Competition watchdog unveils guidance note on airline alliance

Feedback from stakeholders and the government agency were taken into consideration.

The Competition and Consumer Commission of Singapore (CCCS) issued a guidance note regarding airline alliance agreements.

“Airline alliances can enhance operational efficiencies, and provide benefits to the travelling public, for example, through seamless travel and lower airfares,” the agency said. “On the other hand, certain forms of airline alliances can potentially restrict competition, and lead to fewer options and higher airfares.”

In this regard, the Airline Guidance Note includes procedural matters and substantive matters that will address said issues.

According to CCCS, procedural matters include details on notification of alliances and the process by which the CCCS review the notification. Meanwhile, substantive matters include screening factors affecting the need for notification, the consideration of potential new entry, and the deliberation of strategic air hub benefits and consumer benefits, amongst others.

The agency said that they have considered the feedback received from public consultations from January to February that included competition law and economics practitioners, industry stakeholders, the Ministry of Transport (MOT), and the Civil Aviation Authority of Singapore (CAAS).

“It’s helpful to review regulations from time to time,” senior parliamentary secretary for trade and industry and foreign affairs Dr. Tan Wu Meng commented. “When regulation becomes more efficient, it reduces compliance costs for businesses.”