Concerns emerge that Korean Air-Asiana conditional approval could benefit foreign airlines

Industry officials said Thursday that the country's top anti-trust regulator's decision to grant a conditional approval for Korean Air's acquisition of Asiana Airlines could have some adverse effects and weaken the competitiveness of Korea's hub airport, Incheon International Airport. Daishin Securities Analyst Yang Ji-whan told clients that the Korea Fair Trade Commission's (KFTC) position to grant a conditional OK for Korean Air's acquisition of Asiana Airlines raised concerns that the two airlines will forfeit some popular destination flight slots and transportation rights that currently overlap between the two airlines in order to ease monopoly concerns. A final decision regarding the merger will follow sometime next month. But the analyst also anticipated that because of the following reasons ― the absence of a larger domestic carrier having a mid- or large-sized fleet, the outstanding risk of greater benefits for foreign carriers and increased efficacy from the consumer standpoint ― there will be no visible changes in terms of the redistribution of flight slots. Under the law, flight rights are obtained through government-to-government negotiation and can only be distributed to local carriers. However, the flight time slots at the airport can be redistributed by the Ministry of Land, Infrastructure and Transport, which industry officials believe will mostly benefit foreign airlines, as low-cost carriers do not have long-distance operable aircrafts. Story has more details.<br/>