AUSTRALIA’S consumer watchdog has granted Virgin Australia preliminary permission to sign a codeshare pricing arrangement with United Airlines (TD breaking news).
Following hot on the heels of a strategic partnership formed with Qatar Airlines earlier this week (TD 11 May), the proposed agreement will see Virgin Australia able to put their code on passenger flight services operated by UA, with the terms of deal to allow United Airlines to set the fare prices for VA to sell, regardless of whether they are sold as a standalone itinerary or as part of an itinerary that includes flight segments operated by Virgin Australia.
Despite Qantas recently raising concerns over VA’s ACCC application to allow it to directly promote fares offered by a proposed network of international Partner Carriers, the ACCC Commissioner Stephen Ridgeway said its draft decision to approve the tie-up was based on the belief it would be in the best interests of travellers and local airline competition.
“The ACCC’s preliminary view is that this proposed codeshare arrangement with United Airlines is likely to result in a public benefit as it will help Virgin Australia re-establish its international network,” he said
“Currently, it appears that VA is unlikely to be able to operate its own long-haul international services in the short term.
“These arrangements are not likely to lessen competition as there is no operational overlap on any routes between Virgin Australia and United Airlines and there are other airlines operating on the routes,” Ridgeway added.
The ACCC is now seeking feedback on Virgin Australia’s full codeshare application.
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Source: traveldaily