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Following ACCC's interim authorisation today: Qantas/Emirates deal - ACC needs to look at the books



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17/1/2013

FOLLOWING ACCC’s INTERIM AUTHORISATION TODAY:

QANTAS/EMIRATES DEAL - ACCC NEEDS TO LOOK AT THE BOOKS

Independent Senator for South Australia, Nick Xenophon, said there was still a legal onus on the Australian Competition and Consumer Commission (ACCC) to look at Qantas’ claims of “terminal decline” of Qantas International before any final decision on the proposed tie-up with Emirates.

“The Interim Authorisation granted today by the ACCC is by no means the end of the matter,” Nick said.

“A number of interested parties have questioned what inquiries the ACCC made before its Draft Determination on the 20th of December, 2012.

“It raises the questions - what information was given by Qantas, and what did the ACCC rely on?”

Paragraph 202 of the Draft Determination states:

The ACCC notes Qantas has provided substantial information to the ACCC indicating that its current international business is unsustainable.

Paragraph 203 states, in part:

The ACCC accepts that in the future without the alliance, Qantas will be under greater pressure to rationalise its international services and this may entail reduced frequencies and reduced activity in Australia.

“It is clear the ACCC has accepted the key ‘terminal decline’ claims of Qantas, which forms the nub of Qantas’ rationale for the Emirates tie-up,” Nick said.

“There still appear to be a number of unanswered questions over concerns raised of cost-shifting within the Qantas Group, particularly between Jetstar and Qantas International.

“If Qantas International is not in fact in ‘terminal decline’ then the whole basis for the deal must be questionable.”

For more information contact Alex Taylor on 0433 620 850 or Nick Xenophon on 0411 626 677