Contrary to previous announcements, Slovak Airlines (SA) director, Christiane Boehm-Mayer, said on Tuesday the company under her management might be pressed into filing for bankruptcy proceedings.

"Weve had to cancel all flights and are taking other measures. Without flights, the company has no prospects, and well have to file for bankruptcy," Boehm-Mayer said.

The air carrier was prompted to suspend flights after the Austrian Airlines (AUA), the majority shareholder of SA, refused to take on SA hidden liabilities unraveled last year and took as guarantee the two of the three SA aircraft - a Fokker 100 and a Boeing 737-300. The third of SA fleet has been recently taken by an Austrian leasing company.

"Its a business entity like all others, so let it act in line with the Commercial Code," Transportation Minister Lubomir Vazny said Tuesday after talks with SA representatives.

The minister expressed hope that the situation could still be reined in and that the next business meeting in this regard could be set for Wednesday.

AUA threatened to discontinue the SA air traffic services as of February unless the government clears EUR 13.4 million in old debts. The figure includes EUR 6 million in liabilities from the Slovak cabinet. The debts concerned were created before the investor took over SA - which was previously owned by the state - in autumn 2004.