Feedback sought on proposed SIA-ANA tie-up

The Competition and Consumer Commission of Singapore (CCCS) is seeking public feedback on a proposed business tie-up between Singapore Airlines (SIA) and Japan-based All Nippon Airways (ANA).

The airlines entered into a proposed commercial cooperation on Jan 31 last year, in which they agreed to cooperate on scheduling, pricing, sales and marketing, and other commercial areas.

The proposed cooperation will extend to their subsidiaries, SilkAir (Singapore), as well as Air Japan and ANA Wings.

CCCS said it accepted a joint application as at June 2, and is now assessing if it would infringe Section 34 of the Competition Act, which prohibits agreements or concerted practices by undertakings which prevent, restrict or distort competition within any market in Singapore.

SIA and ANA submitted that they overlap on eight air passenger transport routes between Japan and Singapore on a direct or one-stop basis, said CCCS.

They said the proposed cooperation is "unlikely to result in any adverse effects on competition", according to the media release. The increment in the combined passenger share of the airlines on five out of eight of the overlapping routes is minimal, both parties said.

They added that there is still "intense competition from competitors on the overlapping routes that are direct routes", and noted that the low barriers to entry on the overlapping routes would facilitate entry by potential competitors.

According to SIA and ANA, the proposed cooperation "is expected to result in significant consumer and economic benefits and efficiencies". These include more itinerary options for travellers, potentially increased route frequencies or capacity, or the introduction of new services between the two countries. There could also be more competitive fares through the reduction of double marginalisation or price mark-ups.

It could also lead to improved connectivity for both nations, better utilisation of both parties' assets and combined efforts to recover from the effects of Covid-19.

Members of the public who wish to provide feedback can do so till July 12. More information can be found on the CCCS website.

Correction note: An earlier version of the article said that the airlines entered into a proposed commercial cooperation on Jan 31 this year. It should be last year. We are sorry for the error.

A version of this article appeared in the print edition of The Straits Times on June 22, 2021, with the headline 'Feedback sought on proposed SIA-ANA tie-up'. Subscribe