LONDON-- British Airways parent International Consolidated Airlines Group SA has pulled out of a major European airline trade body as the battle over how to deal with Middle East growth carriers escalates.

IAG ceased its membership in the Brussels-based Association of European Airlines because "on some important policy issues is not aligned with the other AEA legacy airlines," the London-based airline group that also owns Spanish carrier Iberia said in a statement.

"In particular, we believe global liberalization of our industry is fundamental to our future growth and we are not willing to compromise on this fundamental matter," IAG said in an emailed statement.

Several European airlines have clashed with rapidly expanding Middle East carriers, such as Emirates Airline, Etihad Airways, and Qatar Airways, over their pace and method of growth. Air France-KLM SA and Deutsche Lufthansa AG, who have lost Asian traffic to the Persian Gulf state airlines, have lobbied national governments and the European Union to curtail the growth of the rivals they accuse of benefiting from unfair state subsidies.

The battle has now expanded to the U.S. where carriers such as Delta Air Lines Inc. are leaning on the government to limit the Mideast airlines' growth. The Middle East carriers deny they are subsidized.

The AEA said on its website that it "calls upon European governments to effectively dissuade non-EU governments from pursuing discriminatory policies which distort competition among international airlines."

The association couldn't immediately be reached for comment about IAG's exit from the group that was first reported by trade publication Aviation Week.

IAG Chief Executive Willie Walsh has long championed greater liberalization in aviation markets even before Qatar Airways this year took a 10% stake in the European airline group making it its largest shareholder.

Etihad Airways Chief Executive James Hogan on Wednesday met the EU's transport commissioner, Violeta Bulc. The European Commission, the bloc's executive arm, this year plans to spell out a new aviation policy, covering issues such as competition.

"Growing resistance to us from a handful of protectionist competitors could have unintended consequences well beyond limiting our development, " Mr. Hogan said in a statement after the meeting. "If our growth is curtailed or our investments in airlines are compromised, the real damage will be to Europe in lost jobs, lost flight connectivity, lost investment in local and national economies and lost consumer choice."

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