(Reuters) - Brussels has warned British Airways owner IAG (ICAG.L) that its favored strategy to allow it to continue flying freely in and around Europe in the event of a no-deal Brexit will not work, the Financial Times reported on Tuesday.
After Brexit, European carriers will have to show they are more than 50 per cent EU-owned and controlled to retain flying rights in the bloc, the FT said.
IAG, which also owns the Spanish flag carrier Iberia, is registered in Spain but headquartered in the United Kingdom and has diverse global shareholders.
The FT said part of IAG’s strategy to retain both EU and UK operating rights is to stress that its important individual airlines are domestically owned through a series of trusts and companies, rather than being part of the bigger group comprising a high proportion of non-EU investors.
The FT quoted an unnamed senior EU official as saying, “For IAG, I can’t see how it can be a solution.”
Concerns have been raised with IAG over its post-Brexit ownership structure, the FT quoted a second Brussels official familiar with the conversations as saying.
IAG was not immediately available for comment.
Reporting by Rama Venkat in Bengaluru; Editing by Sonya Hepinstall