Portugal's prosecutors investigate lease of Airbus planes by airline TAP

By Sergio Goncalves

LISBON (Reuters) - Portuguese prosecutors have launched an investigation into a complex leasing deal for 53 Airbus aircraft by flag carrier TAP in 2015, and two people familiar with the probe told Reuters it covers suspicions of illegal payments.

It is the latest probe into Airbus' historic business dealings following a record $4 billion corruption settlement with French, British and U.S. authorities in 2020, and a related $14 million French settlement late last year.

Airbus exited three years of outside monitoring at the end of January and says it has undergone sweeping changes including a new system of compliance, which Chief Executive Guillaume Faury said on Thursday was one of the company's main focuses.

The leasing contract under investigation dates back to the time TAP, now again fully-state-owned, had just been privatised, passing control to the Atlantic Gateway venture between American-Brazilian aviation tycoon David Neeleman and Portuguese entrepreneur Humberto Pedrosa.

As part of the contract, TAP was to give up a lease of 12 Airbus A350 aircraft and start a new one for 15 A320neos, 25 A321neos and 13 A330-900neos, to be delivered in the following years, the sources said.

Last October, former Infrastructure Minister Pedro Nuno Santos told a parliamentary committee that TAP had ordered an audit of the leasing contract, alleging it was paying more for the airplanes than the market value. News outlet ECO reported last week the additional costs amounted to $254 million.

Without disclosing details, the minister said the government had decided to forward the audit to the public prosecutor's office, which confirmed this week it had taken up the case.

"It is under investigation and subject to the secrecy of justice," it said in a statement.

One of the sources told Reuters investigators were looking into a possible scheme in which the contract change allowed Airbus to illegally finance the acquisition of TAP by Atlantic Gateway in 2015.

The second source said payments of allegedly illegal commissions by Airbus to Atlantic Gateway were also under investigation.

TAP declined to comment on the probe or the allegations.

Airbus declined to comment "on our confidential contractual agreements with customers" and did not respond to questions about whether it had been contacted by Portuguese prosecutors.

Pedrosa told Reuters he was "completely confident of the legality of the acts carried out within the scope of our participation in the TAP privatisation process, always conducted with total transparency" and subject to legal evaluations.

Neeleman, who is the founder and CEO of the U.S. Breeze Airways, did not immediately reply to questions emailed to him, but has previously denied any wrongdoing, saying Atlantic Gateway's strategic plan for TAP was transparent and approved by the state, and new planes were bought or leased at market prices "as shown by the various independent assessments".

The state in 2020 bought Neeleman's stake in TAP, which is under a 3.2-billion-euro Brussels-approved bailout. The government is considering an outright or partial sale of the airline, with Lufthansa, Air France-KLM and British Airways owner IAG seen by analysts as potential buyers.

(Additional reporting by Andrei Khalip; Editing by Andrei Khalip and Mark Potter)