But Green Light Comes With Some Strings Attached
The U.S. DOT has granted antitrust immunity to American
Airlines and four international partners in "oneworld" to form an
integrated global alliance, but also imposed several conditions
that DOT says will protect consumers and preserve competition.
Tuesday's action makes final the Department's tentative decision of
Feb. 13.
As a result of the Department's action, American and its oneworld
alliance partners British Airways, Iberia Airlines, Finnair and
Royal Jordanian Airlines will be able to more closely coordinate
international services.
The Department found that granting antitrust immunity to the
oneworld alliance will provide travelers and shippers with a
variety of benefits, including lower fares in some markets, new
nonstop routes, improved services and better schedules. The
Department also said that the alliance will enhance competition
around the world by enabling the oneworld alliance to compete more
vigorously with Star Alliance and SkyTeam, which operate similar
immunized alliances.
While the Department found that the alliance, on balance, was
pro-competitive, it noted that the alliance could harm competition
on select routes between the United States and London's Heathrow
Airport, a major hub for oneworld, where the availability of
landing and takeoff slots is limited. To remedy this potential
problem, the Department required the applicants to make four pairs
of slots at Heathrow available to competitors for new U.S.-London
service, with two pairs to be used for Boston-London service and
the other two for service from any other U.S. cities.
The Department also required changes to the alliance to ensure
capacity growth, and required the carriers to submit traffic data
and to implement the proposed alliance within 18 months. The
carriers also must resubmit the alliance agreements for review
within five years.
In response to the DOT announcement, the unions representing
the pilots that fly for American Airlines, British Airways, Iberia
and Finnair issued the following joint statement:
"We anticipate that trans-Atlantic regulatory approval of
antitrust immunity will now lead to the implementation of the joint
business agreement (JBA) between American Airlines, British
Airways, Iberia, Finnair and Royal Jordanian.
"In response, the Allied Pilots Association (APA), British
Airline Pilots Association (BALPA-BA Company Council), Sindicato
Español de Pilotos de Lineas Aereas (SEPLA) and Suomen
Liikennelentäjäliitto/Finnish Airline Pilots’
Association (SLL) have been working closely to develop a mutual
approach to promoting the job security and career prospects of all
our members in the United States and Europe.
"We acknowledge that our employers have a legitimate interest
in seeking significant economic benefits from a JBA, which has also
been described as a ‘virtual merger’ - including
sharing revenue on specific routes, cooperating on pricing and
jointly marketing their services. In turn, it is essential that our
employers acknowledge our respective members' legitimate interests
in job security and in ensuring the fair distribution of any
economic benefits.
"To achieve our aims, we are committed to maintaining and
furthering the close cooperation between APA, BALPA-BACC,
SEPLA-Iberia and SLL - all founding members of the Oneworld Cockpit
Crew Coalition - while simultaneously respecting the autonomy and
rights of each association.
"We have also agreed to meet regularly and establish an ongoing
exchange of information relevant to the proposed JBA, including
details of our collective bargaining agreements, national laws and
regulations and current and proposed flying in the area covered by
the JBA. Finally, and most importantly, we have agreed to develop
and implement a mutual approach to protect the interests of all
APA, BALPA-BACC, SEPLA-Iberia and SLL members."