Buying Air Europa: no surprises from the European Union

The European Commission has issued a document objecting to Iberia’s purchase of Air Europa, revealing no surprises.

From the very first moment it was announced Iberia’s intention to buy Air Europa (November 2019) it became clear that This operation could lead to a quasi-monopoly on many routes.mostly to Latin America and some to Spain.

The solution to this problem is usually to give up slots at the airport. so that other airlines can enter these routes. Thus, In 2020, Iberia signed agreements with World2fly and Volotea to provide them with slots. How “FacilitiesAn expression used to propose to antitrust authorities solutions to facilitate acquisitions or mergers that must be approved.

Just before the end of 2023, Iberia and IAGits matrix presented a number of new proposals to the European Commission (which were kept secret) to facilitate the operation, I’m waiting for a commissionunder the leadership of Competition Commissioner Margrethe Vestager, issue a document with objections.

This is a normal procedurethat is, nothing exceptionalin an operation of this type, and This is a step by which the European Commission essentially expresses doubts that may have arisen after examining the documentation received.. The European Commission explains: “This is the formal stage of the investigation.in which the Commission informs the affected companies in writing of the objections raised against them. He The filing of objections does not predetermine the outcome of the investigation.“

In this case, IAG, as the acquiring company, received objections.

. Are, These are essentially the same documents that were issued almost simultaneously in relation to the proposed purchase of ITA Airways by Lufthansa.: What many routes will remain practically monopolistic So what is this may lead to an increase in price bills and worst service clients. In fact, both documents changing the names of airlines, countries and some cities are essentially the same.

The commission has given until June 10 to submit new remedies..

Two weeks before the issuance of the Document of Objections, Marco SansaviniPresident of Iberia, already explained that they were expecting the samethe that only then will they be able to formally respond to any objection or doubtindicating that: “We are confident that we have reliable solutions that guarantee competition.. For our part, we are doing everything so that when the investigation is completed, the Commission gives the go-ahead for the operation.

We are ready to transfer up to 40 percent of Air Europa routes to other competitors., and I repeat this because I think the figure is very relevant – 40 percent. In other words,“After the merger with Air Europa, there will be no route that will not have competition.”.