Korean Fair Trade Commission to rule on Korean Air/Asiana Airlines merger

February 1st 2022

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At press time, the Korean Fair Trade Commission (KFTC) is expected to announce its ruling on the proposed integration of Korean Air/Asiana Airlines. Read More »

A Korean Air (KAL) spokesman said in a written response to Orient Aviation “the carrier’s position is it will continue efforts to receive approvals from remaining regulators”.

In addition to approval of the merger in its home country, KAL needs the deal’s clearance from China, the European Union, Japan and the U.S. and arbitrary go-ahead from the UK and Australia.

On February 8, Singapore announced its unconditional approval of the merger plan. The Competition and Consumer Commission of Singapore (CCCS) said KAL’s acquisition of Asiana would not infringe Singapore’s Competition Act.

The competition authority conducted a public consultation into the proposed merger in July last year. It sought the opinions of aviation regulatory bodies, competitors and customers about the impact of the proposed merger on Singapore’s aviation sector.

The CCCS found the merged entity was unlikely to increase ticket prices because of the high degree of competition from airlines such as Singapore Airlines (SIA) in the passenger business. It also concluded the merger would not reduce air cargo competition, again due to significant pressure from existing and potential competitors, in particular SIA, providers of indirect cargo flights and because of excess capacity in the sector.

Since January 2021, when KAL submitted its business combination plans to the nine nations legally required to clear the operations of the merged airlines into their countries, Turkey, Taiwan and Vietnam have approved the proposed integration.

Elsewhere, Thailand’s Competition Commission has announced submission of a business combination report was not necessary as has the Philippines. Malaysia’s regulator also has cleared the merger.