European Commission’s Concerns Over Lufthansa-Ita Airways Merger: A Closer Look at Competition Issues

The EU’s interests in the merger between ITA and Lufthansa

The European Commission has issued a preliminary opinion regarding the acquisition of joint control of Ita Airways by Lufthansa and the Ministry of Economy and Finance (Mef). The Commission is concerned that this project could lead to a restriction in competition on certain routes in the market for passenger air transport services to and from Italy, potentially resulting in increased prices or decreased service quality for customers.

Specifically, the Commission is concerned about competition on short-haul routes connecting Italy with Central Europe, where Lufthansa and Ita compete with direct and indirect flights, primarily against low-cost carriers like Ryanair. On long-haul routes between Italy and the United States, Canada, and Japan, the Commission sees competition between Ita and Lufthansa and its joint venture partners. They operate as a single entity in the Commission’s assessment.

Ita’s dominant position at Milan-Linate airport could create obstacles for competitors to offer air passenger transport services to and from the airport. The Commission aims to ensure that this transaction does not have negative effects on customers in terms of increased costs or decreased service quality. While concerns related to competition represent a small percentage of the total routes and passengers served by both parties, it is crucial to address them.

The next step in the investigation is the issuance of a Statement of Objections, where the Commission raises specific objections against the companies involved. Lufthansa and Mef have until April 26, 2024 to respond to these objections, review the Commission’s findings, propose solutions to address competition concerns, submit remedies at any point during this period.

The European Commission has issued a preliminary opinion regarding the acquisition of joint control of Ita Airways by Lufthansa and the Ministry of Economy and Finance (Mef). The Commission is concerned that this project could lead to a restriction in competition on certain routes in the market for passenger air transport services to and from…

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