CCCS seeks feedback on ANA Holdings' proposed acquisition of Nippon Cargo Airlines

The public can submit feedback until 2 January 2024.

The Competition and Consumer Commission of Singapore (CCCS) has invited the public to send feedback on ANA Holdings Inc's (ANAHD) proposed acquisition of Nippon Cargo Airlines Co (NCA).

The consultation will determine whether the proposed transaction would infringe section 54 of the Competition Act 2004, which prohibits mergers that have resulted or may result in a substantial lessening of competition within any market in Singapore. 

ANAHD provides international air passenger transport and air cargo transport to and from Singapore.

NCA is a cargo-only airline company that provides international air cargo transport. 

According to the parties, the proposed transaction will not result in a substantial lessening of competition in the relevant markets given the following: 

• Within international air cargo transport, substitutes are available, as the combination of different routes between different cities (including direct and indirect flight routes) can satisfy the same or similar demands for air cargo transportation between Singapore and Japan.
• There is strong competition between all airlines in the international air cargo transport market, including other “combination airlines” that utilise freighters and passenger aircraft for the transport of cargo, and integrator airlines that also offer air cargo transportation services to other forwarders.
• The international air cargo business is largely commoditised, and therefore competition occurs amongst all of the airlines in three primary areas, namely pricing, network flexibility (destination times), and services.
• There are no significant or insurmountable barriers to entry for the supply of international air cargo transport for the Relevant Markets.
• Customers like forwarders can easily switch between airlines with little cost and time required. Additionally, air cargo transport contracts are normally of a short duration and do not contain exclusivity clauses, allowing customers to easily switch.
• Coordination between market players in the supply of international air cargo transport for the Relevant Markets is also unlikely to arise given the large number of potential global competitors who can and currently do supply cargo services to and from Singapore and would be able to disrupt any coordinated behaviour amongst existing competitors.
• Although ANAHD has some freight forwarding capabilities and, collectively, the parties offer some related services such as warehousing (which is outsourced to a third party), this limited vertical integration would not enable the merged entity to foreclose existing or potential competitors from competing in the air cargo transport market, or restrict the freight forwarding or warehousing options available to buyers in the market.

Feedback submissions will close on 2 January 2024 at 5:00 p.m.