The U.S. Department of Transportation has given final approval for Continental Airlines’ application to join an antitrust-immunized alliance that includes United Airlines and eight other Star Alliance member carriers.
At the same time, the DOT gives its final approval of antitrust immunity to the 10-member alliance-within-an-alliance. In addition to United, the eight Star Alliance members who have been granted DOT approval for antitrust immunity are Air Canada, Austrian, bmi, Lufthansa, LOT Polish Airlines, Scandinavian Airlines (SAS), SWISS and TAP Air Portugal.
Also at the same time, the DOT has given final antitrust-immunity approval for a transatlantic joint venture called Atlantic-Plus-Plus among four of the Star carriers ― Air Canada, Continental, Lufthansa and United.
The DOT has awarded the three final antitrust approvals to the Star carriers despite strong resistance from the U.S. Department of Justice, which last week publicly expressed concern about approving the Continental Airlines application, about antitrust immunity for the Star group and about the antitrust immunity already granted to a transatlantic joint venture involving carriers from the SkyTeam Alliance.
However, following comments from the Department of Justice and other parties on DOT’s April 7 tentative decision to approve the Star Alliance airlines’ applications for antitrust immunity, the DOT placed new limitations on the immunity in various markets to preserve competition.
These limitations, called “carve outs”, affect four transatlantic markets, four markets between the United States and Canada, and all markets between the United States and Beijing. The Star carriers can continue to serve these routes, but they will not be given antitrust immunity until other, non-Star airlines start serving them and continue to do so for at least nine months.
As a condition of obtaining antitrust immunity, the DOT required the four prospective members of the Atlantic-Plus-Plus JV to implement the new joint venture within 18 months. The carriers also must provide annual reports to the DOT about the implementation of their alliance agreements.
American Airlines, British Airways and Iberia ― all members of the oneworld alliance ― also have applied for antitrust immunity for a proposed transatlantic joint venture, in the face of opposition from the UK’s Virgin Atlantic Airways, but the DOT has not yet indicated whether or not it plans to approve the oneworld carriers’ application.