Tuesday, July 13, 2010

American Airlines' alliance may win antitrust OK this week
07:34 AM CDT on Tuesday, July 13, 2010

By TERRY MAXON / The Dallas Morning News tmaxon@dallasnews.com

American Airlines Inc. and its allies may finally win approval this week to form a closer partnership with exemption from antitrust laws.

American and four of its partners in the Oneworld global airline alliance – British Airways PLC, Iberia, Finnair Oyj and Royal Jordanian Airlines – are seeking antitrust immunity to work together more closely on operations and marketing.

In addition, American, British Airways and Iberia are seeking permission to form a joint business arrangement that would allow them to jointly coordinate schedules, set pricing, market flights, offer frequent-flier benefits and otherwise collaborate.

Reuters reported Friday that the European Commission was expected to take up the application today. The Wall Street Journal also reported that in its own story posted on its website Monday.
An insider has told The Dallas Morning News that a decision is more likely to come Wednesday. An American Airlines spokesman declined to comment Monday afternoon.

A decision on their separate application with the U.S. Department of Transportation is expected this month,, perhaps also this week.

Since the parties filed their application with the Department of Transportation in August 2008, British Airways and Iberia have agreed to merge. That proposal is still before regulators.

The applicants have argued that they need the ability to work together to put them on par with the other two major alliances – SkyTeam, led by Delta Air Lines Inc. and Air France KLM, and the Star Alliance, led by United Airlines Inc. and Lufthansa German Airlines.

Both SkyTeam and Star have had antitrust immunity across the North Atlantic for years, and the Star Alliance recently added Continental Airlines Inc. to its lineup.

But Virgin Atlantic Airways Ltd., which is not a member of any of the three alliances, has vigorously fought the latest proposal, as it had two previous applications filed by American and British Airways.

Virgin has warned that American and British Airways already control too much of London Heathrow Airport, the world's busiest airport for international passengers. Approving the alliance would increase their concentration and be anti-competitive, Virgin has argued in its filings on the case.

In a preliminary decision Feb. 13, the DOT said the applicants would have to give up a few landing and takeoff slots at Heathrow to win final approval.

Separately, the applicants had proposed some concessions on trans-Atlantic routes to the European Commission.

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