Ryanair has cancelled plans to start flying to Ukraine, saying that the main airport in Kiev had not honoured terms agreed earlier this year.
Ryanair had been in negotiations with Boryspil airport since announcing in March that it planned new routes to Kiev and the west Ukrainian city of Lviv.
Earlier this month, Ukrainian International Airlines (UIA), which is part-owned by powerful tycoon Ihor Kolomoisky, denied in a statement that it had been lobbying to prevent a deal between Ryanair and Boryspil.
"Kiev airport has chosen to protect high-fare airlines and deprive Ukrainian consumers/visitors access to Europe's lowest air fares," Ryanair said in a statement last night.
"We regret also that Lviv Airport has fallen victim to Kiev Airport's decision," it added.
Ryanair said it would transfer the capacity to other markets, such as Germany, Israel and Poland.
The airline's decision could deepen concerns about the continued power of vested interests in Ukraine, whose government has vowed to tackle endemic corruption in exchange for a $17.5 billion bailout deal from the International Monetary Fund.