EC OPENS INVESTIGATION INTO AIR CANADA/CANADA AIRLINES MERGER
The European Commission has opened a full investigation
into the proposed acquisition by Onex Corp., of Canada, of Air Canada and Canadian
Airlines Corp., Canada’s two major airlines.
The proposed operation would bring under common control the two main
Canadian airlines serving routes between London Heathrow and Toronto, Vancouver, Montreal,
Ottawa, and Calgary, the EC said.
Onex intends to have Air Canada, currently a member of the Star
alliance, join the oneworld airline alliance, to which Canadian already belongs. The
oneworld alliance would then become the only alliance serving U.K.-Canada direct routes.
"Only if alliances face full competition will their benefits come
at a fair price," said Mario Monti, the EC’s new competition commissioner.
The EC said that its enquiries suggest that potential competitors may
experience difficulty in obtaining appropriate take-off and landing rights at Heathrow.
The Commission now has four months to reach a final conclusion on
whether the planned merger might create or strengthen a dominant position.