Karen Walker

It was almost a throwaway comment, but it was deliberately aimed. Gerald Greenwald, United Airlines' chairman, says that for two airlines to approach corporations jointly about discount deals, they would need antitrust immunity.

The statement, made during a question and answer period after the announcement of the United/Delta Air Lines tie-up, was aimed at Continental Airlines and Northwest Airlines. Those airlines announced their proposed codeshare alliance and equity transfer earlier this year. Officially, Continental and Northwest say they will not address the issue of joint sales and promotions unless they have government approval. The airlines are not seeking antitrust immunity for anything other than their transatlantic operations with KLM. But it is understood that Continental and Northwest consider sales and corporate deals as an area of possible future cooperation.

Delta and United maintain that their alliance will easily stay within the boundaries of antitrust laws. Greenwald says there is 'no intention' of working out joint cost waivers or of jointly approaching corporations with sales pitches. Adds Delta's chief executive, Leo Mullin: 'We have no intention of operating in a nod and wink way. We will operate by the rules.'

But as lawyers point out, with antitrust laws it is not always clear what the rules are. Some say that even mere cooperation on frequent flyer programmes can be regarded as overstepping the boundaries. 'These codeshare alliances are de facto mergers. They can be seen as a way to get round the antitrust laws. That is what the DOT and the DOJ will be looking at,' says one lawyer.

Source: Airline Business