United Airlines/British Midland Alliance Expansion Agreement

The Alliance Expansion Agreement between British Midland and United Airlines provides for enhanced cooperation between the two airlines in a number of areas, including route, schedule and price coordination, codesharing, joint marketing, and revenue sharing. The Agreement will not be implemented until after the restrictions under the bilateral air services agreement between the US and the UK, known as Bermuda II, preventing British Midland from operating transatlantic services from London Heathrow are lifted.

The Director has concluded, pursuant to his powers under the EC Competition Law (Articles 84 and 85) Enforcement Regulations 2001, that the Agreement, if implemented, would infringe Article 81(1) of the EC Treaty as it would have the effect of appreciably preventing, restricting or distorting competition in relation to the scheduled air transport of passengers, but that the requirements for individual exemption under Article 81(3) are also met.

The Director has therefore decided to grant the Agreement an exemption from the prohibition in Article 81 of the EC Treaty. The public was consulted on the Director's provisional conclusions and the proposal to grant an individual exemption in a notice issued on 9 August 2002. The Director has taken account of the comments received in reaching this decision.

The exemption will take effect from the date that the current restrictions upon British Midland preventing it from flying to the United States from London Heathrow are lifted, and is granted for a period of seven years from that date, or until 31 December 2010, whichever is earlier.

The Agreement also benefits from an exemption from the Chapter I prohibition of the Competition Act 1998 under the Competition Act 1998 (Section 11 Exemption) Regulations 2001. This exemption will take effect from the same date that the Article 81(3) exemption takes effect.

Download full version of the decision (pdf file 235 kb)

Download annexes showing routes in pdf format:

• Oneworld transatlantic routes (322 kb)
• Star transatlantic routes (314 kb)
• Sky Team transatlantic routes (319 kb)
• Wings transatlantic routes (289 kb)

See press release

 

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