(This March 6 story has been corrected to say that the Air France-KLM was never invited to be part of a Lufthansa and United Airlines joint venture in paragraph 6)

By Alban Kacher and Anna Peverieri

(Reuters) - Air France-KLM has had positive discussions with the Portuguese government about its possible participation in a privatisation of flag carrier TAP, and would agree to preserve its brand, network, and local jobs, Air France-KLM's CEO Ben Smith said on Thursday.

Air-France KLM will go ahead with the project if the timing and conditions are right, Smith added at a results press conference.

The Franco-Dutch group, Lufthansa and British Airways owner IAG have shown interest in TAP's privatisation, which the Portuguese government has said it wants to carry out this year.

"The discussions that took place last week were very positive from a political point of view. There is a marked interest in this partnership to be put in place with the public announcements that have been made by (French) President (Emmanuel) Macron along these lines," Smith said.

The timing of the privatisation depends on the Portuguese government, Smith said, adding that Air France-KLM is ready to meet requirements on the preservation of TAP's brand and network, as well as the safeguard of local skilled jobs.

The Franco-Dutch airline was never invited to join the transatlantic joint venture between United Airlines and Lufthansa, and aims to form a partnership with TAP rather than a full merger, to avoid the "inquisitorial eye" of the European Commission, Smith said.

The current stance of the Commission on merger deals weighs on European airlines' competitiveness, Smith said, adding that the French-Dutch group has not spoken with the EU's executive body about TAP Portugal.

European regulators have said they are concerned that major takeovers will lead to higher air fares for consumers.