Competition Policy and International Airport Service

Although airlines have long sought to enter alliances, an important new development in the last decade has been the crystallization of international airline alliances around major airline groupings. The scope and nature of these alliances differ, but there is a tendency towards deeper alliances involving co-operation on all aspects of the airline business. These super-alliances are coming as close to actual mergers as aviation’s Byzantine regulations allow, raising fundamental questions for competition policy-makers and enforcers. Alliances have the potential both to enhance the level and quality of services offered to consumers and to significantly restrict competition. Why do airlines seek to enter such alliances? What are the benefits to the airlines or consumers? How do alliances restrict competition? What is the role played by frequent-flyer programmes and other loyalty schemes? What remedies should competition authorities consider to alleviate the harmful effects of alliances? What is the appropriate role for international co-operation between authorities? This document comprises proceedings in the original languages of a Roundtable on Competition Issues in the Allocation of Airport Take-Off, Landing Slots and Ground Handling Services which was held by the Working Party n°2 of the Committee on Competition Law and Policy in June 1997. This compilation which is one of several published in a series named “Competition Policy Roundtables” is issued to bring information on this topic to the attention of a wider audience.