WASHINGTON - The U.S. Department of Transportation will begin a formal enforcement action to challenge a code-sharing arrangement proposed by Delta Air Lines, Northwest Airlines and Continental Airlines, department officials said today.
The DOT decision comes in response to an announcement by the airlines that the three carriers intend to proceed with their code-sharing plan without satisfying the department’s concerns. The airlines incorrectly argue that DOT has no right to object to the anti-competitive effects of their proposed marketing arrangement.
“DOT will not abandon our statutory responsibility to consumers nor ignore the clear intent of Congress, which has specifically directed the DOT to review such matters for anti-competitive effects,” said DOT spokesman Chet Lunner. “The DOT intends aggressively to enforce its statutory authority to challenge the transaction and require such conditions as it deems necessary to preserve competition.”
A DOT enforcement proceeding includes several phases and is similar to the adjudicatory process in many courts of law.
In this case, the Secretary of Transportation will first order the institution of a proceeding. The DOT Deputy General Counsel then oversees the development of the case by the Office of Aviation Enforcement and Proceedings, which prepares and files a complaint of unfair methods of competition in air transportation with an administrative law judge.
The judge conducts a hearing, then makes a recommended decision which is subject to final review by the DOT. Appeals of the final DOT decision could be taken to the U.S. Court of Appeals.