(BRUSSELS) - The European Commission is in contact with Italy over the fate of its near-bankrupt national flag carrier Alitalia but has not been informed of any state bail out plans, a spokesman said on Tuesday.

"There are contacts with the Italian government, but at this stage we have not been informed or notified of any decision to give any financial support to the company," transport spokesman Michele Cercone said.

He underlined that Alitalia had already received state aid in the past and that under EU rules it would not be entitled to do so again before 2011.

His remarks, to reporters in Brussels, came as outgoing Italian Prime Minister Romano Prodi met key aides and Alitalia's ex-chairman Maurizio Prato on the carrier's future after Air France-KLM formally withdrew a takeover offer.

A government official told AFP the full cabinet would meet on Wednesday to decide how to respond to Air France-KLM's decision to leave negotiations on April 2 over demands by Alitalia unions which it considered unacceptable.

The crisis comes as Italy awaits the inauguration of conservative leader Silvio Berlusconi as prime minister for the third time after his coalition scored a comfortable victory in elections last week.

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