots are not for auction. Britain is still bound by an EU regulation, imposed in 1993, which decides allocations of slots.

Peter Mandelson, the Secretary of State for Trade and Industry, is expected to rule on the crucial slots issue by the end of November. But if he grants BA the right to sell them, Mr Van Miert could challenge his decision in the European Court.

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