15-Jul-2010 9:11 AM

EU approves oneworld carriers' trans-Atlantic venture

European Commission granted (14-Jul-2010) final regulatory approval for British Airways, American Airlines and Iberia to enter a joint business agreement on trans-Atlantic flights. The airlines anticipate they will receive the final decision on trans-Atlantic antitrust immunity from the US Department of Transportation (DoT) shortly. The airlines plan to launch the trans-Atlantic joint business this autumn. [more - European Commission (FAQ)] [more - British Airways]

  • Slot Commitments: The carriers offered competition commitments in relation to six routes - London-Dallas, London-Boston, London-Miami, London-Chicago, London-New York and Madrid-Miami - covering an initial ten year period, with another five year extension at the Commission's discretion.
    • London airports (Gatwick or Heathrow) slot commitments: New York (21 weekly slots), Boston (14 weekly slots), Miami and Dallas (7 weekly slots);
  • Frequent flyer programmes: BA, AA and Iberia undertake to provide access to their frequent flyer programmes on the relevant routes, allowing passengers of new entrants approved by the Commission to accrue and redeem miles on the parties' frequent flyer programmes.
  • Fares: The parties also propose to allow fare combinability and offer special prorate agreements in relation to the routes of concern, which would enable competitors to offer tickets on the parties' flights and facilitate access to connecting traffic.
  • Market Assesment: The carriers willsubmit data concerning their cooperation to the EC at regular intervals, which will facilitate an evaluation of the alliance's impact on the markets over time. [more - Competition commitments] [more - speech by Competition Commissioner ]

British Airways: “We await the DoT’s final decision but welcome this important and vital step forward. The high number of new services on London to US routes since the Open Skies agreement demonstrates that Heathrow is open. Between us, we have agreed to make available Heathrow slot pairs for our competitors to use on services to the US. This is a pragmatic decision so that we can get the joint business up and running as soon as possible. The slot commitments provide a further guarantee that there will be no possible loss of competition as a result of our joint business,” Willie Walsh, CEO. Source: British Airways, 14-Jul-2010.

European Commission: "Today's decision will enable the airlines to put in place the transatlantic alliance they have long aspired to while ensuring that the around 2.5 million passengers that use the London-New-York and other affected routes each year continue to benefit from a choice of frequencies and DoT," Joaquín Almunia, Vice-President in charge of competition policy. Source: European Commission, 14-Jul-2010.

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