Europa Tenders: Mergers: Commission approves proposed acquisition of parts of Air Berlin by easyJet
12-Dec-2017 The European Commission has approved unconditionally under the EU Merger Regulation the proposed acquisition of certain assets of Air Berlin by easyJet. The Commission concluded that the transaction would not adversely affect competition in the EU Single Market.
Commissioner Margrethe Vestager, in charge of competition policy, said: "Our job is to make sure that airline takeovers do not result in less competition - that would mean higher flight fares and less choice for consumers. EasyJet's plans to buy certain Air Berlin assets will not reduce competition and we have approved it today. Our decision enables easyJet to grow its presence at Berlin airports and start competing on new routes to the benefit of consumers".
Following several years of financial difficulties, Air Berlin, Germany's second largest airline, filed for insolvency in August 2017, resulting in the sale of its assets. In the following weeks, Air Berlin grounded its operations, and left the market. EasyJet proposed to acquire certain assets and rights held by Air Berlin as part of its passenger transport operations at Berlin Tegel airport, including slots at Berlin Tegel airport and at some destination airports. Slots are the permission to land and take-off at a specific date and time at an airport.
The Commission's investigation
The Commission examined the impact of the proposed transaction, looking in particular at whether the slot portfolio to be acquired by easyJet in Berlin Tegel, and at destination airports, would allow easyJet to shut out competitors from the market for passenger air travel to and from Berlin. Indeed, control over slot portfolios at congested airports can result in higher barriers to entry for airlines wanting to operate to and from those airports, which in turn could result in higher fares for passengers.
The Commission's investigation found that:
- the increase in the slot portfolio of easyJet at the congested airports, and in Berlin in particular, was unlikely to have a negative effect on passengers, and
- easyJet will continue to face strong competition from large carriers like Lufthansa and Ryanair on routes from and to Berlin.
The Commission therefore concluded that the proposed acquisition would raise no competition concerns in any of the relevant markets.