CCCS grants conditional approval to SIA-Malaysia Airlines' partnership

The agreement aims to grow traffic between Singapore and Malaysia.

Singapore Airlines and Malaysia Airlines Berhad's proposed commercial cooperation has been granted conditional approval by the Competition and Consumer Commission of Singapore (CCCS).

The joint business arrangement (JBA) signed by the two airlines last 30 October 2019 was subject to assessment by the CCCS for possible infringement of section 34 of the Competition Act which prohibits "agreements between undertakings, decisions by associations of undertakings or concerted practices which have as their object or effect the prevention, restriction or distortion of competition within Singapore."

Under the JBA, the two airlines will cooperate on "scheduling, pricing, sales and marketing cooperation and other commercial areas, including special prorate arrangements and expanded code sharing cooperation to leverage on the strength of both airlines’ networks to grow traffic" between Singapore and Malaysia, and vice versa, as well as markets such as Europe."

The cooperation also covers SilkAir Private Limited and Scoot Tigerair Pte Ltd, wholly-owned subsidiaries of SIA, and FlyFirefly Sdn Bhd, MAB's sister company.

Following a public assessment and receiving a set of proposed commitments from both carriers, CCCS granted conditional approval on the JBA.

The commitment includes the airlines subjecting their arrangement to CCCS' further review when "a series of indicators signal a sustained recovery and subsequent sustained normalcy of aviation activity" on its overlapping direct routes like Singapore to Kuala Lumpur and vice versa, and Singapore to Kuching.

"There are also sufficient safeguards in place for the Parties to furnish the necessary information for CCCS’s assessment as to whether the trigger events are met," added the commission.