Flight Options, the parent company of seat-only operator Kiss Flights ceased trading at 6pm CEST tonight.
The company had recently expanded its summer programme and is understood to have thousands of customers abroad.
The Civil Aviation Authority said it expected most of the customers to be covered by Atol protection.
Kiss Flights offers cheap flights to Greece, Egypt, Turkey and the Canaries
Kiss Flights was set up shortly after the XL Leisure Group collapse, and was led by former Freedom Flights director Paul Moss.
The group was licensed by the CAA to carry 168,700 passengers between April 2010 and March 2011 including 69,500 passengers in the peak season between July and September.
Kiss concentrated on trade-only sales and still paid agents 10% commission, in contrast to most seat-only operators.
Much of its flying programme was with Viking Airlines, who today announced a restructure that will see its fleet reduced in size and several job losses in the UK
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