EC OPENS INVESTIGATION INTO AIR CANADA/CANADA AIRLINES MERGER

   The European Commission has opened a full investigation into the proposed acquisition by Onex Corp., of Canada, of Air Canada and Canadian Airlines Corp., Canada’s two major airlines.
    The proposed operation would bring under common control the two main Canadian airlines serving routes between London Heathrow and Toronto, Vancouver, Montreal, Ottawa, and Calgary, the EC said.
    Onex intends to have Air Canada, currently a member of the Star alliance, join the oneworld airline alliance, to which Canadian already belongs. The oneworld alliance would then become the only alliance serving U.K.-Canada direct routes.
    "Only if alliances face full competition will their benefits come at a fair price," said Mario Monti, the EC’s new competition commissioner.
    The EC said that its enquiries suggest that potential competitors may experience difficulty in obtaining appropriate take-off and landing rights at Heathrow.
    The Commission now has four months to reach a final conclusion on whether the planned merger might create or strengthen a dominant position.