Published on Friday, May 24, 2019

Chilean Court rejects American Airlines-LATAM joint business

Chile's Supreme Court blocked a joint business agreement between carriers LATAM Airlines and American Airlines.

The agreement also involved IAG-owed European carriers British Airways and Iberia which aimed to coordinate fares and routes more closely to increase efficiency.

All four carriers are part of the One World alliance.

However a panel of judges knocked it back citing anti-trust concerns.

"We are in the presence of an agreement between competitors ... who individually each have relevant market shares and who would acquire a joint market power that would be hard to challenge," they wrote in their decision.

LATAM called it a 'backward step' for Chile, as Uruguay, Colombia and Brazil regulators had all approved the deal.

The airlines may now press ahead with the joint business agreement in those counties only.

The Chilean judgement could impact United Airlines which has also applied for a Latin America-wide joint business agreement with Avianca Holdings and Copa Airlines.

That is still awaiting regulatory approval.

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