Etihad Airways CEO sees more legal action in Air Berlin code-share dispute

Etihad Airways, which has a major stake in Air Berlin, said it expects further legal action in its dispute with the German government over code-sharing between the two carriers.

“There will be another hearing. In the meantime, the two regulatory authorities will weave the course to find a way forward,” Chief Executive James Hogan told reporters at an airlines industry association event in Abu Dhabi.

Code-share agreements enable airlines to extend their networks by selling tickets for flights operated by partners, thereby offering more destinations to their customers.

But the German government has said it will revoke approval for code-sharing by Etihad and Air Berlin on a number of routes which it says are not covered by the current bilateral air services agreement between Germany and the UAE.

Last year the government said it would only approve continued code-sharing on those routes until the end of this summer’s schedule while it negotiated with the UAE.

On Friday Etihad won a temporary injunction from a court in Brunswick to retain code-sharing on those routes until Nov 8 and Germany’s transport ministry then said the two airlines would be allowed to continue to operate the disputed code-sharing flights until mid-January but that was the final extension.

The president of the court said on Tuesday that no new application from Etihad had been filed at the moment but that could of course change.

“We have good support within Germany but we had to serve the injunction because we had to protect the jobs of our employees of 10,000,” Hogan said.

Etihad says the code-sharing flights, which open up European destinations to the Abu Dhabi-based carrier, were a key reason it invested in loss-making Air Berlin and the German government had previously approved all the routes in question.

Etihad owns 29.2 percent of Air Berlin, which has made operating losses in four of the last five years and is currently working on a new restructuring plan.

“We’ve invested in a German airline, it’s a German business – we’ve had those code-share agreements in place for seven seasons,” Hogan said.

“This (code-share agreement) is a key part of the Air Berlin turnaround-it’s not about Etihad,” he said.

Hogan did not say on Tuesday whether Etihad might move to ‘inter-lining’ agreements instead, which are a step down from code shares and which Germany had suggested could be an option for cooperating on the disputed routes.