Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Australian competition commission re-authorizes Virgin-Etihad airlines alliance, (Dec 4, 2015)
Organizations Mentioned:Etihad Airways PJSC | Virgin Australia Airlines Pty. Ltd.
By Linda O’Brien, J.D., LL.M.
The Australian Competition and Consumer Commission (ACCC) has re-authorized Virgin Australia and Etihad Airways to continue their existing air transport services international alliance, which operates between Australia and the Middle East, for another five years, the ACCC announced today.
Under the Alliance, the airlines cooperate on joint pricing and scheduling of services across their networks. Virgin and Etihad will not share revenue under the Alliance. Authorization provides immunity from court action for conduct that might otherwise raise concerns under the competition provisions of the Competition and Consumer Act of 2010.
In August 2015, Virgin Australia and Etihad filed an application for re-authorization of their existing international alliance in relation to air transport services between Australia and the Middle East, for a further ten years. Specifically, the applicants sought re-authorization to: (1) continue to give effect to the Commercial Cooperation Agreement and associated codeshare, reciprocal lounge, and frequent flyer agreements (Alliance Agreements); and (2) make and give effect to related agreements contemplated in the Alliance Agreements, including to renew the Alliance Agreements upon the expiration of their current term.
“The ACCC considers that this Alliance would be likely to continue to deliver public benefits by promoting competition and enhancing the products and services offered to customers travelling between Australia and the Middle East and onward to destinations throughout Europe,” stated ACCC Chairman Rod Sims. “The ACCC accepts that Virgin would not operate services to Abu Dhabi if this partnership with Etihad did not exist. Virgin could not offer a viable service on the route without offering the connections available on Etihad’s network within the Alliance.”
Companies: Virgin Australia Airlines Pty. Ltd.; Etihad Airways PJSC
News: Antitrust