EU probes Star airline alliance pacts

Mon Apr 20, 2009 1:47pm EDT
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By Bate Felix

BRUSSELS (Reuters) - The European Commission launched two antitrust investigations on Monday against certain members of the Star and Oneworld airline alliances on concerns their agreements on transatlantic routes might breach EU rules.

The probe relates to two sets of agreements between Star Alliance members Air Canada, Continental, Lufthansa and United on the one hand, and between Oneworld members American Airlines, British Airways and Iberia on the other.

The competition watchdog of the 27-nation European Union said the agreements provided for the coordination of the airlines' commercial, marketing and operational activities principally on routes between the EU and North America.

"This is a normal part of the process of examining anti-trust immunity for the proposed alliance. We are relaxed about the commission's decision," a spokesman for Spanish carrier Iberia said in a statement.

Last year, the EU launched an investigation into a planned tie-up between Iberia, British Airways and American Airlines after the trio said they had agreed to a transatlantic tie-up, to take advantage of the U.S./EU "Open Skies" agreement.

American, BA and Iberia intend to cooperate commercially on flights between the United States, Mexico and Canada and the European Union, Norway and Switzerland.

A spokesman for Lufthansa said the German carrier had been informed of the probe ahead of time and it was delivering information to the Commission. United's UAL Corp said the probe was a standard step which it had anticipated.

Stephen Rose, partner and competition lawyer at London-based Eversheds, said the probe meant the Commission was looking very carefully at aspects of the agreements, and the airlines were likely to get very detailed questions from the Commission.   Continued...