Competition watchdog keeps eye on Qantas’ stake in Alliance

The Australian Competition and Consumer Commission (ACCC) has provided an update on its investigation into Qantas’ acquisition of a 19.9% stake in Alliance Aviation, the parent company of Alliance Airlines, on 1 February 2019. “The Australian aviation industry is in a state of major upheaval and now, more than ever, we are concerned that competition by smaller airlines is not hindered,” the commission says. “We will continue to seek information from market participants to gauge any impacts on competition arising from Qantas’ stake in Alliance.” The ACCC says its investigation is focused on the competitive dynamics between both companies. This concerns whether Qantas’ stake affects Alliance’s ability to raise funds, consider takeovers or participate in commercial ventures, and if Qantas is attempting to exert influence on Alliance’s decision-making or operations. The commission notes that Qantas has stated publicly that it intends to seek regulatory approval to build on its current shareholding, with a longer-term view of taking a majority position in Alliance. “Our current view is that any further increase in Qantas’ stake in Alliance is very likely to raise significant competition concerns under the Competition and Consumer Act,” says ACCC chair Rod Sims.<br/>