ACCC approves Korean Air Lines' acquisition of Asiana Airlines

Korean Air Lines and Asiana Airlines planes are stationed at Incheon International Airport. [YONHAP]

The Australian Competition and Consumer Commission (ACCC) approved Korean Air Lines' acquisition of Asiana Airlines.

Australia’s antitrust regulator concluded Thursday that the acquisition won't reduce competition in its local markets.

Korean Air Lines and Asiana Airlines are currently the only two carriers that offer direct passenger flights between Seoul and Sydney. However, the ACCC concluded that lessening competition or increasing ticket prices would be unlikely because Australian airlines will soon begin to offer flights on the Seoul-Sydney route.

Jetstar will begin flights between Seoul and Sydney starting November and Qantas will begin its flights in December.

“We consider that the Qantas Group offering flights on the Sydney to Seoul route with both its full-service and low-cost carriers means that there is likely to be effective competition,” said ACCC Chair Gina Cass-Gottlieb via a statement Thursday.

Korean Air Lines and Asiana Airlines is also responsible for a lot of air cargo transport between Seoul and Sydney. But the ACCC said the merged entity will continue to face competition because both Jetstar and Qantas will begin to deliver cargo through belly freight on its passenger flights.

In November 2020, Korean Air Lines signed a deal to acquire a 63.88 percent stake in Asiana Airlines and merge with it, creating a global top 10 carrier in terms of routes. It has submitted documents to 14 countries to get approval for the merger and has received the go-ahead from nine so far.

Korean Air Lines hopes to complete the acquisition next year and introduce the merged carrier in 2024. It is still awaiting approvals from five jurisdictions such as the European Union, the United States, China, Japan and the United Kingdom.

“In order to finalize the acquisition process, Korean Air Lines will continue to proactively communicate and cooperate with the remaining regulatory bodies,” said a spokesperson for Korean Air Lines.

BY LEE TAE-HEE [lee.taehee2@joongang.co.kr]