Julian Moxon/PARIS Marco Messala/ROME
The European Commission(EC) is to decide on 11 February whether to open an investigation into allegations that Alitalia has broken the state aid deal agreed in July 1997.
EC transport commissioner Neil Kinnock has written to Italian minister for transport and navigation Claudio Burlando, demanding an explanation for what he calls "a breach of the clear and essential conditions" set out in the deal.
Several airlines, including Alpi Eagles, Air One, and British Airways, have complained that Alitalia has flouted agreements on seat pricing. Alitalia had agreed not to act as a "price leader", undercutting competitor's fares to win market share. There are also allegations that Alitalia has not kept promises to provide documentation on the profitability of its routes. Alitalia denies the charges.
Further complaints have been aimed at the Italian Government, which has been requested to end the practice of granting its flag carrier preferential status in slot allocation for key airports and routes. The presence of a senior transport ministry official on the carrier's board may also be breaching the rule on government interference.
The EC could block the second L500 billion ($280 million) tranche of state aid, due to be paid in May, pending a complete reopening of the state aid investigation. The final L250 billion of L2,750 billion is due a year later.
Kinnock says that Alitalia has failed to respond to "letters, contacts and discussions".
Source: Flight International
