Ita-Lufthansa, here are the proposals to the EU. Brussels decision on 4 July

On the Ita-Lufthansa dossier, the Mef and the German group on Monday night handed over the document with the additions to the 'remedies' to the European Commission, which moved the final decision to 4 July (compared to the previous deadline of 13 June). Technically this is not a postponement because more time has also been given to Mef and Lufthansa to present the proposal on cutting the routes (compared to the 26 April deadline) with the aim of meeting Brussels' request. Which - as envisaged by the Phase II procedure of the investigation - has therefore shifted by 20 working days the verdict on the acquisition by the German giant of 41% of Ita Airways for an amount of 325 million.

According to information gathered in Brussels, the German company would have proposed a reduction of its slots at Linate. Less solicitous would have been on the intercontinental routes front. On the merits, in response to the objections raised by the European Competition DG on the first aspect - Lufthansa's dominance at Linate-, Ita and Lufthansa are willing to cede 11 pairs of slots (22 round-trip) at the Milan airport to competing companies (including Easyjet). Ita will maintain its presence 'unaltered', explained president Antonino Turicchi: 'The incremental slots are subject to release, putting Lufthansa and Ita together will not increase the share that Ita has, so the 22 pairs of slots of the Lufthansa group will be the subject of release'.

Another critical issue for Brussels is the strong presence of the Star Alliance agreement on intercontinental routes: in the final proposal, the 'remedies' include freezing for two-three years Ita's participation in the transatlantic joint venture (with United Airlines and Air Canada) on routes to the United States and Canada, where it will continue to operate temporarily as a competitor. Finally, the request to reduce connections with Central Europe: the proposal of Mef and Lufthansa foresees that about fifteen routes departing from Linate and Fiumicino for the main airports of Germany, Belgium, Austria and Switzerland will be cut.

As the next step, the EU executive will have to carry out market tests to assess with stakeholders (airlines, airports) whether the proposed measures will be sufficient to ensure free competition, and avoid a price increase for consumers. A tug-of-war between Frankfurt and Brussels has been going on for weeks, and Lufthansa has so far been reluctant to meet the EU's demands. The negotiations are therefore entering into full swing, after several stop-and-go, considering that the first 'remedies' were presented on 11 April last, following the objections to the merger notified on 25 March by the European Commission, which judged them insufficient.

There is optimism at Ita and Lufthansa. "We have done a lot of work to meet the objections raised by the European Commission," said Turicchi, "and we believe that the work we have done is such that we have the green light for the operation. Lufthansa CEO Carsten Spohr made the same comment: 'We continue to expect a positive decision from Brussels on Ita Airways by the summer,' he said at the meeting. 'The revised package responds to the Commission's concerns about short- and long-haul flights and concentration at Milan Linate airport. European Commission Vice-President Margrethe Vestager, who reiterated on 7 May: 'If the serious competition problems cannot be solved, we cannot approve the transaction', did not give an opinion.