Antitrust Law Daily Wrap Up, ANTITRUST NEWS: EC seeks comments on Air France, Alitalia, Delta transatlantic cooperation, (Oct 22, 2014)

By Greg Hammond, J.D.

The EC has requested comments from interested third parties on proposed commitments made by Skyteam alliance members Air France/KLM, Alitalia, and Delta, addressing concerns that their transatlantic cooperation could harm competition.

Skyteam is an airline alliance, comprised of 20 airline members, that provides consumers comprehensive access to 1,052 destinations, increased flight frequency, and more connectivity. The alliance involves profit-sharing and the joint management of capacity, pricing, and schedules, among member airlines. Citing the possibility of higher prices, the EC is concerned that the transatlantic cooperation between Air France/KLM, Alitalia, and Delta may harm competition for premium passengers on the Paris-New York route, as well as for all passengers on the Amsterdam-New York and Rome-New York routes.

To alleviate the EC’s concern, the three airlines have proposed a number of commitments, including: (1) making landing and take-off slots available in Amsterdam, Rome, and/or New York John F. Kennedy/Newark Liberty airports on the Amsterdam-New York and Rome-New York routes, in order to facilitate the market entry of competitors, and (2) entering into agreements to allow competitors to offer tickets on their flights, facilitate access to connecting traffic, and provide access to their frequent flyer programs on the three routes.

According to the EC, if the proposed commitments alleviate its competition concerns, the EC may adopt a decision to make the commitments legally binding on the three airlines. The enforcement agency has previously made binding commitments on the oneworld airline alliance and the Star alliance.

Companies: Air France-KLM; Alitalia – Compagnia Aerea Italiana S.p.A.; Delta Air Lines, Inc.

News: Antitrust