BA-Iberia merger given green light by Europe

A merger between British Airways and Spain's Iberia national carrier was approved by the European Commission today.

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.













Today 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.



"Customers will benefit from easier, seamless and convenient travel to more global destinations with better connections, improved flight schedules, and enhanced frequent flyer benefits." said a statement.



The three airlines plan to launch the transatlantic joint business later this year.









Sir Richard Branson's airline, Virgin Atlantic, has been vehement in its opposition to the BA/Iberia tie-up with American Airlines (AA).



Sir Richard said today: "We have fought this monster monopoly for the past 13 years and are still resolute in our belief that this decision is shameful and consumers will suffer greatly as a result of this deal. The European Commission has let consumers down by agreeing to paltry remedies which are wholly inadequate.



"Luckily for the competition authorities, Virgin Atlantic will continue to compete to win passenger and corporate business despite this massively uneven playing field which we are forced to compete on."



Virgin said the final decision and remedies package remained "woefully inadequate".



The airline went on: "The many shortcomings include too few (take-off and landing) slot remedies, no requirement for competitors to take up the remedies which means BA/AA can proceed regardless of whether competition is in place and slots which are only available on a limited-duration lease-hold basis thereby disincentivising new entry.



"All of these factors combined mean that the remedies are unable to address the competitive harm caused by a combined BA/AA."











Pilots' union Balpa warned BA and Iberia managements that they should "not attempt to play one pilot community off against the other".



General secretary Jim McAuslan said: "Pilots in BA and Iberia have signed mutuality agreements which will stand them in good stead if managements try to take advantage and attack terms and conditions.



"The pilots have also had discussions with pilots in American Airlines.



"Be assured the British, Spanish and American pilots are determined that they should not only protect their futures but also share in the benefits of international consolidation."

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
News
ebooksNow available in paperback
Arts and Entertainment
Madonna is not in Twitter's good books after describing her album leak as 'artistic rape and terrorism'
music
News
i100
Arts and Entertainment
Tony Hughes (James Nesbitt) after his son Olly disappeared on a family holiday in France
tv
Arts and Entertainment
The Apprentice candidates Roisin Hogan, Solomon Akhtar, Mark Wright, Bianca Miller, Daniel Lassman
tvReview: But which contestants got the boot?
Arts and Entertainment
Jim Carrey and Jeff Daniels ride again in Dumb and Dumber To
filmReview: Dumb And Dumber To was a really stupid idea
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Marketing Services Manager - (communications, testing, DM)

£32000 - £35000 per annum + benefits: Ashdown Group: Marketing Services Manage...

Guru Careers: Finance Account Manager

£Neg. (DOE) + Excellent Benefits: Guru Careers: A Finance Account Manager with...

Ashdown Group: Java Developer - Hertfordshire - £47,000 + bonus + benefits

£40000 - £470000 per annum + bonus: Ashdown Group: Java Developer / J2EE Devel...

Ashdown Group: Direct Marketing Manager - B2C, Financial Services - Slough

£45000 - £55000 per annum + Benefits: Ashdown Group: An exciting opportunity h...

Day In a Page

Jeb Bush vs Hillary Clinton: The power dynamics of the two first families

Jeb Bush vs Hillary Clinton

Karen Tumulty explores the power dynamics of the two first families
Stockholm is rivalling Silicon Valley with a hotbed of technology start-ups

Stockholm is rivalling Silicon Valley

The Swedish capital is home to two of the most popular video games in the world, as well as thousands of technology start-ups worth hundreds of millions of pounds – and it's all happened since 2009
Did Japanese workers really get their symbols mixed up and display Santa on a crucifix?

Crucified Santa: Urban myth refuses to die

The story goes that Japanese store workers created a life-size effigy of a smiling "Father Kurisumasu" attached to a facsimile of Our Lord's final instrument of torture
Jennifer Saunders and Kate Moss join David Walliams on set for TV adaptation of The Boy in the Dress

The Boy in the Dress: On set with the stars

Walliams' story about a boy who goes to school in a dress will be shown this Christmas
La Famille Bélier is being touted as this year's Amelie - so why are many in the deaf community outraged by it?

Deaf community outraged by La Famille Bélier

The new film tells the story of a deaf-mute farming family and is being touted as this year's Amelie
10 best high-end laptops

10 best high-end laptops

From lightweight and zippy devices to gaming beasts, we test the latest in top-spec portable computers
Michael Carberry: ‘After such a tough time, I’m not sure I will stay in the game’

Michael Carberry: ‘After such a tough time, I’m not sure I will stay in the game’

The batsman has grown disillusioned after England’s Ashes debacle and allegations linking him to the Pietersen affair
Susie Wolff: A driving force in battle for equality behind the wheel

Susie Wolff: A driving force in battle for equality behind the wheel

The Williams driver has had plenty of doubters, but hopes she will be judged by her ability in the cockpit
Adam Gemili interview: 'No abs Adam' plans to muscle in on Usain Bolt's turf

'No abs Adam' plans to muscle in on Usain Bolt's turf

After a year touched by tragedy, Adam Gemili wants to become the sixth Briton to run a sub-10sec 100m
Calls for a military mental health 'quality mark'

Homeless Veterans campaign

Expert calls for military mental health 'quality mark'
Racton Man: Analysis shows famous skeleton was a 6ft Bronze Age superman

Meet Racton Man

Analysis shows famous skeleton was a 6ft Bronze Age superman
Garden Bridge: St Paul’s adds to £175m project’s troubled waters

Garden Bridge

St Paul’s adds to £175m project’s troubled waters
Stuff your own Christmas mouse ornament: An evening class in taxidermy with a festive feel

Stuff your own Christmas mouse ornament

An evening class in taxidermy with a festive feel
Joint Enterprise: The legal doctrine which critics say has caused hundreds of miscarriages of justice

Joint Enterprise

The legal doctrine which critics say has caused hundreds of miscarriages of justice
Freud and Eros: Love, Lust and Longing at the Freud Museum: Objects of Desire

Freud and Eros

Love, Lust and Longing at the Freud Museum