US denies anti-trust immunity to Air France-KLM

23rd December 2005, Comments 0 comments

WASHINGTON, Dec 22, 2005 (AFP) - The US government Thursday denied immunity from anti-trust law for the SkyTeam alliance of airlines led by Air France-KLM, complicating their efforts to coordinate their pricing and services.

WASHINGTON, Dec 22, 2005 (AFP) - The US government Thursday denied immunity from anti-trust law for the SkyTeam alliance of airlines led by Air France-KLM, complicating their efforts to coordinate their pricing and services.

The provisional ruling prompted an angry reaction from bankrupt US carrier Northwest Airlines, whose own alliance with Dutch carrier KLM enjoyed US anti-trust status, as did SkyTeam itself before KLM merged with Air France.

The US Department of Transportation (DoT) agreed to grant broad codesharing authority to six members of the enlarged SkyTeam group: Air France, Alitalia, CSA Czech, Delta, KLM and Northwest.

But it turned down the carriers' request filed in September 2004 for anti-trust immunity (ATI) to be extended to all six, arguing they had "failed to demonstrate sufficient public benefits" to earn the status.

DoT spokesman Bill Mosley said the ruling was still open to public comment for another 28 days before being finalised.

But in the meantime, he said, the airlines "can't extensively coordinate as they would (like) on pricing and servicing issues".

Northwest expressed bafflement, noting that the airlines' request would merely have extended the ATI enjoyed by each of them before SkyTeam was rejigged through last year's merger of KLM and Air France.

"We are truly surprised and disappointed by the DoT's actions," said Andrea Fischer Newman, senior vice president of government affairs at Northwest.

"The decision is inconsistent with all of the DoT's prior decisions wherein they have consistently granted ATI to other global alliances, especially when, as here, the proposal is pro-competitive and will greatly benefit consumers."

Newman said efforts by the airline alliance to improve flight schedules, reduce travel times and lower fares enjoyed broad support from corporate clients and passengers.

"Today's DoT decision places these benefits in jeopardy, and does not help Northwest's efforts to emerge from bankruptcy," she said.

Northwest and its SkyTeam partner Delta filed for bankruptcy protection three months ago, highlighting the deepening woes of an industry in turmoil since the September 11, 2001 terror attacks.

SkyTeam, which also includes Aeromexico, Continental Airlines and Korean Air, is one of three major airline alliances.

The other two are Star Alliance, which includes Lufthansa, United and Singapore Airlines, and One World, dominated by American Airlines, British Airways and Qantas.

"The AF-KLM group regrets the fact that the US authorities have chosen to effectively defer a decision to grant the application of six airlines for anti-trust immunity on trans-Atlantic routes until there is more clarity on the move towards further liberalization of the trans-Atlantic markets," the company said in a statement.

"AF-KLM will now carefully review the text and file appropriate comments with DoT within the next days."

Copyright AFP

Subject: French news

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