Revisiting Antitrust Immunity for International Airline Alliances

By Diana L. Moss (American Antitrust Institute)

The paper makes the case for why the U.S. Department of Transportation (DOT) should revisit its policy surrounding grants of antitrust immunity for the international airline alliances. It describes the implications of immunized alliances for domestic competition and consumers, particularly in light of a decade of consolidation among U.S. alliance carriers.

The debate over competition in the U.S. airline industry has focused to date on high profile developments in domestic airline markets. These issues include mergers between domestic legacy (i.e., network) and low cost carriers; concerns over market entry such as access to takeoff and landing slots at congested airports; and alleged anticompetitive coordination on airline capacity and ancillary fees. Concerns over dwindling choice and quality of air service have also come sharply into focus in recent years. In an industry that could not be more consumer-facing, these concerns should be a priority for competition enforcers, policymakers, and legislators.

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