Germany’s competition regulator has given the green light forLufthansa's plan to wet-lease 38 Airbus A320-family jets fromAir Berlin.

In 2016, two airlines revealed a plan to transfer a total of 33 A320s and A319s to Lufthansa’s budget armEurowings, and another five A320s to group subsidiaryAustrianAirlines from this year as part ofAir Berlin's restructuring.

The Bundeskartellamt says the case involved "complex legal questions and raised issues that required clarification”, and notes that several competitors ofLufthansasubmitted comments opposing the wet-lease agreement.

Ryanaircommercial chief David O'Brien argued earlier this month that the pact will “block the market” and that the budget carrier will challenge the deal on grounds that it may breach EU competition rules.

The Bundeskartellamt admits that the wet-lease deal “naturally” enables Lufthansa’s to expand its business. But the federal authority concludes that Lufthansa’s “potential expansion is not sufficient to justify a prohibition of the agreement".

"The lease of aircraft from a competitor needs to be assessed differently than the takeover of the competitor itself," it argues.

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The regulator’s president Andreas Mundt says: “The agreement… does not relate to the routes served by the two air carriers.Lufthansawill not take over any ofAir Berlin's slots. Nor will the lease of the aircraft affect the re-allocation of slots that have so far been used byAir Berlin.”

As part of an evaluation of extensive market data and talks with a large number of market players, the authority asserts that a “majority of customers and travel agents questioned… did not express any serious competition concerns”.

However, the regulator adds that “on account of the results of the competition assessment, it could be left open whether the wet-lease agreement does in fact constitute a merger within the meaning of the German competition law.”

Air BerlinandLufthansaagreed the deal with an initial term of six years.

A separate agreement betweenAir Berlin, its shareholderEtihad Airwaysand tour operator TUI to establish a new leisure carrier on the basis of Austrian-basedNikiand TuiFly was not covered by the Bundeskartellamt’s probe.