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Do customers get a fair deal from airline alliances?

Do customers get a fair deal from airline alliances?
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The European Union’s competition authority is investigating the Star and Oneworld airline alliances to make sure that consumers benefit.

The European Commission is to study whether certain members of these business alliances may have broken EU competition rules. Air Canada, Lufthansa and United are being looked at in one case, British Airways, American Airlines and Iberia in another. A regulatory spokesman described the reasons behind the preliminary investigation: “On the basis of what the Commission has seen so far, we think that there may be breaches of the anti-trust rules because of the very extensive level of cooperation on transatlantic routes between these airlines.” Brussels could fine any rule-breakers as much as 10 percent of global turnover but it said wrongdoing has not been proven. Spokesman Jonathan Todd also said: “I don’t think that you should conclude that we have a problem with airline alliances as such. What we have potentially a problem with is a very specific and detailed co-operation between these airlines on such issues as schedules, capacity and pricing.” The Commission said it would assess whether these joint activities may restrict competition. The level of cooperation in question appeared far more extensive than generally extended between the alliances’ members.