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EU executive clears BA, American, Iberia deal

British Airways, American Airlines and Iberia won EU antitrust clearance to deepen their Oneworld alliance on transatlantic routes and better compete with rival groups.

The European Commission, the EU competition watchdog, also cleared a British Airways' merger with Spain's Iberia.

The Oneworld members want to broaden their pact to take advantage of the “Open Skies” agreement between the United States and the European Union, which liberalizes transatlantic aviation.

The carriers offered in March to give up a number of lucrative transatlantic slots in a bid to ease competitive concerns by the European Commission about the Oneworld deal.

The European Commission said the concessions were sufficient to ease competition concerns and that it was dropping its investigation launched in April last year.

“Today's decision will enable the airlines to put in place the transatlantic alliance they have long aspired to while ensuring that the around 2.5 million passengers ... continue to benefit from a choice of frequencies and competitive prices,” Competition Commissioner Joaquin Almunia said in a statement.

Two sources with direct knowledge of the matter told Reuters on July 9 that the Commission would clear the deal.

The three carriers agreed to cede some landing and take-off slots for routes between London and Dallas, Boston, Miami and New York.

Other concessions include allowing access to their frequent-flyer programs on those routes and submitting data on their cooperation plan to the Commission. The commitments are for 10 years.

Virgin Atlantic has criticized the strengthened alliance, saying the proposals are woefully inadequate.

The Commission said the combined British Airways and Iberia would not significantly impede competition in the European Economic Area.

The US Department of Transportation in February tentatively allowed the three airlines antitrust immunity on transatlantic routes. A final decision will come after a period of consultation.

Star Alliance, which includes Lufthansa and United Airlines, and SkyTeam, with members Air France and Delta, have already been granted US antitrust immunity.

The EU executive is now probing some members of these proposed alliances. (Reuters)