TWO of the UK's last remaining independent regional airlines have expressed disappointment at the Office of Fair Trading's rejection of their complaint over British Airways' takeover of British Regional Airlines group.

The OFT has decided not to refer the deal to the Monopolies and Mergers Commission.

Gill Airways and Eastern Airways argued that the transfer of the BA franchisee, Bral, to BA ownership, and its £78m merger with BA subsidiary Brymon, would give them a hugely dominant position in UK domestic markets.

They said it would pose a threat to the livelihoods of smaller independent carriers, and limit the ability of airlines like Gill to enter new markets.

In a joint statement, Malcolm Naylor, chief executive of Newcastle-based Gill, and Richard Lake, managing director of Humberside-based Eastern Airways, said: "We are disappointed that the OFT has seen fit to dismiss the real concerns of the remaining independent airlines as unsolicited complaints.

"The report notes that British Airways has not entered a UK regional route for five years, yet ignores the activities of its wholly-owned subsidiary Brymon, with which Bral is to be merged.

"The Bral takeover is only the latest in a series of airline takeovers by BA, including British Caledonian, DanAir and CityFlyer Express."