Brazil Regulator Appeals LATAM, IAG Deal

November 7, 2016

Brazilian regulator CADE said a joint business agreement between LATAM Airlines and IAG carriers British Airways and Iberia “has the potential to generate competition issues.”

The regulator said the “potential to cause harmful effects on competition prompted the General Superintendence to challenge the operation.”

The appeal will be heard by a tribunal which will make the final decision on the approval, rejection or adoption of any remedies to remove any “anticompetitive effects.”

CADE said that were the agreement to go ahead as proposed, the airlines would have a market share of 70 to 80 percent on São Paulo-London and 50 to 60 percent of São Paulo-Madrid flights.

The entry of new players on those routes in the short and medium term is unlikely, the regulator said.

A Commissioner will be responsible for reporting the case and will present it to the tribunal for appraisal. The final decision is due within 240 days of the joint business agreement being notified, which was June 6.

(Airwise)