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UK airline EasyJet is planning to set up a new company in Austria to protect its European business after Britain leaves the EU.

The new airline, EasyJet Europe, will be based in Vienna.

The airline must have an air operator certificate in an EU member country to allow it to continue flying between member states after Brexit.

EasyJet said its application was "well advanced" and it hoped to receive its licence in the "near future".

The carrier said "nothing will change" from the perspective of passengers, and that all the staff and planes that would fly for EasyJet Europe were already employed and based in the other 27 EU countries.

A spokeswoman for the prime minister Theresa May said the move by EasyJet was a "commercial decision" and that the government was working to achieve the best deal for business.

Open skies

EasyJet announced last year that it was in the process of establishing a separate presence on the European mainland, in readiness for when the UK leaves the EU.

This is because the UK risks losing access to Europe's internal "open skies" arrangement.

Since 1997, any EU airline has been free to fly between any two points in Europe, something that enabled companies such as EasyJet and Ryanair to grow to their present size.

Current EU flying rights might have to be renegotiated and the new company would ensure EasyJet could operate within the EU.

The UK government has said maintaining "liberal access" to European aviation markets will be a top priority during Brexit negotiations.

Unless British negotiators manage to secure preferential conditions, UK airlines could find it harder to launch new routes in Europe.

In a statement, EasyJet said: "While the new structure will protect all of EasyJet's current flying rights within Europe, EasyJet will continue to push for the UK and EU to reach an aviation agreement which, at a minimum, will enable flights between the UK and EU."

EasyJet already has an airline based in Switzerland, as well as its UK operation. The parent company - EasyJet PLC - will retain its London Stock Exchange listing and its Luton headquarters.