European Union moves to stop governments from subsidising insurance schemes for airlines and airports came under fire yesterday.
Several member states have attacked the European Commission's decision to deny approval for the subsidies after October 31.
They have argued that Brussels' stance leaves them paying higher premiums for less cover.
The Commission has formal jurisdiction over the matter.
A Commission official said: "If the 15 countries are in favour of an extension we may have to continue with it. But at the moment there is a division between them."
Several states, led by Germany and France said that the threat of war with Iraq do not allow a return to the market.
A French diplomat said: "We have a majority in favour of continuing with the current system. The market is distorted, particularly with the US continuing to support its own industry."
