The Australian Competition and Consumer Commission (ACCC) issued a draft determination proposing to renew the Qantas and Emirates deal to continue for another five years, subject to an oversight condition on the Sydney-Christchurch route.
The ACCC draft determination has gone to all the interested parties who have until July 12 to make submissions before the commission makes a final decision.
Without this ACCC determination, the close coordination of Qantas and Emirates on services, pricing, and capacity could face challenges, given the inherent anti-competitive nature of what they propose.
The authorization was renewed in 2018 and was due to expire in March of this year.
"The ACCC considers that the proposed conduct would be likely to result in public benefits, including increased connectivity and convenience and greater loyalty program benefits for consumers. The coordination will give customers greater choice of flight times and flexibility when travelling on routes where the operations of Qantas and Emirates overlap,” commented Anna Brakey, Commissioner, ACCC.
The ACCC argued that the greater public good that flows from the coordination outweighs the anti-competitive detriment
The ACCC only has one concern which relates to the Sydney-Christchurch route, where the only competitor is Air New Zealand. It said the conduct would be likely to result in a public detriment by enhancing the applicants' ability or incentive to unilaterally increase prices or reduce services on the route.
Brakey added: “We have included a condition in the draft approval requiring Qantas and Emirates to provide the ACCC with information so we can monitor the competitive dynamics on this route during the term of the authorisation.