Antitrust Law Daily Wrap Up, ANTITRUST NEWS: AAI comments on New York area airport slot management, (May 11, 2015)
Organizations Mentioned:American Antitrust Institute | U.S. Department of Transportation
In response to a Notice of Proposed Rulemaking (NPRM) by the U.S. Department of Transportation (DOT) and Federal Aviation Administration (FAA), the American Antitrust Institute (AAI) has submitted its comments regarding slot management and transparency for LaGuardia Airport (LGA), John F. Kennedy International Airport (JFK), and Newark Liberty International Airport (EWR).
The AAI comments highlight the NPRM proposals that are likely to have beneficial effects on entry, competition, and efficiency, while providing important context regarding competition in the U.S. airline industry for the purposes of evaluating the proposals in the NPRM.
Those proposals like to have beneficial effects include (1) limiting the ability of incumbents to exclude rivals by minimizing potential withholding of slots and (2) coordinating the Department of Transportation’s review of slot transfers with the Department of Justice.
According to the AAI, there is a need for new slot policies because (1) mergers have resulted in high concentration and barriers to entry, (2) hub congestion adversely affects smaller market participants, and (3) a focus on new entrants is likely to promote more competitive outcomes.
The AAI also offers suggestions in various areas where the NPRM proposals could be refined to better achieve the FAA's procompetitive goals. These refinements include: (1) having slot policies take into account problems at other airports, (2) considering modifications to procedures for reviewing slot transactions; and (3) modifying the 80 percent usage requirement in an effort to balance planned and unplanned cancellations and potentially anticompetitive exclusionary tactics.
News: Antitrust