United wants open hearing on BA's pact with USAir

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The Independent Online
IN A FRESH attempt to stall British Airways' dollars 750m (pounds 450m) investment in USAir, United Airlines has called for a public hearing into the deal, writes Michael Harrison.

A similar request by Delta Airlines was dismissed recently by the US Department of Transportation.

United, America's second biggest carrier, said an open airing of BA's proposed tie-up with the fourth biggest airline in the US was needed because of its impact on wider talks about a further liberalisation of air services between Britain and the US.

In the past 10 days, John MacGregor, the Secretary of State for Transport, and Andrew Card, his opposite number in the Bush administration, have acknowledged the importance of the BA-USAir tie-up in this respect and agreed to speed up their discussions.

United said the issues went beyond the question of USAir's fitness and touched on the ability of US carriers to expand and compete internationally. Under the US Federal Aviation Act, the Department of Transportation could not decide on the BA-USAir tie-up without a public airing of these wider matters.

Under the deal, BA would gain a 49 per cent equity stake in USAir, 21 per cent of the voting rights and access to the vast domestic US market.

In return, United and American Airlines want to be allowed to fly to more regional UK airports. The current treaty between Britain and America prevents this.

As part of the campaign to garner public support in Britain, Stephen Wolf, United's chairman, is visiting Birmingham airport next Wednesday. United wants approval to start a Birmingham-Chicago service.