Jan. 15 (UPI) -- The parent company of British Airways said Wednesday it has filed a complaint with the European Union over a bailout provided by the British government to struggling competitor Flybe.
International Airlines Group, owner of British Airways, confirmed it had lodged a complaint with the EU's competition directorate after IAG CEO Willy Walsh had called the bailout of the struggling company a "blatant misuse of public funds."
The EU directorate is set up to review state assistance given to businesses having the potential to distort competition, which is banned under the bloc's rules.
The government announced completion of the deal to rescue Flybe Tuesday as the airline teetered on the brink of bankruptcy. It carries more than 8 million passengers per year, mainly on domestic routes within Britain connecting cities such as Belfast, Norwich, Southampton and Bristol. It employs 2,400 people.
Details of the bailout have yet to be announced, but reports indicated it involves the government deferring demands for payment of Flybe's overdue tax bill, which is thought to be at least $130 million.
Walsh had expressed strong opposition to the emerging bailout in a letter to British Transport Secretary Grant Shapps in which he sharply criticized the Flybe's owners, a consortium of Virgin Atlantic and the U.S. airline group Delta -- direct competitors with BA and its Aer Lingus subsidiary on key domestic routes.
"Prior to the acquisition of Flybe by the consortium which includes Virgin/Delta, Flybe argued for tax payers to fund its operations by subsidizing regional routes," he wrote. "Virgin/Delta now want the taxpayer to pick up the tab for their mismanagement of the airline. This is a blatant misuse of public funds."