EasyJet will announce within weeks the location of a new European base as Britain's airline industry grapples with the potential consequences of a 'hard Brexit'.

Sky News understands that the low-cost carrier's board has pencilled in an April decision on the location of a new air operator's certificate (AOC), which will allow it to continue flying between EU member states.

The decision will effectively entail the establishment of a new legal headquarters for easyJet, although the company has no plans to relocate the 1000 staff who work at its operational head office at Luton Airport.

EasyJet has spent the last nine months evaluating the merits of securing an AOC in each of the remaining 27 EU member states, and sources said on Sunday that countries including Austria, Malta and Portugal had been under serious recent consideration.

Image: EasyJet chief executive Dame Carolyn McCall

Member states including the Netherlands are understood to have been ruled out by easyJet's management, led by Carolyn McCall, the airline's chief executive.


One insider said an announcement was "weeks rather than days away" but added that the shortlist of options was now "very short".

In addition to the new AOC, easyJet is expected to have to amend its articles of association to require that a majority of the parent company's shares are owned by EU nationals.

EasyJet's biggest shareholder - founder Sir Stelios Haji-Ioannou, who has dual UK and Cypriot citizenship - is currently classed as a UK shareholder, but would see his 33% stake designated as EU-owned under the revised articles.

The preparations for the UK's exit from the EU follow warnings from officials on the Continent that airlines such as easyJet and British Airways' parent, International Airlines Group, must have a majority of their shares owned within the EU.

The Guardian reported last week that carriers had been reminded of those obligations at a recent meeting.

In easyJet's case, the company has yet to clarify publicly exactly how its new entities will be structured, but it could involve up-ending the current corporate structure by making its existing UK AOC entity a subsidiary of its newly incorporated legal headquarters.

EasyJet employs roughly 1,000 people at its Luton base, in functions such as finance, IT and marketing - separate to the staff who work on its operations at the Bedfordshire airport.

Banks and car manufacturers are among the businesses that are exploring the need to relocate some of their UK-based staff as Brexit looms.

Existing rules in the EU mean that there is a single aviation agreement across the bloc, but the UK's continued membership of that is uncertain.

Last week, the UK's Airport Operators Association added its voice to those warning about the implications of a hard Brexit, saying:

"If there are no such agreements by the time the UK leaves the EU, the UK's connectivity will be undermined and its ability to trade will be made significantly more difficult.

"It is therefore important that we reach agreement of a transitional deal on aviation early in negotiations to provide certainty for business and consumers."

In a statement to the London Stock Exchange in the aftermath of the Brexit vote, the company said: "EasyJet has been preparing for this eventuality in the lead up to the referendum vote and has been working on a number of options that will allow it to continue flying in all of its markets."

EasyJet declined to comment further on Sunday.