Brussels paralyzes approval of Air Europa merger with IAG after Koldo affair breaks out

03/04/2024

Updated at 10:43 p.m.

The European Commission decided to “stop the clock” in its review of the acquisition of Air Europa by Iberia parent IAG, coinciding with the disclosure of numerous data that could imply that there were serious violations in saving this airline, and this happened before it was saved with public money. Competition Commissioner, Margrethe Vestagerattempted today to publicly separate this decision from the corruption allegations affecting Air Europa, although the formal gesture of abruptly stopping its analysis on Friday can only be interpreted as a direct consequence of the emergence of this information, in which even Begoña Gómez, the wife of Prime Minister Pedro Sánchez, appears.

According to Vestager, when his department will make a decision “stop the clock”

that is, stop the analysis process so the legal period for his imprisonment has not expired, because “need more information”. Obviously, the reasons why this data is required can vary, but in this case it necessarily relates to information that raises serious doubts about the airline’s rescue operation during the pandemic.

According to Vestager, “everything that happens during the investigation does not have to be significantly related to the competition portfolio” that she manages. The Commissioner used the well-known language regarding the absolute necessity for the commission to back up every decision it makes on a sound legal basis that leaves no loopholes that would allow future challenges to be made in European courts. And by way of explanation, he emphasized that in these circumstances, “it may be difficult for the company to provide the information that we request.” In the link, this could also be interpreted to mean that the clarifications sought would be related to ongoing investigations into corruption cases involving the airline.

“Stop the Clock”

Typically, the commission is only concerned with the economic impact of the Air Europa-Iberia merger and its impact on the market, for example on routes that the two companies currently share and which could constitute a monopoly that would reduce consumer options. to choose the best rates. At this stage of the analysis, they cannot delve into criminal aspects such as corruption or misuse of public money, for which Vestager is also not responsible. However, the fact that the decision was made to “stop time”, and without an official announcement, since this information was disseminated by the companies themselves, suggests that spreading rumors

and facts revealed during the police investigation forced Brussels to stop analyzing for a moment waiting to learn new data and achieve it.

The intervention of the European Public Prosecutor’s Office in various matters related to the Koldo case in Spain gives the negotiations on the merger of the two companies an aspect that is increasingly complicating the matter in Brussels.