Australia has approved V Australia's application to begin a codeshare agreement with Abu Dhabi's Etihad Airways.
The International Air Services Commission has also allocated it capacity on routes to the United Arab Emirates, Thailand, France, Greece and Bangladesh as part of a wider marketing deal between the two carriers.
V Australia, the long-haul subsidiary of the Virgin Blue group, plans to introduce three weekly Boeing 777-300ER services between Sydney and Abu Dhabi from February 2011. Etihad Airways would place its code on the services, with its customers having access to all Virgin Blue services via interlining.
A further three weekly V Australia services are planned from February 2012 between Brisbane and Abu Dhabi, and that application is still being considered by the commission.
The proposed arrangements also involve V Australia placing its code as a marketing carrier on services operated by Etihad on several routes.
The IASC says that the capacity utilised by a marketing carrier on many of these routes is not considered to be part of the entitlement under air services agreements. However, capacity allocation is required on some of the routes.
Accordingly, the commission has allocated V Australia capacity for 150 seats daily to France, 800 seats per week to Greece, five frequencies per week to Bangladesh, and seven weekly services to Thailand.
"V Australia and Etihad propose to co-ordinate pricing and marketing of the services covered by the arrangements. However, they do not propose to pool or share revenue," says the IASC.
The carrier must commence services on the routes no later than 1 April 2011, and is permitted to use the capacity jointly under its codeshare agreement with Etihad airways.