Alitalia-Linee Aeree Italiane-S.p.A., Czech Airlines, Delta Air Lines, Inc., KLM Royal Dutch Airlines, Northwest Airlines, Inc. and Societe Air France

Order 2005-12-12
OST-2004-19214 - Approval of and Antitrust Immunity for Alliance Agreements

Issued and Served December 22, 2005

Order to Show Cause - Bookmarked

In this consolidated docket, Alitalia-Linee Aeree Italiane-S.p.A., Czech Airlines, Delta Air Lines, Inc., KLM Royal Dutch Airlines, Northwest Airlines, Inc., and Société Air France propose to expand cooperation under the umbrella of the SkyTeam global marketing alliance. Specifically, they seek blanket statements of authorization to engage in reciprocal code shares and approval of, and six-way antitrust immunity for, alliance agreements covering foreign air transportation via transatlantic routings.

We have tentatively decided to grant the blanket statements of authorization, subject to standard conditions, thereby approving the application for code shares. We base this on our tentative conclusion that granting blanket statements of authorization is in the public interest because, under the SkyTeam umbrella, the Joint Applicants may use expanded code share authority to produce some public benefits, including some new online service and more frequent and convenient online service options. We have also tentatively decided that granting antitrust immunity for the alliance agreements is not required by the public interest. We have been unable to find, based on the present record and current circumstances, that the Joint Applicants have demonstrated that approval of antitrust immunity for the alliance agreements would provide sufficient public benefits. This tentative decision is consistent with the recommendation of the United States Department of Justice, which urged us to deny the request for antitrust immunity on the grounds that the Joint Applicants had failed to show that expanded antitrust immunity would provide significant public benefits. While we have tentatively decided not to approve additional immunity, the existing Northwest/KLM and Delta/Air France/Alitalia/Czech immunized alliances may continue to operate with their current rights and privileges, and subject to the same conditions and restrictions.

By: Michael Reynolds