European Union regulators are reportedly leaning towards a full-scale investigation into Lufthansa’s bid for a minority stake in ITA Airways, as they have not sought feedback from rivals and customers on the proposed remedies. According to three individuals with direct knowledge of the matter, this development indicates that the European Commission may have reservations about the adequacy of Lufthansa’s proposed solutions to address antitrust concerns.
Lufthansa officially submitted its offer to the European Commission on January 8, outlining remedies that included relinquishing slots at Milan-Linate Airport. These slots, currently overlapping with ITA Airways on several European routes to Lufthansa hubs in Frankfurt, Munich, Vienna, and Zurich, were expected to address competition concerns, as reported by sources familiar with the matter.
In a departure from standard procedures, the European Commission has refrained from initiating a market test, which typically involves seeking feedback from industry rivals and customers on the effectiveness of proposed remedies. The absence of a market test in this case suggests that the EU executive may not view Lufthansa’s proposed remedies as sufficient to alleviate antitrust concerns.
The EU competition enforcer’s preliminary review of the deal is set to conclude on January 29, after which a decision on whether to proceed with a full-scale investigation is anticipated. The Commission, however, has declined to comment on the ongoing developments.
An Italian government source echoed the likelihood of a full-scale EU inquiry, affirming Economy Minister Giancarlo Giorgetti’s comments from the previous month. This aligns with the concerns that the European Commission has regarding Lufthansa’s proposed remedies, hinting at the possibility of a more in-depth investigation into the bid for a minority stake in ITA Airways.
Source: Finance Yahoo