Competition Bureau provides report to Minister of Transport outlining competition concerns in propos

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Competition Bureau provides report to Minister of Transport outlining competition concerns in proposed northern airlines merger

The Competition Bureau announced today, that following a thorough review, it has determined that the proposed merger of First Air and Canadian North is likely to result in a substantial lessening of competition in the provision of passenger travel and cargo services. The effects of the transaction are likely to include reductions in passenger and cargo capacity, increases in price, and reductions in flight schedules.

Many communities in the North rely on air services due to the large geographic areas and limited road infrastructure in certain areas. These services play an important role in economic development, interconnectedness among communities, and the supply of food, healthcare and other goods and services. Many communities served by First Air and Canadian North are accessible only by air for much of the year.

The Bureau’s review focused on services offered by both airlines to communities in Nunavut and the Northwest Territories. In most of the affected areas, the proposed transaction represents a merger-to-monopoly.

The transaction is likely to affect the following areas:

  • Nunavut: Qikiqtaaluk and Kitikmeot regions.
  • Northwest Territories: Services between Yellowknife and Inuvik.
  • Trunk Routes: Ottawa-Iqaluit and Trans-Arctic service (linking Yellowknife to Rankin Inlet and Iqaluit).

The Bureau’s concerns are outlined in a report to the Minister of Transport. Transport Canada is conducting a separate review of the proposed merger with respect to the public interest as it relates to national transportation.

The final decision regarding the proposed merger will be made by the Governor in Council (Cabinet) based on advice from the Minister of Transport.

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This press release was sourced from Government of Canada on 26-Feb-2019.