Lang gets report on BA alliance

Ian Lang, President of the Board of Trade, yesterday received the Office of Fair Trading's report on the proposed alliance between British Airways and American Airlines, setting out the concessions needed in return for allowing the deal to proceed.

The OFT is thought to have concluded that the alliance would operate against the public interest and should only be approved without a reference to the Monopolies and Mergers Commission if the two airlines agree to surrender take-off and landing slots and other facilities at Heathrow airport.

The report may also have recommended that Mr Lang impose restrictions on transatlantic routes where BA and American would otherwise have a monopoly.

Mr Lang is expected to reach a quick decision on the proposed alliance, although some observers believe he may wait until after the Conservative Party conference before announcing his decision.

Without approval for the alliance, Britain and the US will not be able to sign an open skies agreement across the Atlantic opening up Heathrow to more American carriers and greater competition.

However the BA-American link-up has faced unprecedented opposition from rival airlines and consumer groups. Richard Branson's Virgin Atlantic and United Airlines, the biggest carrier in the US, have both opposed the deal, as has the Consumers' Association, which argued the alliance would entrench the dominant position of the two carriers.