Aer Lingus Heathrow ceasefire
Published 08/06/2015 | 02:30
Aer Lingus has called a ceasefire with the European Commission in a legal battle regarding the awarding of take-off and landing slots at Heathrow Airport.
Next month, the European Court of Justice was due to hear a case that was being taken by the airline against the Commission.
Aer Lingus initiated the action in 2013 following a 2012 decision by the European Commission to award Virgin Atlantic coveted Heathrow slots that British Airways owner IAG was being forced to divest as part of conditions attached to its takeover of BMI, formerly known as British Midland. The slots had to be awarded to an airline unconnected with IAG.
But with Aer Lingus now a subject of a €1.4bn takeover offer from IAG, the legal action against the Commission has effectively been suspended.
IAG bought BMI from Lufthansa. The European Commission said that IAG would have to yield 12 pairs of slots at Heathrow as one of the conditions for being allowed buy BMI.
Aer Lingus was interested in acquiring some of those slots but Virgin succeeded securing all of them following a European Commission decision. Virgin had argued that all the slots needed to be handed over to one operator so a credible challenge could be mounted against British Airways.
Seven of the slot pairs had to be used to fly between Heathrow and Edinburgh or Aberdeen. Five had to be used between Heathrow and Nice, Cairo, Riyadh, Moscow, Edinburgh and, or, Aberdeen.
Aer Lingus had been interested in the slots that would have been used to fly between Heathrow and Edinburgh.
It launched a court case against the decision in 2013. It has argued that the Heathrow-Edinburgh slots being reallocated were only meant to be used to connect passengers to third-party carriers, while Virgin was connecting them to its own flights.
Aer Lingus has also claimed that the European Commission failed to take account of advice from a monitoring trustee in relation to four main issues, including what the airline says were Aer Lingus’ advantages in respect of operating costs and interlining.
Ironically, despite losing out, Aer Lingus signed a so-called wet-lease agreement with Virgin Atlantic, operating Virgin's ‘Little Red’ domestic UK service in return for a fixed fee. Last year, Virgin announced that it's scrapping Little Red.