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The Competition & Markets Authority (CMA) has a launched an investigation into the proposed takeover of Air Europa by International Airlines Group.
The group – which currently owns British Airways, Aer Lingus and Iberia – agreed to take over the smaller Spanish carrier for €500 million earlier this year.
The regulator has now confirmed it will examine if the deal harms competition in the UK.
IAG had initially announced plans to buy Air Europa for €1 billion in 2019.
However, the price was cut in half after the aviation sector was hit by the Covid-19 pandemic.
IAG has offered concessions to address EU antitrust concerns over the deal, a filing showed last month, though details were not provided.
The European Commission opened an in-depth investigation in June, voicing concerns that the proposed transaction would reduce competition on Spanish domestic routes and on international routes to and from Spain.
The deal, which involves Iberia buying Air Europa on behalf of IAG, had sparked opposition from the Unite union over jobs and from rival carriers.
The CMA said it has set a January 19th deadline for its initial investigation decision.
The body also confirmed it would launch a similar probe into the acquisition of Asiana by rival Air Korea.
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