British Airways is to end its franchise agreement with GB Airways from March 2008 and intends to start services on some of the routes operated under the franchise.

British Airways plans to start services from Heathrow to Faro and Malaga and from Gatwick to Faro, Gibraltar, Ibiza, Malaga, Palma and Tunis. The new services will start from March 30, 2008.

The airline will also end its franchise with Loganair from October 25, 2008, and begin a codeshare arrangement with the Scottish carrier.

British Airways chief executive Willie Walsh, said: "UK franchises have outlived their purpose. easyJet has made an offer to buy GB Airways and this has enabled us to end the franchise agreement early. We had an option to buy GB Airways but we rejected it.

"We have a significant base at Gatwick and our focus will be on maintaining and developing it as an integral part of our business."

There will be a transition period until the end of the franchise agreements. British Airways, GB Airways, easyJet and Loganair are committed to ensuring a smooth transition for passengers during this period.

GB Airways will continue to operate as a British Airways' franchise partner on their existing network to destinations in Europe and North Africa until March 29, 2008. Loganair will continue to operate as a franchise partner on Scottish routes until October 25, 2008.

The deal between GB Airways and easyJet is expected to be completed within eight weeks. During this period flights will operate as normal. On completion, passengers can accept to be rebooked on easyJet or will be entitled to a full refund.