Wednesday, June 9, 2010

Clarifying Antitrust Immunity

Last week Friday, a number of national papers picked up a story analyzing the potential for a US Airways/American Airlines merger.  See US Air/American Link Could Bolster Global Routes, Reuters, June 4, 2010 (available here).  The article speculated that the two U.S.-based air carriers could forge an alliance relationship before seeking a full-on merger.  According to the story: "In that scenario, US Airways and American would seek an exemption from U.S. antitrust law to share scheduling and pricing details."

This is not entirely accurate.  The 1979 International Air Transportation Competition Act allows for intercarrier agreements which affect foreign transport to be filed before the Department of Transportation for approval and antitrust immunity.  See 49 U.S.C. §§ 41308-09.  In other words, US Airways and American would still be subject to U.S. antitrust statutes with respect to their domestic operations even if they received immunization to cooperate with their foreign partners.

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