Oneworld airlines expect US tie-up decision shortly

London
Source:
This story is sourced from Pro
See more Pro news »

Oneworld carriers British Airways, American Airlines and Iberia are hoping soon to receive final clearance from US authorities for their transatlantic tie-up, in order to commence joint activity this autumn.

The three carriers today secured clearance from the European Commission for their three-way transatlantic venture, and British Airways says the partners "anticipate that they will receive the final decision...from the US Department of Transportation shortly".

British Airways chief Willie Walsh describes the European approval as an "important and vital step forward" and says the concessions to gain clearance amounted to a "pragmatic decision" to allow the venture to start "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," he says.

European Commission regulatory attention has concentrated on six transatlantic routes: five from London - to Dallas, Boston, Miami, Chicago and New York - plus Madrid-Miami.

Lack of peak-time slots at London Heathrow, combined with the Oneworld carriers' frequencies and dominance of connecting traffic, have resulted in a high entry barrier on these routes.

The three airlines have agreed to make slots available from London Heathrow or London Gatwick to Dallas, Boston, Miami and New York, allowing competitors to fly 49 return flights weekly to these four US destinations. Slots will be accessible at New York JFK.

BA says slots will be freed if competitor carriers cannot obtain them through normal channels. Slots on the London-New York route, it adds, will only need to be released if the number of services falls below current levels.

As part of the concession package the Oneworld carriers will grant other freedoms, including access to their frequent-flyer programmes for new-entrant competitors.

In its ruling today the Commission points out that the clearance "does not conclude" whether there has been an infringement of European competition rules, but it legally binds the three carriers to their remedial offer. If the airlines break their commitment, they could be fined without any need to prove breach of competition rules.