Tuesday, October 4, 2011

LAN, TAM to Appeal Merger Conditions to Supreme Court

Brazilian carrier TAM and Chilean flagship LAN Airlines have announced their intention to appeal to Chile's Supreme Court three of the conditions imposed by Chile's antitrust tribunal TDLC for allowing the merger of the two airlines to proceed. See LAN Airlines press release (available here). While LAN and TAM insist that this appeal does nothing to jeopardize the scheduled completion of the merger by the end of first quarter 2012, the appeal should still be of interest to the international air transport sector because one of the conditions appealed concerns the intriguing question of how LAN and TAM will resolve their code share agreements. LAN is currently a member of Oneworld, while TAM belongs to the Star Alliance. LATAM, when formed, will only participate in one of the two alliances, but according to the press release, the airlines object to the proposed scrutiny of any code share agreements retained outside of the chosen alliance.


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