American Airlines Group Inc. and Australia’s Qantas Airways Ltd. received tentative approval from the U.S. Transportation Department for a joint venture on flights between the U.S. and New Zealand and Australia.
The tie-up was granted tentative antitrust immunity by the department, paving the way for American and Qantas to coordinate fares and schedules if granted final approval, the department announced Monday.
Final approval of the pact is subject to public comment and review by the department. The airlines will be asked to report on the arrangement annually and provide a “detailed assessment” after seven years, the department said in a press release.
The move comes after the Obama administration in 2016 rejected an earlier bid for antitrust immunity by the airlines over concerns the pact could harm competition over those long-haul routes. American and Qantas applied a second time in February 2018 with a revamped request to address concerns raised by U.S. officials.
In a joint statement, Qantas and American said they planned to start several new routes in the first two years of the partnership. Qantas expects to announce details of new Brisbane-Chicago and Brisbane-San Francisco services after the partnership receives final approval.
A final decision from the U.S. government is expected in the next few weeks, the carriers said.
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