EU flags concern over Austrian minimum airfare plan

The EU has raised concerns over Austrian plans to set a minimum airfare, a spokesman said, weighing in on an environmental policy debate that pits traditional airlines against low-cost carriers. A minister from Austria’s Greens, the junior partner in the governing coalition, announced plans last June for an E40 minimum fare that explicitly targeted no-frills operators. The EC “expects to receive more detailed information from the Austrian authorities on the precise content of the envisaged measures,” the spokesman for the EC said Wednesday. Faced with pressure for higher airline taxes to curb greenhouse gas emissions, flag carriers like Lufthansa and Air France-KLM have argued instead for minimum fares that could all but abolish much of the low-cost market. Austria unveiled its proposal after granting E600m in aid to Lufthansa-owned Austrian Airlines. But a “pricing freedom” provision within the EU’s main 2008 air services regulation states that airlines “shall freely set air fares” for flights within the bloc.<br/>