The alliance will be permitted for five years and allow the carriers to coordinate passenger and cargo operations and other services, the Australian Competition and Consumer Commission said in a regulatory statement today. The regulator will impose a condition limiting the carriers’ ability to adjust capacity on flights between Australia and New Zealand.
Qantas will sell tickets to 60 new one-stop destinations in Europe, the Middle East and Africa via Emirates’ Dubai hub under the alliance. The Australian carrier sought the tie-up after losing market share on international routes to Middle East and Asian rivals offering a wider range of connections and more convenient flight times.
“The alliance is likely to result in material, but not substantial, public benefits,” the Commission’s chairman Rod Sims said in a statement. “The alliance is likely to provide Qantas and Emirates customers with increased access to a large number of existing frequencies and destinations.”
Qantas shares rose 1.2 percent to A$1.74 at 10:18 a.m. in Sydney, compared to a 0.5 percent gain in the S&P/ASX 200 index. The stock has risen 55 percent since the deal was announced Sept. 6 last year.
“Customers are already responding very strongly to the joint network,” Alan Joyce, Qantas chief executive officer, said in a regulatory statement today welcoming the decision.
The regulator granted provisional approval to the tie-up Dec. 20 and today’s announcement follows the terms of the earlier decision.
Full decision from ACCC embedded below:
Editor: Edward Johnson. To contact the reporter on this story: David Fickling in Sydney at [email protected] To contact the editor responsible for this story: Anand Krishnamoorthy at [email protected]