The Spanish government has launched legal action against airline Spainair after it stopped operations on Friday, cancelling 220s flights, which left 22,000 passengers stranded.
The airline according to the government, has violated Spain’s aviation regulations, and legal proceedings could lead to Spainair facing fines of up to €9m (£7.5m) for two ‘serious infringements’.
Development Minister Ana Pastor has confirmed the action after the airline – owned by a consortium based in the northeastern region of Catalonia – stopped its operations due to a lack of funding.
Officials revealed that the decision to close was made after the regional government – which holds a controlling stake in the company – announced it was unable to fund the airline.
The Catalan government named the ‘current economic climate’ and ‘European legislation concerning competition’ as the major factors which influenced its decision.
Last week Qatar Airways pulled out of talks to buy a stake in the airline, which according to the Catalan regional government destroyed Spainair’s only rescue plan.
The company has been searching for new investors since November and reports revealed that Qatar Airways was interested. The company employed around 2,000 staff and used the services of around 1,200 ground staff.
For some years the airline had struggled to compete with low-cost carriers operating in the country.
In 2010 the airline reported an operating loss of around €115m (£96m) and only survived due to finance provided by the Catalan government and private investors.
In Brussels, the European Low Fares Airline Association has announced that any of its members – including Ryanair and Easyjet – that fly overlapping routes with Spainair, would offer stranded passengers special discounted fares, which are subject to seat availability.
Article by Charlotte Greenhalgh