The low-cost carrier had been appealing a 2007 decision by the European Commission which said that a merger between the two airlines was anti-competitive.
Upholding that earlier ruling, the court also dismissed a separate legal challenge by Aer Lingus which would have forced Ryanair to give up its stake in the flag carrier.
Ryanair has been a significant minority shareholder in its rival ever since Aer Lingus was privatised in 2006, with its current stake amounting to 29.3 per cent.
It has twice launched hostile take-over bids, faltering in 2007 on anti-competitive grounds and then again in 2008 when the Irish government, a fellow stakeholder, objected.
Re-affirming the earlier decision by the EU’s competition enforcer, the European General Court today said a merger would “significantly impede effective competition as a result of the creation of a dominant position on a number of routes from or to
But it also ruled out forcing Ryanair to divest its shareholding in Aer Lingus, saying it was a minority stake which did not confer control of the company to Ryanair.
Aviation experts say a third take-over bid by Ryanair is unlikely given the latest court ruling.
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