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UPDATE 1-No indication of changed Lufthansa/AUA remedies-EU

Mon Jul 13, 2009 7:41am EDT

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(Adds details from EU Commission, Lufthansa comments)

BRUSSELS, July 13 (Reuters) - Lufthansa (LHAG.DE) has given no indication that the German carrier will improve proposed antitrust remedies for its planned takeover of Austrian Airlines

(AUA) (AUAV.VI), the European Commission said on Monday.

A spokesman for the European Union's executive arm said Lufthansa had formalised proposals it offered to the Commission to address concerns that the deal may hurt competition, but these were insufficient.

"These remedies were worse than the first remedies they had offered to the Commission during the first phase of the investigation," spokesman Jonathan Todd told a daily news briefing.

"Since then, Lufthansa has given the Commission no indication that it wants to revise its proposed remedies," he added.

Lufthansa's offer for AUA, agreed last December, is valid only until July 31 and the airline can walk away from the deal if it has not won EU antitrust approval by then, or if the EU's conditions are too onerous.

The EU executive's formal deadline for reviewing the proposed takeover is Nov. 6.

"The EU has our offer," a spokeswoman for Lufthansa said in Frankfurt, referring to the formal offer filed with the EU executive on Friday.

The Commission said it would make a rapid decision if Lufthansa satisfied its competition concerns over routes flown by the two airlines.

But in the absence of effective remedies, Todd added, the chances of a decision before the end of July were fading fast.

"The Commission has particular concerns about routes from Vienna to Frankfurt, Munich, Stuttgart, Cologne, Zurich, Geneva and Brussels," Todd said.

"On all of these routes, in fact, on all routes currently flown by the two airlines, we need to be satisfied that there would be alternative airlines available within a reasonable period of time to offer passengers a choice," he said.

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(Reporting by Bate Felix in Brussels and Maria Sheahan in Frankfurt; Editing by Dale Hudson)

((Reuters Messaging: bate.felix.reuters.com@reuters.net; Email: bate.felix@reuters.com; +32 2 287 6812)) Keywords: LUFTHANSA AUSTRIANAIRLINES/EU

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