Korean Air has celebrated the approval of another competition authority for its proposed merger with Asiana Airlines, with the Japan Fair Trade Commission (JFTC) becoming the 12th to approve the deal.
Japan’s decision, conditional on the ceding of certain flight slots, means that the major merger is now only seeking the approval of the EU and US, with the former set to decide in the coming weeks.
The deal, which would combine South Korea’s two biggest airlines, was first announced in November 2020 but has faced scrutiny from many of the relevant authorities, only receiving approval from some major regulators such as China and the UK at the end of 2022 and early 2023.
As a result, Korean Air has taken a number of steps to appease regulators including committing to divesting Asiana’s cargo business and ceding flight slots, including seven in Japan and four in the EU.
The JFTC’s investigation into the merger found that the remedies proposed to its concerns about the anti-competitiveness of the initial agreement were enough to lead it to decide that the two airlines would “not be able to freely influence prices” after the deal concluded.
The approval release stated: “The JFTC concluded that it could not establish that the Transaction would substantially restrain competition in any particular fields of trade.”
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While news of Japan’s approval will be welcome to Korean Air, along with reports that the EU is highly likely to conditionally approve the deal by its 14 February deadline. The recent court decision against JetBlue’s acquisition of Spirit in the US, which is being appealed, will likely be a cause for concern for the Asian airline looking at its own approval process in the country.
The US has largely been disapproving of the growing number of aviation mergers under the Biden Administration and there had earlier been reports that the Department of Justice was considering suing to block Korean Air’s acquisition.