UK regulators to examine Aer Lingus takeover of Cityjet route

‘Wet leasing’ deal for Cityjet’s London service to be investigated by competition authority

The Dublin-London City route has been Cityjet’s mainstay since it launched in the 1990s. Photograph: Nick Bradshaw

The Dublin-London City route has been Cityjet’s mainstay since it launched in the 1990s. Photograph: Nick Bradshaw

 

UK regulators intend investigating Aer Lingus’s plan to take over Cityjet’s services from Dublin to London City Airport for possible breaches of competition law.

Cityjet recently announced that it planned to transfer the services to Aer Lingus, but would provide the craft and crew to operate the services under an arrangement called “wet leasing”.

The UK’s Competition and Markets’ Authority (CMA) says it is investigating whether the deal qualifies as a merger under that jurisdiction’s Enterprise Act and, if so, if it reduces competition for goods and services.

This stage of the authority’s investigation could run until December 24th and will establish if there is a need for a more detailed “phase two” investigation or whether to allow the deal go ahead as the parties’ intend.

Cityjet and Aer Lingus announced the deal in late August. Under its terms, Cityjet would relinquish the Dublin-London City Airport service to Aer Lingus.

However, Cityjet would provide two Avro RJ85 aircraft and crew to fly the route under the Aer Lingus brand.

Aer Lingus would sell the tickets for the flights and pay Cityjet an agreed fee for providing the service.

The Dublin-London City route has been Cityjet’s mainstay since it launched in the 1990s. However, founder and chief executive Pat Byrne shifted the carrier’s focus in recent years from flying scheduled services to wet leasing for other airlines.