The European Commission has told British Airways, American Airlines and Iberia that they may have to give up take-off and landing slots to press ahead with a transatlantic tie-up but BA says it’s ready to refute antitrust concerns
Reports in this morning’s press suggest that the EC said an agreement between the three groups was “likely to result in appreciable competitive harm” on seven Europe-US transatlantic routes.
The EU’s competition regulator “envisages issuing a decision finding that the series of agreements signed have been in breach” of competition laws and would order that the “infringements” are ended, according to documents obtained by the FT.
“Remedies may include ... the transfer of airport slots” to rival airlines, the EC added.
But BA says the three-way tie up won’t dominate transatlantic markets and that the EU review is no different to ongoing probes of the rival Star grouping, which includes Deutsche Lufthansa AG, and Air France-KLM Group’s SkyTeam.
British Airways, seeking a deeper alliance with American Airlines than it has in the existing OneWorld group, fell as much as 8.5 pence, or 4.1 percent, to 201.3 pence and was down 3.8 percent at 201.9 pence as of 11:30 a.m. in London.
The three airlines revealed on August 14th last year that they had signed an agreement to cooperate on flights between North America and Europe to help them to overcome rising fuel costs and falling demand.
British Airways said in its statement that the opening up of Heathrow to new entrants on U.S. routes via a so-called Open Skies treaty introduced last year means slots shouldn’t have to be surrendered. It also cited growing capacity at Madrid airport as encouraging competition from the Spanish capital.