Europe approves BA-Iberia merger
Jul 14 2010
A merger between British Airways and Spain's national carrier Iberia has been approved by the European Commission.
The decision came at the end of an inquiry into whether the link-up - creating the world's third-largest airline - would breach EU rules on fair competition.
A Commission statement said: "The Commission's investigation confirmed that the merged entity will also continue to be subject to competition from a number of competitors on the markets for air cargo transport and ground handling services."
The decision comes as the Commission investigates what it called "extensive" levels of co-operation on transatlantic routes proposed between BA, Iberia and American Airlines - members of the "oneworld alliance".
The arrangements involve joint management of schedules, pricing and revenue-sharing which, Commission officials have warned, could breach EU rules on restrictive business practices.
The three airlines received a Statement of Objections last October.
On Wednesday the Commission finally gave the green light for the three-way accord, which now needs endorsement from the US Department of Transportation (DOT).
BA chief executive Willie Walsh commented: "We await the DOT's final decision but welcome this important and vital step forward. The high number of new services on London to US routes since the Open Skies agreement demonstrates that Heathrow is open.
"Between us, we have agreed to make available Heathrow slot pairs for our competitors to use on services to the US. This is a pragmatic decision so that we can get the joint business up and running as soon as possible. The slot commitments provide a further guarantee that there will be no possible loss of competition as a result of our joint business."
BA says the joint venture will strengthen competition across the Atlantic by enabling the "oneworld alliance" to compete on a level playing field with the other global alliances that already have "anti-trust immunity" from the US Department of Transportation.