Sunday, June 13, 2010

BA/Iberia Antitrust Review Underway

It was reported last Friday that the European Commission has set July 15, 2010 as the provisional date for concluding its investigation of the proposed British Airways/Iberia merger.  See Peppi Kiviniemi, EU Begins Probing BA/Iberia Merger Plans, Dow Jones Newswires, June 11, 2010 (available here).  From the story:

Concerned that the deal may create monopolies on certain routes the commission, Europe's highest antitrust authority, has already sent a questionnaire to competitors querying whether they see any issues with the merger, according to a person familiar with the questionnaire.

Main routes under scrutiny concern flights between London to Madrid, London to Barcelona and London to Malaga the person said. In addition the commission is asking questions about some 20 indirect routes. The commission is also asking about the likelihood of passengers being willing to substitute close-by airports with each other, to see whether instead of flying directly to Barcelona passengers might be happy to board a flight that lands close to Girona, the person added.

Brussels lawyers following the airline industry closely say that it is likely the commission has its eye on gaining some concessions from the airlines before clearing the deal.

The deal is expected to make the combined airline the third largest in Europe by revenue.  It will also mark another step toward a sustainable air transport market in the EU.  Since the finalization of a common aviation market in the 1990s, the Union has seen numerous crossborder consolidations, including the landmark Air France-KLM tie-up and Lufthansa's acquisitions of Austrian Airlines, bmi, and Swiss.

http://lawprofessors.typepad.com/aviation/2010/06/baiberia-antitrust-review-underway.html

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