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Airline Industry

United, Continental, ANA seek a waiver of antitrust rules

Karen Jacobs and John Crawley  Dec 24, 2009

ATLANTA - U.S. carriers United Airlines and Continental Airlines Inc and Japan's All Nippon Airways Co Ltd said on Wednesday they are seeking a waiver of antitrust rules from the United States to allow them to coordinate flights and fares across the Pacific.

In a statement, the airlines said they filed an application with the U.S. Department of Transportation seeking antitrust immunity in an effort to "compete more effectively" with other global airline alliances.

ANA, Continental and United, a unit of UAL Corp, are members of the Star Alliance.

Immunity permits carriers to share pricing, scheduling and other information on specific routes and has become a substitute for mergers in recent years.

The filing comes less than two weeks after Japan and the United States reached a so-called "open skies" agreement to further liberalize air service, particularly into and out of Tokyo. Japan has insisted the deal not take effect until the U.S. waives certain antitrust rules and lets U.S. and Japanese carriers deepen their alliances.

United and its partners said approval of their application would lead to expanded route choices and a wider range of fares and services.

"This joint venture, coupled with the recently announced open skies agreement between the U.S. and Japan, will significantly enhance our ability to serve customers in Japan and throughout Asia," United Chief Executive Glenn Tilton said in a statement.

ANA rival Japan Airlines Corp (9205.T) is expected to seek similar immunity to consolidate operations once it decides on a partner. JAL is being courted by AMR Corp's American Airlines, its existing partner in the Oneworld alliance, and rival suitor Delta Air Lines Inc, which is a member of the SkyTeam alliance.

The industry is carefully watching an existing application from American and British Airways Plc for antitrust immunity that would allow them to coordinate trans-Atlantic routes.

The Obama administration has vowed to take a closer look at these relationships and applications for issues of competitiveness.

The Transportation Department said it received the application, but had no further comment. The Department regularly approves these applications, often with conditions.

This week, the U.S. Justice Department said American and British Airways should agree to concessions to secure approval of their immunity bid.

In a filing to U.S. transportation regulators, the Justice Department said fares on certain trans-Atlantic routes involving American and British Airways could increase up to 15 percent under the immunity plan for the carriers' Oneworld alliance. Officials recommended that American and British Airways shed takeoff and landing slots or take other steps to carve out routes to increase opportunities for other airlines to serve those markets.

United, Continental, ANA seek a waiver of antitrust rules
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