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Airlines to apply for US, EU immunity

American Airlines, British Airways and Iberia are set to announce they are applying for antitrust immunity from competition authorities in the United States and Europe in order to form a trans-Atlantic joint venture, the Financial Times reported.

If the application is approved, the alliance would share profits and revenues for trans-Atlantic routes, and cooperatively arrange capacity, networks, pricing and sales, the report said.

Last week, Reuters reported BA is confident it can lodge a US application for antitrust immunity with American Airlines, whose parent company is AMR Corp.

An alliance by the three airlines is seen attracting sharp opposition from rivals on the grounds that it would harm competition. American Airlines and BA have tried and failed to gain antitrust immunity twice in the past.

But the airlines are likely to tell US regulators the competitive landscape has been changed by the “open skies” agreement between the United States and the European Union.

The agreement, which came into force in March, allows carriers access to any US city from any point in the EU, and vice versa.

Spain's Iberia is in merger talks with BA, which first said in April it was talking to American Airlines about the alliance. (Reuters)