Ryanair chief executive Michael O'Leary has accused the EU of making a "nakedly political decision" by blocking Ryanair's proposed takeover of Aer Lingus.

At a press conference in Brussels yesterday, Mr O'Leary also said Ryanair would contest the merger decision by the European Commission in the European courts.

Speaking ahead of a formal merger decision due to be published today by the commission, Mr O'Leary said the commission was biased against Ryanair and was acting in support of national flag carriers that had the support of governments.

"This decision is politically motivated, designed to appease the narrow interests of the Irish Government, which was the only party - other than Aer Lingus itself - to object to the merger," said Mr O'Leary, who added that the Government's objections to the merger would be transposed word for word in the final decision by the commission.

A spokesman for the commission said no final decision had been taken yet by the college of commissioners and denied allegations that it would be a political decision.

"I can refute that completely. The commission is completely impartial and objective, and all major decisions are subject to challenge at the court of first instance," he said.

Mr O'Leary said he was holding the press conference before the formal EU decision was announced to counter a constant stream of leaks orchestrated by the commission.

The commission also categorically denied this allegation from the Ryanair boss.

Mr O'Leary said he would also oppose in the courts any decision by the commission to force Ryanair to sell its 25 per cent stake in Aer Lingus on the basis that Ryanair had no control over Aer Lingus.

He said Ryanair had asked Aer Lingus to do three things since it had built up its stake: to reduce prices, to remove the fuel surcharge and not to buy new aircraft at the top of the cycle.

Aer Lingus had done the opposite, said Mr O'Leary, who added that Ryanair also had no seat on the Aer Lingus board.

He warned that the proposed commission decision could reverse 20 years of EU airline consolidation in Europe, which had seen the commission approve all other mergers of large competitors.

For example the commission had approved the mergers of the Air France/KLM, Lufthansa/Swiss and Lufthansa Austrian airlines, he added.

"There is one rule for national flag carriers and another rule for low cost operators," said Mr O'Leary, who confirmed that Ryanair would take the commission to the European Court of First Instance over the decision.

He said he was confident of winning the case given that the commission has lost eight of the 20 merger cases that it has blocked since 1990 and the methodologyused in the decision was flawed.

"The decision is manifestly in error since it is based on the commission's inaccurate claim that there are barriers to entry at Dublin airport, when the case file evidence clearly proves that there are no barriers to entry at Dublin airport," said Mr O'Leary.

He said the commission was using a "base" competition concept - Ryanair and Aer Lingus both have their home base in Dublin - to back up its decision. He said this had no precedent and was a misapplication of 25-year-old US cases.

The commission had also failed to take into account the proposed consumer benefits and extensive remedies offered by Ryanair in an effort to get the merger passed.

For example, Ryanair had guaranteed consumers €100 million in lower fares every year, which would be refunded to consumers if the airline failed to achieve them.

Ryanair had also offered to transfer slots at Dublin airport to competitors, as long as they based six to 10 aircraft in the city. This amounts to 2,800 weekly slots, said Mr O'Leary, who noted Aer Lingus/Ryanair had a 5 per cent share of EU air traffic.

Asked by journalists why the Government would want to block a merger, Mr O'Leary said the airport was in Taoiseach Bertie Ahern's constituency, Aer Lingus was heavily unionised and it was part of the "Byzantine movements of the Government".

In a statement, Aer Lingus criticised Ryanair's claims. "Michael O'Leary has sought to 'take out' his closest competitor and he has failed," Aer Lingus chief executive Dermot Mannion said.

"He is now lashing out in a vain attempt to disguise that failure."