Korean Air gets approval from Japan on Asiana merger
The Japan Fair Trade Commission (JFTC) approved Korean Air’s business combination with Asiana Airlines, marking a significant milestone in the two airlines’ merger process. To date, Korean Air has received approvals from 12 of 14 competition authorities.
The approval process commenced in January 2021, when Korean Air submitted its intent to the JFTC. Subsequently, a comprehensive initial report containing market and economic analysis was submitted in August 2021. Korean Air has proactively engaged in dialogues with all concerned parties to address various concerns raised by the JFTC.
The JFTC requested for Korean Air to submit remedies on select routes between Korea and Japan where the combined market share of Korean Air, Asiana Airlines and its respective subsidiaries (Jin Air, Air Busan and Air Seoul) would limit competition.
After discussion, the JFTC concluded that five of the 12 overlapping routes on the network were not subject to competition review. In addressing the remaining concerns, the airline has decided to cede a limited number of slots on seven routes, should “remedy takers” decide to operate on them. These routes include Seoul-Osaka, Sapporo, Nagoya, Fukuoka, as well as Busan-Osaka, Sapporo, and Fukuoka.
The JFTC also raised competition concerns about the Korea-Japan cargo network. However, with the decision to divest Asiana’s cargo business, the JFTC limited its request for the airline to enter into a cargo block space agreement (BSA) on select routes from Japan to Korea. The divestiture of Asiana’s cargo arm is subject to the approval of all remaining competition authorities, and will occur after Asiana Airlines is incorporated as a subsidiary of Korean Air.
Since January 2021, Korean Air has filed business combination reports with a total of 14 competition authorities. A total of 12 authorities including Japan, have either approved the combination or concluded the review on the grounds that the business combination was not subject to review or report. Korean Air is committed to constructive dialogue with the remaining authorities – the EU and U.S. – to obtain approvals at the earliest opportunity.
<Reference> Status of Korean Air-Asiana Airlines business combination review
○ Approved/Concluded (12 regulatory bodies)
Türkiye (Feb 2021), Taiwan (May 2021), Thailand (May 2021)*, The Philippines (May 2021)*, Malaysia (Sep 2021), Vietnam (Nov 2021), Korea (Feb 2022), Singapore (Feb 2022), Australia (Sep 2022), China (Dec 2022), United Kingdom (Mar 2023), Japan (Jan 2024)
*Business combination report not required
About Korean Air
Serving the world for more than 50 years, Korean Air is one of the world’s top 20 airlines, carrying more than 27 million passengers in 2019, pre-COVID. With its global hub at Incheon International Airport (ICN), the airline serves 111 cities in 40 countries on five continents with a modern fleet of 159 aircraft and over 20,000 professional employees.
Korean Air’s outstanding performance and commitment to the highest level of safety and customer service has widely been recognized. The airline has been granted numerous awards including a 5-star airline rating from Skytrax as well as Air Transport World’s Airline of the Year and Cargo Operator of the Year awards.
Korean Air is a founding member of the SkyTeam airline alliance, and has grown into one of the largest transpacific airlines through its joint venture with Delta Air Lines.
For more information about Korean Air, please visit www.koreanair.com, Korean Air Newsroom, facebook.com/KoreanAir, instagram.com/KoreanAirworld and Twitter@KoreanAir_KE.
