Fair Trade Commission: "No Reason to Reexamine Korean Air and Asiana"
Asiana Airlines Decides to Sell Cargo Business
The Korea Fair Trade Commission (KFTC) stated that Asiana Airlines' decision to sell its cargo business for the merger with Korean Air will not affect the previously made 'conditional merger approval' decision.
A KFTC official said on the 3rd, "The KFTC has already thoroughly reviewed concerns about competition restrictions in both the passenger and cargo markets due to the merger," dismissing the possibility of a re-approval review.
Last year, the KFTC granted conditional approval for the merger between Korean Air and Asiana Airlines. At that time, the KFTC noted that the merger could cause competition restrictions in the passenger sector and set conditions such as prohibiting fare increases beyond the inflation rate compared to the 2019 average fare for 10 years from the merger completion date.
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The KFTC official said, "Each competition authority only reviews the competitive impact on its own domestic market," adding, "The KFTC has already determined that there are no concerns about competition restrictions in the cargo sector affecting our market." At that time, the KFTC viewed the cargo sector as having relatively more available slots (aircraft takeoff and landing times) compared to the passenger market, making entry barriers lower.
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On the other hand, the European Union (EU) competition authority demanded corrective measures, citing concerns about monopoly and dominance not only in passenger routes but also in cargo routes within its domestic market. Accordingly, Asiana Airlines held a board meeting yesterday and decided to sell its cargo business division. A KFTC official stated, "The company is making decisions to obtain approvals from competition authorities in each country," and added, "Our domestic competition authority does not re-evaluate based on the review results of foreign competition authorities."
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