The Etihad Airways headquarters in the UAE capital Abu Dhabi. Etihad said yesterday it had received financial support from its shareholder in the form of equity capital and shareholder loans, but gets no government subsidy.

Reuters/Sydney/Dubai


Etihad Airways had access to an interest-free $3bn loan from Abu Dhabi’s ruling family, the Australian Financial Review newspaper said yesterday, prompting criticism from rivals that have long complained of state support for the carrier.
Citing what it said were leaked documents prepared for prospective financiers in 2011, the newspaper said the loan for government-owned Etihad required no repayments until 2027.
Etihad, which also has equity stakes in Air Berlin and Aer Lingus, has long rejected allegations from rivals in Europe and Asia that it receives unfair financial support or state subsidies.
Etihad, which has been looking at a possible investment in loss-making Alitalia, said in a statement it had received financial support from its shareholder in the form of equity capital and shareholder loans, but gets no government subsidy.
It said the airline operated under a strict commercial mandate.
Europe’s largest airline Lufthansa, one of the biggest critics of Gulf carriers, renewed calls for EU authorities to ensure fair market conditions.
“It is crucial that the European Commission and the authorities in the European member states protect their private European airlines and European hubs,” a spokesman said.
Etihad, and other regional carriers such as Emirates and Qatar Airways, have been rapidly expanding their global reach, sometimes through partnerships.
European airlines are alarmed by this growth and allege that the Gulf carriers are not competing on a level playing field.
Air Berlin, in which Etihad has a near-30% stake, declined to comment.
Etihad is a major shareholder in Virgin Australia Holdings, which has been engaged in a fierce price and capacity war in Australia with flag carrier Qantas Airways Ltd.
Qantas has long complained that Etihad, and by extension Virgin, have benefited from subsidies from the Gulf state, something Etihad management has repeatedly denied.
The newspaper said industry sources had provided the documents, which had circulated among the management ranks of Etihad’s competitors, such as Qantas and Emirates.
Virgin Australia did not comment on the report.